The 7 performs great with iOS 12. I'm impressed at just how well my 7 Plus does with iOS 12. It feels brand new.I'm sure I'm pretty unique in this...but I just upgraded my iPhone 5 to a brand new, top of the line iPhone 7 which arrived yesterday. At a third to half the cost of the new crop of iPhones, coming from such an ancient model (the 5), I am stunned by how great this new (to me) phone is. Four years from now I'll probably buy a new XR and be suitably stunned with it's speed etc. But for me and the way I use my phone, the 7 is just amazing. My checkbook has similar feelings of joy too!
I think the 32 GB model of the iPhone 7 is too small for a lot of people though. The next step up is 128 GB for $549 vs. XR at $799. Which do I think is the better value? It depends on your needs and usage, but at that price point I prefer the XR for $250 more. But I hear ya on the cost. The 128 GB XR costs 70% more than the 128 GB 7.