Hi Ronaldo
Very interesting question, and could make a very good case study if your cousin wants to do a Money Makeover. Here are some considerations. They are not in any systematic order as it's not possible without knowing the full financial situation of your cousin. Even then, I doubt if the answer would be clear.
1) Tax planning is a very good activity, but don't let it rule your investment decisions.
2) Diversifying your investments is a good idea. So if you are over-exposed to property, then investing in shares is useful diversification.
3) While you can carry CGT losses in property forward against gains in shares, this might not always be the case. Carrying forward of losses might be limited in some way. By keeping the property, you are very unlikely to ever lose the tax value of the "losses" to date.
4) The property investment should primarily be judged on its own merits. What is the current value of the property? Does the rental return justify it?
5) Does he have borrowings against the property? If he is selling the property to repay loans, then he is unlikely to be able to get capital gains from investing in shares. If he is selling for cash, he can re-invest in shares.
6) Most investors in property do have loans on, at least, some of the properties. The safest long-term strategy is to repay those borrowings. I agree that the risk/reward favours keeping trackers on investment properties, if you can handle the risk.
7) If you have borrowings at SVR on some properties, you should not be selling a mortgage-free property to invest in shares. By doing so, you are effectively borrowing at SVR to invest in shares. This is very risky. Even if you are getting tax relief on 75% of the interest.