When I first looked at banjos, I too was surprised at the prices for American made banjos. I was looking at Gibson banjos and coming from an electric guitar background, I was not expecting ES175 type prices.
But well made banjos are expensive. If you look at the hardware and the small numbers produced, it does make some sense.
I have heard good things about the chinese made Recording King brand of banjos. The work is supervised by a former Gibson production manager Greg Rich. Quality control is so so and they are usually not set up and ready to play unless the shop selling the banjo has done the set up but once set up, they sound very good.
Prices are much lower than US made banjos with the RK35 (the lowest priced Greg Rich supervised model) under $1000. You may want to check these out.
All my information is from hearsay and internet soundclips only though. I myself have an old Gibson banjo.