If you look at the teams challenging this season Brighton are up there with freebies and loans like James Wilson, Hull kept most of their spine from last season...McGregor, Curtis Davies, Dawson, Livermore, Thuddlestone, Abel Hernandez and added a couple of signings. Derby and Boro have spent a bit but they had decent sides already.
You can challeng with freebies and loan signings, I have no idea who'll even own the club next season. To me the mentality of the signings is more important than the quality.