Should I go for a second property?

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I currently live in a small (1100 sq foot) 2 bedroom towhouse in the suburbs (Concord, CA). I purchased it a little over 2 years ago for $275,000 and it could sell right now for about $330,000 - $350,000. The market in my area (SF Bay) is down right now, it would have sold for more a year ago.

Here's my dilema. I want to move into a bigger place with a yard and a garage. Also, I feel like the $330 a month I pay in HOA fees is a bit excessive. I've thought of a few options:

1.) Keep the townhouse because selling it in this market would be sad. Rent it out for $1,500 a month (my mortgage plus HOA is $2,000), and go rent a house for $1,800 a month. I would be biting some cash each month but would get to hang on to the property

2.) Sell the townhouse. Use the money to roll into a house at approx $500,000. The payments would be tight, but I think I could swing it.

3.) Somehow, keep the townhouse - rent it out, and buy a house. I see people on my salary do it, but I honestly don't know how. I make about $90,000 a year right now and hope to be making a little over $100,000 in a year.

Any advice or suggestions? I'm 26 years old and really new to real estate and not quite sure where to go.

Thanks!

-Chris