Renovating a half-timbered house - low ceiling heights, are there possibilities?

Oh, so then there were only two floors left. Also ok, right?

The best thing would probably be to find an architect with experience in half-timbered houses, who asks the building authority what is possible, so that a concept can be created for you and the financing requirement determined. With that, you could then go to a bank.

So you would first have to put up some money. I would talk to the owner and explain it to him like this: give me a reservation period of x months for your offer and I will pay the architect and see if it works. In the worst case, you have wasted the planning costs for the architect, in the best case, everything is ready to be signed afterwards and you are protected from the worst surprises.

Reducing from 4 levels to only 2 would be a shot in the dark; whether that is possible is probably another matter...

Nice offer some time ago:
Half-timbered house in really bad condition listed for 50k, comparable "normal houses" of similar size with (partial) renovation etc. 400-500k.
Detailed renovation proposal 9xxk€, in this case however with monument protection with the full program.

The unit will cause you significant additional costs compared to a new build. So if it is only about the low price, I would stay away from it.

Assuming the property costs €200,000 purchase price and we want to fully finance this purchase price (possibly minus incidental costs),

ROFL

so that we can use the equity (again roughly the same amount available) whenever and however we want without having to provide any proof to the bank.

LOL

The bank says: Bring the equity, and specifically for the purchase. Then you get another €50-100k loan. But only with a renovation plan and against invoices. From the bank’s point of view, the property might be worth the land + a small X. After renovation (however that may be), maybe €200k.
A bank conversation will go in this direction.
The figures are just fantasy – but the direction is right

P.S. I estimate a suitable renovation of a [Fachwerkhaus] at from €1,500 per sqm of living space.

ROFL LOL

Does that have to be? I asked you a (yes, amateurish) question, no reason to make fun of it.