Should we sell Investment Property to buy house?

I have a one bed apartment in Tallaght on a tracker. Im renting it at the moment . It used to be my principle residence. The wife and I live in an Apartment in South side dublin which we owe 130k on -a two bed. Ten years or so left on Mortgage and in a very good location. I would still say it would fetch around 200k but hard to say in current climate but it is not in neg equity. She point blank refuses to sell the 2 bed as she regards it as her pension and she bought it originally.

Here is our issue-we want to buy a house next year. The Apartment in tallaght is drowning in neg equity. We owe 130k on tallaght as well but its a longer term-something like 27 yrs left. Its worth only about 80-90k in current market. I bought it for 180k in 2003 (late)

Personally I dont want to have 3 properties-well particularly two investment. Tallaght is renting and taking in 725 . I have a letting agent to pay as well. Im just wondering is that a bad idea keeping both places? Our joint income is secure next few years and totals 90K

Banks won't take rental income into account very often now, in other words to get a mortgage for a 3rd property house you would need to prove that you could repay all 3 mortgages even if they were vacant and not let out. If the 2 bed has potentially 70k equity in it then this could cover the negative equity on Tallaght apt. You could sell the 2 bed, sell the 1 bed - put both up and hope they do sell and then with any funds left over use that as deposit on a house. Personally I would rather do that, own one house and not be a landlord.