I actually think, what they are doing atm is the way to go:
August 2019[1]: full price - first edition, ~5 years of updates
August 2020[2]: full price - partial hardware upgrade 3+, ~4 years of updates (+ module upgrade for existing customers)
April 2021[3]: lower price, ~3.4 years of updates
but I also agree with you:
Soon: Release FP4, phase out FP3, reduce price on FP3+
As previously stated should the market for FP4 not primarily be existing customers - their phones should be used for the time to come - but rather new customers again 
I also don’t 100% agree that passing your phone on when buying a new one automatically helps in waste reduction. What if the phone of the one you pass it on to was still working fine, but is not worth passing on or selling as second had anymore? Then that still created one phone going to the pit (ideally the recycling center’s pit), which could have been used for another year or so.
Not saying there are no people out there in dire need of a new (handed down, used) phone (much better than their current dying one) 
[1] https://www.fairphone.com/en/2019/08/27/launching-fairphone-3/
[2] A new milestone in fairer electronics: Introducing Fairphone 3+ - Fairphone
[3] Fairphone 3 review: Sustainability requires sacrifices | Android Central