Interest rate increased on rental - I have a few options

[Alexandria Garreau]

So long story short, my interest rate has increased on my rental property and my mortgage payment went from $1220 a month to $1969. Tenants pay $2350/mo and after the rate increase, this no longer covers mortgage/taxes/insurance. Technically I’m losing $120 a month - which isn’t a lot, but I was cash flowing $900 from it before the increase. Here is where I’m at for next steps:

1. Be open and honest with tenants and tell them that the rent will need to be increased to $2500. 
2. Evict tenants (I would give them a couple months to find a new place) and take the chances with airbnb. It is becoming a bigger thing where I live now. 
3. Either increase or not increase rent then sell it in the spring when the market is a bit more hot here. 
4. keep tenants but tell them I want to sever the house to make it a duplex (would cost nearly $15,000 to do likely) and then airbnb or rent basement. 
5. Any other suggestion that’s out there. 

I’m kind of at a point where I feel impartial to every option. I think #1 is most realistic but I do want to duplex it in the near future. & since I’m on a variable rate, if it goes up any more I don’t really know if I could increase their rent more. 

I appreciate any and all input, thank you!