...We are therefore in a hurry to put together enough money to buy our own home. Given the housing market here it would take far too long to buy a house without a mortgage, but we are looking to put down at least 30% on the house and take no longer than a 15 year mortgage with the expectation that we pay it off as soon as possible! We are looking to spend about $240,000 on our first home).
I would suggest first that you read
Why your home is not a good investment, on JLCollinsNH's blog (note he is a US investor, so mortgage interest is deductible in his article - in the UK it's not). I say this as someone who is planning on being a homeowner someday:
buying a primary residence is not a good investment. It will give you shelter. It will give you pride. It will give you the warm and fuzzies when you look at it and think of it. But it is not a good investment, generally.
So here is my question, should I still be putting money aside for retirement if I do not yet own a home?
See my above, and doubly so for retirement savings. In most countries, UK included, retirement accounts offer certain tax benefits. When you compare the benefits of owning stocks in a tax-free or tax advantaged account, versus owning a piece of real estate which you pay for and maintain with only after tax money, pay taxes on when you sell it, and factor in massive transaction costs - the money you put into your workplace pension or personal pension will almost certainly grow far, far faster than the equity in your primary residence.
...but my partner is telling me I'm stupid for thinking of investing while we are saving up for a deposit and believes it is equally silly to be continuing investing for retirement prior to having paid off the mortgage.
First up - the girl of your dreams shouldn't be saying to you (through words or actions) that you're stupid. Find a way to talk about money factually and unemotionally. You both want what's best for each other and for your nest egg.
Secondly, your partner is almost certainly wrong. Housing prices generally track inflation, meaning that in the developed countries, you can expect your home to appreciate at a rate of somewhere between 1-3% per year. Yes, sometimes this figure will be higher if you purchase at a low point and sell at a high point - but generally, you'll earn the rate of inflation. Perhaps a percent or two more, but not "lots and lots more".
Conversely, your investment accounts (workplace pension scheme or personal pension) will likely earn around 7-10%, depending on the time period you're invested.
So, simplifying your choice down to a one-or-the-other:
Should we buy a house which has massive transaction costs, zero tax benefit (the UK has no mortgage interest deduction), and is likely to appreciate at 1-3% per year?
OR
Should we pay into our retirement funds which have near-zero transaction costs, high tax benefits, and are likely to appreciate at 7-10% per year?
The choice is obvious, but it's not the one most people are happy to hear, because home ownership is seen as a rite of passage. So, if you are going to purchase a home, do it with your eyes open: Your home will likely be a very mediocre investment. However, it'll probably bring you lots of non-financial happiness.
Hope that helps!