Depends most on the value proposition and the location.

The other is to take on a bit of risk and rent out your house and have a tenant pay down your loan while housing prices continue to rise...the downside being your house gets older and more worn down with tenants and the risk is vacancy or eviction, excess damage, etc.  

The risk is that with 6 weeks to go they are undercapitalized and if they pulled out I own a building that needs another $100,000K in renovations before leasing to another tenant.

The risk is that with 6 weeks to go they are undercapitalized and if they pulled out I own a building that needs another $100,000K in renovations before leasing to another tenant.

Just know that it sounds a little risky based on what you posted. 

Renting either home out LTR would equate to about the same EOM cash flow after Vacancy/Maintenance/Utilities/Taxes/Insurance, but the risk is less if we move into the smaller rental.

Investment loans are more risky so there wouldn't be more flexible guidelines. 

Regardless, investing out-of-state isn't any more risky than investing in your own area - the difference will lie in stretching your west coast dollars a bit further.

It should be based on how much equity you have and what your tolerance for risk is.

Timimg the market is risky, plus I just sold one Jan 4th.