So here's the thing with any hobby, you need an initial investment. You need the gear to facilitate the interest. Music production is a very broad hobby/job to get into and there is a lot you can do with little investment to start with. I'm going to show you the essentials to start with as well as point out a few other routes to take. This post will assume you have a computer as that undoubtedly is the most expensive, but also most common feature. But for the rest, I will show you how to get started for around £200.
While this is ideal, not all of us can have it and so we
can get away with the bare minimum.
DAW: Reaper ($60/£42) / (FREE)
Reaper is a fantastic DAW (Digital Audio Workstation). It is the centrepiece of a budget home studio as well as some more professional ones too. It is equivalent to some of the industry standard tools and available on both Windows and Mac.
It has the standard layout of DAWs, some people swear
by it, even saying it is more intuitive than the industry
You will notice that I have included both a price and "free" for the above. This is because Reaper comes with an unlimited, all inclusive trial period where you can use it fully for free. I do recommend you buy it though if you can because it allows for better support and updates.
Reaper is currently on Version 5 (see link for more details) and is fully capable of producing any music out there. It has it's standard level operations and functions obvious from the start however, if you go deeper it has insanely advanced functions, hidden enough so that you need to know about them to use them and so a beginner won't be frightened off.
Yes it has a learning curve but this is like any hobby, you don't belt out Van Halen after a few go's on guitar.
Headphones: Samson SR950 (£38)
This will rile some people up, but you don't need studio monitors. As long as you have good headphones to accurately measure and work with the sound, monitors are not essential. Good monitors need room set-up and treatment while headphones sound the same regardless of where you are listening.
The headphones listed above are just an example. Really you need to just search about that price range and aim to spend £40-£50 on a good pair. Dre's Beats will not work well. You want headphones with a flat frequency response for studios.
I recommend you get monitors as soon as you can as it is essential to listen to your music on multiple mediums. Studio monitors also allow less direct volume into your ears, which is something I find tiring.
Keyboard: Akai LPK25 (£32)
A MIDI keyboard is a great investment if you are using plugins and virtual instruments, It saves you having to click in each MIDI note and allows you to "jam" out a melody as you produce. Just start off with a two octave one if you are beginning and want a general set-up but if you can play the piano, you may prefer a slightly larger one.
There is little else to really say about these, they have limited function however they are used almost incessantly during the composition stage and will make much better use of time.
Audio Interface: Focusrite Scarlett Solo (£69)
There is no way to cut corners with an audio interface, they all start at a fairly high price range. Get one of these if you are using live inputs such as a microphone or guitar. If you don't plan on using them then don't buy this as it will be no use.
This is one of the cheapest interfaces and it does the bare minimum. If you are happy just getting the signals in one at a time then this is no issue but you couldn't have several singers or instruments recording at once.
If you are serious about starting a small studio where you can record a small group of instruments together, hold off on buying one until you have ~£150, your choices will really open out.
Microphones: Peavey PV i2 (£41)
A small mic like this will be great for most applications, I like this one as it is cheap and good for use anywhere. I have used it live and for recording, it sounds great. Don't waste money on a very cheap mic as it will sound awful however there is a stage where doubling the cost does not double the sound quality. A good trick is to stay around the £100 mark unless it is an exceptional mic either way or you need a specialist mic.
Everything Else? FREE!
I don't mean pirate anything but there are enough free samples and VSTs out on the internet available for free. Yes it is quicker to just buy stuff but I enjoy searching for free stuff, it's so much more rewarding. Remember that the difference between a free EQ and the difference between a costly EQ is negligible, especially if you know exactly what you are doing.
Spend your money and time on learning how to do it properly instead of hoping your cash will fix your mix. Get your textbooks from the library and even the learning is free!
Total price with cheapest options: £180
Assuming you didn't immediately buy a licence for Reaper (which you will do as soon as you have extra cash ;) )