If you have patience, you can find this set occasionally on clearance for this price or slightly less. I purchased one last year from J.C.P. online for $150, but it will normally sell for $250 regularly.
Here are a few observations concerning this particular set:
* The transformer is only rated at 40 watts, which is just enough to power what is in this set and nothing more. If you want to use a larger engine or add heavier cars (such as lighted passenger cars) you will quickly reach the limit of your power supply. You should be able to add 5-6 more freight cars with no problems, however.
* The transformer has no place to plug in non-track extras such as street lights and other accessories. If they don't run off of track power then you are out of luck.
* The engine is one of the smaller units Lionel makes and has a plastic body, as does the tender. It is plenty powerful, however, and smokes nicely. However, you will more than likely only get noticeable smoke when it is running pretty fast.
* The whistle is in the tender and is electric (a simple motor turning a fan). Even though there is a bell button on the transformer this engine/tender combo has no bell. The more expensive locos have better sounds (whistles, bells, radio chatter, synchronized steam chuffing, etc.), but for the price a whistle is all you will get.
* There are several different pre-packaged expansion sets that will include cars, track or both. This set is very easy to expand.
* The oval you get with this set is very nice and will fit around the base of a Christmas tree or on top of an average-size dining room table. Fastrack is probably the best track systems out there for O-gauge trains, but there are some people out there who are more than willing to argue the point whether you want to or not.
* This set is DANGEROUS!!! It will lead you to buy more cars, more track, a bigger transformer, another locomotive, and other unsavory behaviors. Don't say I didn't warn you...