Remember you can always trade up later and if it is a worthy instrument you will often get back as much as you originally paid. Remember that cachet can be liability. If the charming old upright you found has a badly cracked soundboard and needs a complete rebuild - pass. The right piano for you must appeal to both your ear and your heart - but go after the sound first. Everyone has an individual response to music, so go with what you like, not what someone else tells you you should like.
Touch is almost as important as tone.
Play every key and feel for sticky or squishy action - it should feel as if there is no obstacle between you and the instrument. Listen for notes that are out of tune and for buzzes and rattles. These few things are as important as a look inside. Pluck a string in the upper register and run your fingers over several strings. If the sound doesn't ring out, move on.