I think you are missing a very important consideration which is capital gains taxes. I get the idea that this is your personal residence. If so you can sell and take advantage of the $250K capital gains exclusion.
If you convert it to a rental and hold it for more than 3 years, you will be faced with capital gains taxes on the money you have already pulled out!!
Ask yourself how much appreciation would be required just to break even if you rent this house for the next 3 years. Also consider the advantages to selling a home that you owner occupy.
A tenant occupied property will rarely sell for as much as an owner occupied property. If you try to sell a single family rental, the tenant has a motivation to sabotage the sale. He may interfere with showing, refuse to keep the place clean and picked up, and bad mouth the property to prospective buyers. You can always vacate the property but then you increase your negative cash flow.
If you owner occupy the house, you can keep it clean and cooperate with showing.
