Hold or take a loss

[John Schnyderite]

Let me preface this by saying I'm not really an investor but find some very valuable info on this site.

I purchased a condo in 2009 which last lost some value in the past few years. My fiancee and I are looking to get ourselves into a larger home while the interest rates are still low.

If we were to sell and buy now, I'd be looking at 7-12K (factoring in commission fees, etc) at closing to get my existing home off the books which has me considering renting it out.

The rental scenario doesn't look much better however. I'd lose around $200/mo when factoring in mortgage payment plus association fees. When year end taxes come, I should probably be able to recoup that money in the property taxes I'm paying and depreciation.

Am I correct that if I rent my home for a year or so and sell, I'll be able to recover some of my loss as an investment loss over the course of several years?

In my 4 years there, I've put in new floors, redone the bathroom, replaced furnace/AC so besides the kitchen being a little outdated and the water heater being 2/3 through its life cycle, I don't anticipate any major issues.

From an investment perspective, do you cut the cord on a property like this or do I have better options?