First question would be does she need to sell in order to qualify for a loan in purchasing her next place? Also, it's a little strange that a HELOC is the primary loan so you might want to check that. Does the current lender have issue if it's not a primary residence?
In regards to the rental numbers - what's included in carrying costs?
Normally, you would factor about 1/2 of the expected rent ($600/mo) to go toward things like vacancy, maintenance, property management, potential cost of litigation, potential cost of city rental license, taxes, insurance (inc. landlord policy to cover liability) and extra utilities. You then factor in your lending cost in the other half left over to come to a true expected positive cash flow estimate. I'm guessing it's not $450/mo.