Where are you located??
Location does make a difference in pricing things like this.
I wont go as far as ken, but I do think $500 is a bit much.
I kinda make a hobbie of buying used 3PH implements at good prices. Some need extensive repair, others just need fresh paint. But I have always made money and it keeps me busy in the shop. So in my area, I do have a pretty good Idea of what things are worth.
And while that does seem to have some extensive repairs, they do look pretty sound. And bushhog gearboxes are tough. And it is indeed an SQ60 Bushhog brand. I think the seller is fooling himself with the JD green colors and associating that with $$$.
But that bushhog, looks to be in pretty decient shape otherwise, I would say $300-$350 as a fair price. $150 is too low. Especially when you browse C-list in my area and see what kind of bushhog you can get for that kind of money. $150 will only buy an old rusty hunk that probabally looked like that one did before the repairs and fresh paint. I buy these $100-150 bushhogs from time to time and repair them in similar fashion to that one. And I usually have no trouble getting $300-$350.
And to answer your question, If you can agree on a price, your 40HP tractor should have no trouble with it at all. But it is a light-medium duty cutter. There are FAR heavier and beefier 6' cutters out there, but there are also lighter cheaper ones as well. As long as you dont abuse it and try to mow over 2-3" trees regularly, it should serve you well.