Bad Investment. Any way out?

I need some serious advise friends. Please put yourself into my shoes and then reply. Okay?
1. If you have 1 property at $100K which is booming with face value $200K now & expected to go higher. Its mortgaged & rented. You pay the rent as the mortgage.
2. Then you buy another property worth $470K & as soon as u bought it, its value drops at 270K due to some defaulters around. This is under heavy liability & occupied by myself. Selling this would land me in debt of $200K.
3. When you bought 2nd prop, your income was enough to cover up its mortgage with some extra saving.
4. You lose job & start your own bzns & now are struggling hard to pay mortgage & with an insecurity whether you can pay next month's mortgage or not.
What would you do ?
1. Sell off the 1st prop and lessen the 2nd one's liability.
2. Sell off 2nd prop & fill up loss gradually to the mort co.
3. Keep slogging hard with hope that ur finances will improve
4. Use "Law of Attraction"?

Any other advise?

Okay, friend, this sucks. You don't say if the first property is giving you additional money, which could help you pay onto the second monthly payments, as you work to make up the additional amount needed to pay the mortgage on the second. First of all, if you are able to keep slugging hard, the market, ALWAYS turns around, and resumes the upward increasing value. So hang on, if you can. In the mean time, are you able to vacate, and rent it out? Can you take in renters, one room at a time? I guess the worst is losing your equity on the 2nd home, but may give you peace of mind. But why kill the golden goose on property #1.