Keep my first house and rent it out or sell it?

[Sherri Morrison]

Thanks to anyone reading this! It's my first post, and am learning more everyday about real estate.

We purchased the 1963 bungalow house (in Ontario, Canada) in 2010 for $155,000. It's probably worth around $275,000 if we sold today. And over the years we've put about $25,000 into it - although it would still need more to get it rent-ready (at least $5,000). The remaining mortgage is $80,000, and we're looking to buy a new house to live in for less than $350,000.

So - since the value has increased so much, would it make sense to sell it?

If we refinanced the house at $230,00, monthly payments + taxes would be $1379. Plus we would still need to factor in maintenance.

Houses in the area generally rent for $1500-$1800

Does refinancing at $230k to refinance make sense? Does that sound like something that's possible, or would it be more like $165,00 if they only let you refinance up to 60%? I choose $230 because it seemed like the number that would allow us to rent it out, plus give us a good downpayment on a new home. However, if the real value of $275,000 was used, I don't believe that the rent would cover the expenses - so it makes me wonder if it would make more sense to sell it.

Please share any guidance or advice, I'd greatly appreciate it!

Sherri