Ultimate beginner seeking advice on what to do

My husband and I live in a small town in eastern Ky. We own two houses completely debt free. One we are currently living in and the other is vacant. We want to upgrade from our current home and buy a new one to fit our family of five better. 
The two houses we own are next to each other and are on the same deed. 

My question is, would it be better or more beneficial for us to fix up the vacant house and rent it out OR create its own deed and sell it? We have thought about using the rent money and saving it up until we have a good enough down payment and then moving and renting the house we are currently in as well. 

We are total beginners and  new to this and looking for any information to help us. We’re thankful for any advice or recommendations you may have.