to sell or not to sell?

first of all let me say that Im not into getting rich quick   im happy to take it slower over the next 5 years seeing as at the moment we only have one income in the house due to me being a SAHM to young kids under 5 years old.

my hubby and i have decided we want to relocate our family from the current mining town we are living in – Moranbah, and move back to the way bigger town where we both grew up – Mackay.  we've decided to do this at the end of 2011 so the kids can go to a specific school when they start primary in 2012.

the reason we are thinking so far ahead if whether to sell or not is because if we are wanting to sell we want to get started on prepping the unit for the sale ASAP so we can increase the rent according to the unit value.  i figure itd be bad to present a unit to a potential buyer when the rent is low because I rushed the renovations at the end just before it went on the market, while the rental lease was established on the previous market value of the unit.  if u get what i mean.

current situation:
IP#1:  recent bank valuation done = $245,000.  bought for $98,000 in mid 2005.  PPOR before it became an IP.  rent = $290p/w.  its getting old but is still in solid condition.
IP#2:  purchased july this year = $250,000.  renovations $14,000 (another $20,000 in an upcoming restump in 12 months).  current value = $320,000.  rent = $340 p/w
we are currently living in a house provided by hubby's work so only $100 rent.

wanting to purchase a PPOR in 2011 for about $400k which we plan on living in for 3 years, then turning it into an IP while we purchase a new PPOR.

possible scenario one:

IP#1 is a 2 bed unit whereas IP#2 is a 3 bed + study house.  we find that having a unit IP is a bit annoying as we have to ask permission for everything and our body corporate bills are high.  rates are the same as a house.  plus our body corporate is very slow at getting things done.  so we must admit that this investment is a bit annoying at times.  the good thing is that it makes us $.  also, the unit is getting quite old so we are unsure at how much future growth is in it as the land is small.

IP#1 stops being capital gains tax exempt at the very end of 2011.  so we sell this in early 2011.  just say hypothetically for the purposes of this example that it sells for the bank valuation we got in july – $245k.  we pay off our $165k IO mortgage on it (its this high because we added the deposit for IP#2 + renos to this mortgage when we refinanced it) and we walk away with about $80,000.

we use this money to fund a 20% deposit on a PPOR in Mackay with an offset facility.  if there is any money left (doubtful) I put it into the offset account and continue to put our extra payments in there.

keep IP#2 as it has an IO mortgage of $200,000 and although Im unsure how much itll be worth in the future market, as for now its worth $320,000.  current monthly IO repayment is $807 whereas it brings in $1360 a month in rent.

possible scenario two:

keep both IPs.  ignore the capital gains tax exemption.  redraw some equity to fund a 20% deposit on a $400k PPOR.

possible scenario three:

sell both investment props and walk away with maybe $200k-ish.  pay my 20% on a deposit for a $400k PPOR out of that and then slap the rest into the offset account.  so ultimately im now paying off a low $200,000 mortgage for my PPOR, but then id have to start my IP portfolio off again.  make $700 a week payments onto the loan, after the 3 years ill have a principal of about $150,000 (going off an interest rate of 7%) while the house would hopefully be worth about $500k.

any thoughts or preferences to any of these scenarios?  i am leaning towards scenario one as although the unit has been a solid investment its starting to annoy me.  but i see value in all three of them. so im very confused as to which path we should be planning to undertake.  im very new to this so opinions from you investers is greatly appriciated  

thanks so very much in advance! 

Karen