By selling your home, you first pay off the bank along with any fees that they may charge, next, you pay off the real estate agent for selling your home, then, you pay the solicitor . . . What happens is that you pay off everyone else before you get to play the money.
However, if you leave the existing debt where it is and borrow against the value in the home, you can still use the equity to buy more homes.
My advice, for what it is worth, is to keep the house and use the equity.
I did. I was forced to sell my hovel due to a massive debt crisis, as the only tax effective one to sell was the one I lived in. I netted about $350k and used it all for minimum deposit properties. I did this about a year ago and have since made about 20% again on each of them. I now firmly believe this is a good thing to do.
Don't forget that whilst your house is an asset (even though the loan interest isn't tax deductible!) it's also a home, one for you that may be just right.
The good thing about staying in your own place is the stability of it all. There would be few things worse than finding that perfect rental, only to have the landlord sell up at the end of your 6 month lease. Knowing that no-one can shift you at any time (well maybe the bank, if times get tough!) is a feeling no amount of money can replace. It's about lifestyle too, and living in the NOW as well as planning for the future.