Capital Gains - 2 in 5 - rent or sell?

[Alex Todd]

Hoping the BP community can help - our home as appreciated 500k since 2015 - thanks Silicon Valley :)

Now, we’re moving (still relatively close by) and discussing wether or not to try and keep and rent our current home or sell. Market rents would cover mortgage+Expense by ~$100/month, which based on my analysis would be a good return, knowing market appreciation. 

My question lies in the benefits over the long run...the 2 in 5 tax exemption for capital gains allow us to pay no cap gains Up to 500k but would require us to sell. Or we rent for long term (+25yrs) and pay full amount of cap gains tax when selling anytime after the 3yr Mark, which would be a meaningful tax hit.

If we sell - plan would be to reinvest out of state in a few properties and Put our cap gains tax savings into the market.

I’m not sure which direction the math supports. Any guidance/recommendations/thoughts are welcome!

Thanks 

AT