I know, next step its the HD 7950(3 Gb) and its 40$ more(I know its worth it since I own 2 of them) but it gets the build out of the budget.

Why you think next gen will outperform this build that badly? Next gen will use very similar architecture to the build I posted, so difference wont be that bad I think. I know its not the best time to buy a PC(AMD next GPUs are coming in a few weeks or months) but the funny thing and the point of the thread its to make a build right now thats comparable to next gen. Buying a PS4 or Xbox One at launch its not that great idea either in my opinion, they are more expensive, few games to play in the first year, hardware issues(I hope not), not much of a big step on the graphics department(IMHO), sweet spot its 2-3 years on the market when the market leader will probably have been settle and devs have some experience with the hardware.

You can actually go cheaper with cheaper RAM, PSU, HDD and if you exclude a DVD (go digital!)

Only problem is you'll miss out on exclusives, best combo is a console and a gaming PC

Really good build for the price, but two years diwn the road will probably see console games outperfirming whst it can do. Also, "PC Exclusives" can't always be seen as an advantage, unless you like the games that are generally exclusive to PC (p/c adventure, rts, mmo, etc.).

Wait what?

I have a rig with 1-3 year old parts that (minus the RAM) is still a good bump ahead the PS4/X1 (2.46 TFLOPS and an i7 920 at 2.6 GHz CPU).

Mid-range currently is a nice enough notch above the 2.

Wait for a good deal on a radeon 7950 or Nvidia 660ti like these to show up again.

http://slickdeals.net/f/6272982-powercolor-ax7950-3gb-radeon-hd-7950-179-90-ar-3-free-games
http://slickdeals.net/f/6273960-asus-3gb-660-ti-for-199-ar-ac-free-shipping-newegg

Or better yet, wait 2 months for the new generation of video cards to come out and you can probably find a radeon 7970/Nvidia 760 for $200 and completely blow the next gen consoles out of the water. I would skip the 500 gig harddrive and go for a 1terabyte one. It is $20 more and he will fill up the 500 gig one and regret not getting a bigger one.

If he is a 360 user, 360 controllers are great for PC, so at most he needs to buy a $10 wireless dongle. Also I believe you are lowballing the $ savings for games. If you are willing to wait a year you can get any nearly any game other than elder scrolls, CoD, and Blizzard games for under $10. Heck even very recent retail games have crazy deals. From recently released games I've gotten Tomb Raider, Bioshock Infinite, Crysis 3, Dead Space 3, Far Cry 3: Blood Dragon, and Hitman Absolution for a total of $30.

A gaming PC would be the way to go imo. Last gen xbox 360/ps3 were able to be cutting edge because sony and microsoft were losing hundreds of dollars on each console sold. This is no longer the case, so it will be very cheap to match and exceed them even early on. And later on he can make a better decision on whether he needs a next gen console, and if he does, which one has the exclusives he prefers. 

Personally I don't see a reason for him to ever get a next gen console. If next gen is like this gen, 95% of the ps4/xbone library will also be available on the PC. And unless he goes through 30 games a year, he can survive without the console exclusives, especially considering he must not be a big sony fan if he doesn't have a ps3.

It's not above them lol.

2.46 isn't above 1.8 and 1.2 TFLOPS?

And doesn't an i7 walk all over a Jaguar based CPU?

Comparison table added, need help filling the gaps, suggestions are welcome