New single-family house construction through partial mortgage swap or let it be?

By the way, I am a she ;) )

Thanks for the hint… me too :)

You still pay interest on it, right? What's the advantage then? Is it about prepayment penalties?

It's called a pledge swap: you keep the old loan at the old, currently better conditions and basically just change the property. And yes: no prepayment penalties apply either.

The question is, when does the fixed interest period of the old loan end? One thing is always very misleading in the presentation: the mentioned equity of 280k is opposed by an outstanding residual debt of 220k. In other words, only 60k equity is available, which will probably be significantly reduced by the incidental costs of the property. Another 250k capital could come from the sale of the current house. Whether that is realistic is always hard to say. Where does the current estimate of a value of 750k come from? If even one thing goes wrong, you have very quickly overextended yourselves financially.

So the order is a bit mixed up. Currently, only around €500,000 is available from the apartment sale, of which €220,000 is the old loan. Thus, actually freely available equity is about €280,000 as of today without including the terraced house. The purpose of the old loan is that it runs until 2029 and has an interest rate of just under 1.7%. The reason we bought the terraced house was that we wanted to expand our space (home office, etc.), but there were no alternatives towards a single-family house. Either they were significantly too expensive for us or required a lot of investment. Plots of land were not available or only at prices beyond belief. Therefore, the terraced house was a good compromise, where we both said for a few years, but not forever.

I also have the feeling here that the calculation is too tight. On the one hand, regarding the construction costs, on the other hand, the total volume. Calculate exactly when you have which fixed interest rates, how long you will fully repay the loans (in different interest rate scenarios), how the later wealth accumulation is supposed to look (is that even possible then? The house does not pay you a pension), etc. Really work it out in Excel up to retirement and beyond.

Life is more than just a house. How do you want your life with child(ren) to look? You never realistically imagine it beforehand, but also consider: What do you want to offer your offspring? Hobbies, travel? Is that perhaps important to you? Or would you be satisfied in doubt with a vacation in your own garden and weekly shopping at Aldi. You don’t have to be ashamed of any of that, but you should be honest with yourself. Otherwise, you will end up "house poor" and subordinate everything to paying off the home. You really have to be sure that the single-family house alone makes you so happy that it compensates for that.

5700€ is not that much either if you have to cover 3000 for the loan alone. You can leave out the wife's salary at first – there isn’t much parental allowance there, for the second child it is even less, it all goes to the kids anyway, and maybe you have to/want to take parental leave longer than the parental allowance period. For a healthy calculation, I would leave that out. (In your constellation, I just assume that you are going the classic route "woman stays at home/reduces working hours" because the salary difference is so large)

where we both said for a few years, but not forever.

Then first arrive there and start family planning. See how expensive the child will be for you. Because also…

There is nothing to be ashamed of,

… there is no shame in a terraced house. When you then have more clarity and the financing issues are settled, you can look further.

At the moment, only about €500,000 is available from the apartment sale, of which €220,000 is the old loan. Thus, the actually freely available equity is about €280,000 as of today without including the terraced house.

Sorry if I'm dwelling on this, but I still find it confusing. It even confuses me more. According to this presentation, it sounds like you have another €220,000 lying around somewhere that belongs to the loan.
Actually, it’s simple:
Assets: xxx
Outstanding debt: yyy
Installment: zzz

(This results in a net worth of: xxx - yyy)