I agree with the camp that suggests starting higher. My thinking is that often when you start at a "bargain" price, the consumers you are reaching are a completely different segment of the population than you might appeal to in a higher range. IF that is so, then when you raise your prices, you'll be marketing to a new group "from scratch", so to speak. One (wise) person told me, "Don't start out selling a bargain product, unless you want to sell a whole lot of bargain products!". I mean this in the nicest possible way.
Here's another thought. If you are concerned about how/when to raise prices, then you could start out with the $500 portrait advertised as a temporary deal off the regular price. Publish the prices you are aiming for , and show your short-term discount. Then folks won't be stunned by a hike. Also, you may get repeat business more quickly!
Great topic, by the way.