Selling to rent... Good idea??

Hi. I owe 227k. House worth 240k approx. On 4.65 var and thinking about fixing 5 years at 5.75%. Trs ends in 2012 after which repayments will be approx 1350/month. I can rent similiar house in this area for approx 800/month. I'm married with 3 small kids. Can't see financial sense in holding a property costing me twice as much nearly than renting all the while falling in value. Any thoughts greatly appreciated. Thank you

Are you sure you would get 240k for it?

You would want to be certain you could get the price you think you can.

Even if you put it on the market today, it may not sell till next Spring and another 50k could be gone off the price.

Also, moving with 3 children is a very, very large upheaval.
The older they are, the harder it is on them.

You would want to be certain that the rented house you get is not, and won't be, up for sale in the near future. There is nothing worse than getting the call from the landlord/agency saying 'you have to be out in 6 weeks, sorry'.

Will you have the job security/savings say in 2 or 3 years to buy another house...
We are currently renting, but we have substantial savings to buy another house when it comes along.

The whole idea of owning your own house is - that you like living there, can afford it, and it provides security.
It's a whole different ballgame not being able to paint the kids rooms, put up a picture on someone else's wall etc.
Renting another house with little or no savings for another deposit may not be a great idea. You may end up spending the 'extra' money every month anyway.