I think there is a psychological advantage to moving a kid into their own room as a baby and letting them get used to their own personal space away from mum and dad. I feel like it sets them up to feel/be more independent as the years go by. Filling the room with familiar baby/kid stuff makes them feel more comfortable and you can only do that to an extent if you share a room with them.
My daughter is five and for the last two years she's been telling us about how she wants certain things to be in her room - how she wants the lighting to be at bed time, how her toys should be arranged on her bed, which pictures to put on the wall, etc. She likes to look through her wardrobe and drawers too to pick out her clothes for the day. I can see that she appreciates having that control and confidence in her own space, and ultimately it's a way for her to express herself just by doing something like pick her own wallpaper.
You're asking for advice so mine is: get the extra room if you can afford the bigger place. Sharing your bedroom with a child for years doesn't sound fun and I genuinely don't think your husband realises what a pain it will be. When your baby turns into a toddler they will be rolling around in bed singing, making toddler noises, trying to get your attention when you just want to sleep, etc. You'll risk waking them up when you want to pee at 3am, snore, roll over and creak the bed. Night-time potty training is recommended for around four years old so if your child is still sleeping with you you'll have to do that in your room.
It will be a nightmare, seriously. Kids need their own space just like parents do. Some people make it work when they have to, but if you can afford the room, get the room.