We have the option of selling our current house (Portland, OR), taking the profit and moving into our rental property in another city (Maple Valley, WA) to be mortgage free. It means we could work part time, raise a kid in a MUCH better area, be a little bit closer to family, and still be a one car household. The cons are is that it's a small town (20,000 people), employment options limited vs current city, not much entertainment (suburbs). The house is 1 mile from library, grocery store, parks, etc....very bikeable. It is closer to lakes, rivers, trees, outdoor options, etc..
Current house is 5 min walk to everything we need, near light rail, etc.. It's also near a freeway that get 150,000 cars a day and we both work full time and plan to have our first child in a year.
We're at a crossroads.