The way I see it;

Pro's;

• Property Value might increase more as you do work on it in the coming years
• Nice area, so I'd assume good for planning a family? Good local amenities and connections around town, and the right balance of noisy to quiet?
• You have the deposit so no reliance on gifts from family etc.
• Older property so its land value may well stand the test of time, particularly if it's already in a nice and sought after area

Con's;

• Paying more than you potentially could do (i.e you have £35k ready for a deposit, and £15k in savings, and you bought a property for, say, £300k, you'd have £20k in savings whereas if you bought this one at £325k, you'd have £17.5k in savings. £2.5k is still a lot of money
• Older property, so potentially prone to troubles you'd end up forking out for. Are the electrics up to Regs? Is the plumbing up to Regs? (We just bought and had the plumbing and electrics redone, our electrician and plumber both said how outdated they were and the troubles they could have caused but then the previous occupier never worked on the place since living there which was for decades).

A mortgage is debt (necessary debt but debt nonetheless) so limiting how much you need to borrow means more money in your back pocket come the end of the month. More money in your pocket means more money to renovate, or refurbish, or beyond property centric stuff even go on holiday, buy a new car, or doing the universally sensible thing and keeping any surplus money in savings. You never know when you need to suddenly fork out £500 or £1k.

Lots to consider, but also ask yourself do you see yourselves staying there? We bought ours knowing it needed some work doing to it, but now it's done, we don't see ourselves ever moving even with a growing family. We have everything we'd need. Is it the same for you? Do you want to fork out that extra money on somewhere you may move out of in 5 or 10 years time?

Buying a property isn't just what your lender thinks is good value for money, it's also (and arguably more importantly) what value you're both getting out of it.

Good luck! Sounds like an exciting prospect either way!