Am I thinking about this right? Sell vs Rent Starter Home

[Ben Schaefer]

I have a classic situation where we're looking to buy a bigger home and am making the rent vs sell decision on our primary residence.

Current Home

- 4/1 worth ~$210k

- Mortgage has $118k left @ 2.85%, 11 years remaining. $1,277 / month

- House could rent for $1,300 to $1,400

If cash out refi I could get $45k in hand and cut the payment in half. Running out the cash flow #s then, assuming the 50% role (which seems reasonable given an older home), I'd break-even or lose a couple hundred backs a month.

I love the thought of having paid off real estate generating cash flow down the road. However, in this situation I'm having to refi to 30 yr to get as low a mortgage as possible which I don't love. And at this point I'm banking on appreciation, which I do have high hopes for the neighborhood, but is merely speculation.

Am I missing something, should I be approaching this differently?