sell or rent it out?

Hi,

my wife and I have one investment property valued at $240, 000 and on which we owe $225,000. $15,000 available in redraw. Our home in which we currently live is valued at $230,000 on which we owe $105, 000. ($50 000 available in redraw) We have two young children, another one due in September. Our current home is two small (approx 10 squares) and as with another child on it’s way we need to find something larger. My position was made redundant in December last year and since February this year I have been contracting ($6000 per month) . As a result, the banks won’t consider refinancing us unless I go back to a PAYG job or have been contracting for at least a year. Our home has been on the market for 3 months but we haven’t had any reasonable offers. Due to time running out before our third child arrives, we believe the only solution is to rent out our home and also rent ourselves. We’ve been quoted from a real estate agent that we should receive $200.00 rental income per week on our home and it will cost us between $250-$270 per week to rent ourselves. We realise that by renting our home out that we will have to pay capital gains tax when we do sell our house, but it’s only on the gain from the value of the house now and when we do sell, so in reality we aren’t any worse off. The plan is to rent until we can either sell our home or after i’ve been contracting for a year. We believe renting ourselves is the only solution at this point in time, but perhaps others can offer some other solutions or advice?

thanks.