Flip or Rent? Good amount of equity, wrestling with what to do!

[Nick Poe]

A year and a half ago, wife and I bought a home for $89,000 in Northern Indiana on a 5% down conventional mortgage. We currently owe 80,000 on the note. At closing the place was already worth $114,000...that's before we renovated. Now that the reno is finished (spent $6,000 and did the work myself), it's likely that it is worth $140,000 based on comps. 

The big question is this, do we sell in July (after the 2 year cap gains clearing) and walk away with our $60K in equity? 

Or do we rent it out? The downstairs of the house could be one unit probably earning $850 per month and the upstairs could be a separate unit (it has a separate kitchen, bath, 1 bath and living) for $550 per month. Almost meets the 2% rule. My mortgage, utilities (shared), maintenance reserves, and water would be $1,000 per month. 

So it's either walk away with $60 grand cash in July, or take on a couple of renters and cashflow $400 while gaining more equity. 

Bear in mind I run book consulting business and travel quite a lot for work, so managing renters is not necessarily the most appealing thought, but I'm also open to prioritizing for the right fiscal reasons. Happily married and have one daughter with another kid on the way. Taking equity and upgrading to the "dream home" is tempting, that's for sure. But not sure if it's the best long term strategy. 

Thanks all!

Nick
Northern Indiana