Is it realistic to find a semi-decent car in the range of £3000 or do we need to increase our budget?
Yes, it is, though you may have to spend a bit of time looking through the tat to find the nice one!.
Because of this, look at common cars because you will then have lots of choice. You have mentioned the Focus, which, as a 1.6, 1.8 or 2.0 petrol, is a big thumbs up.
The most obvious other choice, in terms of sheer numbers, is the Vauxhall Astra. Plenty of them, plenty of estates. Stick with the 1.6 petrol as i believe the 1.8 can be problematic.
We considered Toyota Avensis Estate but I am not sure if we can get one for £3000
Yes, you can, though it may be getting on in years and/or may have a higher mileage (not that this is anything to worry about if the car has been reasonably well cared for).
Also, Honda Accord estate.
Re space for the dogs, what kind are they, or more specifically, how big?. Two labs are not going to be comfortable in the back of a Yaris, but two Jack Russell's would probably be fine!.
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