I, personally, would not borrow near the top end of what the calculators say you can afford. Live within your means and save for retirement. But between buying your current rental or buying something a bit more, consider that you're currently without a chain. This makes you an attractive buyer because you won't slow down a transaction. The next time you go to buy a house, you'll likely need to sell one first, which makes it much more difficult. So for this house purchase, get all the things you want/need. If your garden now is too small, go for one with the garden you need for your child to run and play in, etc. If you might have more children, consider an extra bedroom or two, and another bathroom.
I'm not suggesting buying the house you ultimately want to retire in, but do consider the things your family needs for the next ten years or so, at least.
On the other hand, there is something to be said for buying a house that is good for things you can’t change (like location and being in a cul de sac, and not having crazy neighbours) and bad for things you can fix, like carpets and a new front door. You can completely gut a house and build everything inside new again exactly the way you like it for £20k or so.
That’s what we did for our first house and I just visited for the first time in 5 years. I just about cried when I saw the kitchen that we designed, with exactly the appliances we wanted.
