Latest news is that we in UK are technically in recession; but you would not think so from the bouyant retail market.
ffb; one of us is wrong! I've just committed additional mortgage and spare capital to invest in a second home to rent to students. Sunday Times (or Times?) recently published an article saying that this was the way to go.
The rents will pay the mortgage interest. The house market will continue to rise and when I sell I'll be able to buy that big yacht and sail around the world. Can't be bad eh?
I wouldn't sell if you don't have to. The interest on your capital will barely pay your rent and you'll gradually find that you can't afford to get back into property at the level you would like.
Remember, buy land now. They're not making it any more!