I am not a fan of baskets. If you put a lot of weight on the front of the bike, it might be more difficult to control the bike. I would opt for a rear rack. It looks like the bike frame has mounting holes for a rear rack. I don't actually have a rack, so I'll let other people make some recommendations.

How much "stuff" do you want to carry? Take a look in the Commuter BIke Pictures thread for some ideas of kinds of rear racks that are available. You might see something you like.