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

So if you are not totally unhappy with a living situation, I would just leave it as it is and continue living in the townhouse.
If you do not improve financially significantly, your disposable income will very likely decrease in the coming years (costs due to the children + part-time work of the wife). But you are in such a comfortable situation that you don’t have to restrict yourselves at all because of it.
Only very, very few families have something like that!
So why always bigger and more expensive and therefore more financial burden?
Your salary is great, but I wouldn’t dare finance such a huge amount with it. You wouldn’t have a chance to possibly step back professionally until retirement, even if you might have to at some point.

In 2020 we bought a small townhouse because financially there wasn’t much more possible at that time and we didn’t want to take a big risk. Three years later, we now have 2.5k more net per month + a second car (company car). It can’t get any better than that. My wife could even stop working if she wanted or had to.
This luxury of not having to worry so much about money is priceless. Life can be enjoyed so much more with it.

Where do I know that from? Because I still have 3 more properties as investment assets with the bank

How is one supposed to guess anything when new information magically appears after a few days... I would say now: Just do it. Your decision has basically already been made, hasn’t it?

our decision is really not final yet, we are rather about 60% against it, despite equity and everything, we still want to live reasonably. With a burden of 3,500 including additional costs, it's not easy when the child is there. Then we would have significantly less income, as parental allowance for 2 years is around 550€ plus child benefit. Then 1,000€ are missing and a child is not cheap either.

I didn't want to mention the other investments, as these don't play a role in the construct for now. Of course, they could replace the remaining debts later at some point, so we would be done with the house well before retirement.

The situation now is okay. Of course, it wasn't our dream or our wish, but it's bearable. These are all luxury problems, of course. We would also have no stress waiting for 2-3 more years first and then going searching again.

The question is how land prices and everything else will develop. I can't imagine such high interest rates in the long term. With the demand for living space and the ever-increasing requirements for construction, something has to happen.

I do not see the insurmountable obstacles like many others do. Yes, these are all huge sums, that’s true. And in relation to income, it can backfire in the event of total market distortions (RH can only be sold well below the assumed value, construction costs rise by multiples of what was previously assumed). On the other hand, you still have a stable safety net in case of emergency thanks to the additional properties only mentioned now. And honestly, that’s the only reason I assess it this way.

In principle, you have the financings. The resulting mixed interest rate is not bad either. If I see it correctly, the total amount would be managed as follows:

280,000 net equity
250,000 expected equity increase from RH sale
220,000 old financing ETW
500,000 old financing RH?
----
1.25 million

Currently, there is at least the possibility of getting access to plots of land – negotiations are certainly possible here as well. And craftsmen, carpenters, masons, installers, and tilers are available again. Prices are no longer being called out like in the past two years for every dream project. I would not wait for a potentially better time someday. Until then, all prices will rise again; building plots will probably become significantly scarcer, and the availability of craftsmen generally will not improve. So in the overall situation, I simply ask myself: why not?

Regarding construction costs, one should honestly ask whether this matches the demands. You should at least be willing to partially let go of these demands if it does not fit into the budget.