I was able to furnish my house for under $300
I got all my items from ebay and got my dad and dh to go get them for me, most items I picked up were in top condition from people who were just upgrading or moving into a smaller home.
Also, try freecycle on yahoo, people are giving away their unwanted items for free. I have not used this service but some of my friends have and they love it. There are also a few auction houses in my area that I go to for fun.. Last week I picked up a whole bedroom setting for $5!!!! I plan to sell it in peices on ebay, so maybe look around for that kind of thing?
My dh and I are paying off a mortgage with one steady income and we are doing well. Although we dont have a bub, dh is a messy and hungry boy all the time. We do most of our work on the house by ourselves too and that saves money.
The only things we buy are grocerys and paying for our bills. We dont go to shopping centres in fear of tempting to buy things. If you have people that will baby sit for free then you should be fine One of my friends has a 2 year old and a one day a week job. I dont know HOW she does it, but she manages!

Good Luck to you!