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>eBay has kits that come from China for about 120 quid. I know these will be quite bad, but how bad?
They're pretty toy-like. They'll make light cuts in wood and plastic, maybe engrave aluminium, but that's your lot - they just don't have the power or the rigidity for more serious work.
The essential question is what sort of parts you want to make. If you need to produce complex parts in metal that are beyond the capacity of a three-axis machine, you'll either need to order them from eMachineShop or get into lost PLA casting. If you're producing very thin metal parts, photochemical etching is cheaper, easier and will produce better results. If you're producing relatively simple parts, hand tools and a bit of practice might be more than sufficient.
If I could only have one machine tool, I'd take a lathe any day of the week - it's the only way of producing parts with accurate rotational symmetry and it's easily adaptable to basic three-axis milling. Something like a Unimat SL is really a universal tool for model engineering and the like. Others might choose an SLA printer or a laser cutter based on their particular needs.
It's also worth looking up your nearest hackspace - not many have CNC routers, but most have a decently powerful laser cutter and an assortment of basic manual machine tools.