Selling in ATL - Great Tenant - Lease to own? Wrap? Other options

[Jon Li]

Hi, I'm a newbie investor who's just discovered the awesome world of Biggerpockets. 

I currently have amazing tenants in Atlanta (for 8+ years), though after doing actual calculations of my cash on cash return (thanks to Bigger pockets), I realize that my cash flow is far too low (only netting ~$100/month). SO, I've decided to sell while the market is still relatively hot, though I'm finding that 1) I hate to lose these great tenants 2) I'd likely need to make some repairs to the home (~$6K worth) 3) Tenants have 3 kids in school 4) Would be willing to hold longer if I can improve cash flow 5) I wonder if I've missed the "hottest" selling month for Atlanta in May 

The tenant is interested in purchasing as well, though currently does not have enough down-payment for purchase. 

I've done some initial research, and it looks like I could:

1. Offer lease to own option: Though I would need to raise monthly rent at least $300 to ensure my cash flow is improved and am not sure how to factor in purchase price (for potential appreciation/depreciation)
2. Offer wrap mortgage? I still have $120K left on the mortgage, and this sounds complex
3. Just list and sell to another buyer? Seems like the "simplest" option (though costly in terms of realtor fees/repairs, etc)
4. Any other options?

A few facts:

1. Purchase price: ~$200K
2. Current Appraisal: ~$250K
3. Hope to sell Range: $245-280K
4. Mortgage left: ~$120,000
5. Currently on month-to-month lease

BP Pros, what would you do? My main goal is to improve cash flow/get at least some money to use towards down payment on other properties, though I would love the chance to help out these young tenants as well. 

Please let me know asap as I need to act quickly :)