How much repayment is advisable for how much net income?

We are currently on parental leave, our household net income has therefore shrunk to ~3700 including child benefits, and we pay 1300 for the house including additional costs. We have 2400 € of free capital to get through the month.
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On the subject of daycare... as soon as a spot opens up in our preferred daycare, our child will go to daycare. Surely this is also a "baggage" from our own childhood, but I did not turn into a mass murderer with daycare, kindergarten, and full-day daycare either.

6,050 net including child benefit for 2 children (PKV adjusted 5,250 net). Loan 1,220 (currently 550 interest + 670 repayment). Refinancing next year, rate remains the same, repayment portion increases to approx. 970 vs. 350 interest). Still make special repayments. Will not do so after refinancing.

Why? Exactly these questions you asked we also asked ourselves and observed our way of life.

Parental leave with less income worked too, you restrict yourself, when income increases you automatically spend more money. Vacations become more expensive, you no longer go to Aldi but to Rewe, constantly buying clothes.

Clubs, clothes for children, etc. Either you have a house or children. Both also works. However, you have to "harmonize" it. A day trip to the water park costs about €100 admission (in the West). Even zoo visits become more expensive with 4 people.

We eat out once a month. The little ones currently only eat spaghetti, so cheap.

We have a cleaning lady twice a month because we have no time to clean.

Everything works! And it is right to think about it already now! But everything changes!

We have 4,200 net with two children. Monthly installment 1,600. In the last two years, we also managed the special repayment of 5,000, and we will surely manage that in the coming years as well. Additionally, we are also setting aside some money for contingencies or to have another lump sum off the loan after 10 years.

Put the other way around. If you have a burden of 900, you would definitely have that much in a rental apartment as well.

We have a net income of 4,200 with two children. Monthly installment 1,600. In the last two years, we also managed the special repayment of 5,000, and we will definitely manage that in the coming years as well. Additionally, we also put aside something for contingencies or to have another lump sum left after 10 years to reduce the loan further.

Look at it the other way around. If you have a 900 burden, you would definitely have at least that much in a rental apartment.

whereas with a house you still have additional costs + reserves that you should build up

We have approximately twice your net salary. We pay 1400 euros to the bank monthly, over 27 years, with a 10-year fixed interest period. In your place, I would probably extend the term. With the children, it is very individual. My wife returned to work at 50% after 2 months with both children (50% parental leave, child in the office) and was back full-time after 12 months. The loss of income is almost zero, and as a side effect the career does not get a "setback". For that, we now have to pay almost 800 euros for childcare for the little one and also have a lot of burden from services such as a cleaning lady. For 40% or 50% of the income, I would not take on a loan. If a good 2,000 remain for living, you can get along quite well with two children. In that area, you can easily adjust your expectations to the circumstances, I know that from experience. If less is available, the risk of being ruined by unexpected expenses seems too high to me.

whereas with a house you still have the additional costs + reserves that should be formed

Additional costs are under €300 per month (two-family house), so manageable and similar to rent. Of course, reserves are formed, I wrote that some savings can still be made with the burden and a part of that can then be used for repayment in 10 years. I also now have a "buffer" of €20,000 that I consciously do not put into the loan for contingencies...

But as I said, with the TE's net income, €900 should easily be possible. That's in the range of rent for an apartment. I might even go slightly higher there and then make the rest via special repayments.