Sounds like a bargain to me.....just watch out that the turbo is working ok as I THINK that they tend to start giving up the ghost around that sort of mileage....not too sure about my 80Avant TDI which has similar mileage...its in having auto gear box oil and filter changed as well as the diesel fuel injection pump. Hope after that to be able to give it a good thrash and then I'll find out if in fact there is an issue with the turbocharger.
But for £500....
Last thought, maybe worth sticking a diagnostic plug in to see if there are any stored faults?