Do you have time and desire to explain that a bit more closely? It’s something I don’t quite understand, and I’m not a professional either. I assumed that due to the enormous borrowing and money flood, real estate/houses are a good investment, especially since many international corporations, if I’m correct, buy up houses and property in Germany. Why is "money in the bank" more valuable for a bank than (initially shares in) property and houses?
As far as I have heard from people I know, they usually look very closely, even more so than before Corona. We live in a region with an overheated real estate market, meaning the bank’s valuations are often below what you have to pay on the market. So if, say, you want €500,000 but the house is worth only €350,000 to the bank and you don’t have the difference as equity, the loan gets rejected. Prices have risen again here despite, or precisely because of, Corona. Then banks generally seem to want to take less risk, depending on the sector (Corona effects, now and in the future). They fear job loss, income reduction, who knows what, and thus insolvency. Loans that are tight, and I would definitely call the one discussed here tight (issue of upcoming parental leave, ratio of equity to loan amount low, credit bureau entries, debts), are currently more often rejected than approved. As I said, I’m an amateur. But I read attentively on this topic and perk up when I hear something about it from acquaintances and friends.
And I’ll gladly repeat again: I certainly mean no harm to the OP and their family, I only view this as a neutral outsider. And as a private person, I would advise against this loan project anyway, but that’s just my personal opinion.