Need In-Law advice

So my wife and I are looking to buy a new house. We've found plenty in our price range that are in nice areas blah blah. Today she says that her parents found one for us that is larger than the ones we've been looking at, in a nicer area than we've been looking at, and a little out of the price range. Here's the kicker. There's a "Granny House" in the back. They had suggested that we buy this home and they live back there. I need some advice. How many here would do this, is this something I should really consider saying yes to, and if I stick with my initial reactionary choice of no, how do I break it to the wife. Let it be known that I actually really like my in-laws and they me, so it's not a matter of not getting along or anything.