From the sounds of your outline, I'd say you have several options available to you. The first thing I would advise would be to to do two things, just so you have all the information that might be useful: 1) seek a realtor's opinion about the rental rate for homes like yours in your area, and 2) seek out a good, conservative mortgage BANKER for his opinion of your qualifications for buying a second home. You are right, this is an excellent time to consider buying, and if you can keep and rent you current home while still moving up, all the better. Failing that, the realtor can give you a realistic sale price given the time frame you can tolerate. You have morethan a couple of questions to resolve, like what DO you have for cash to bring to the table if you have to sell your home short; do you have the 3.5 - 5% down in addition,for the dp on the new home? Etc..
Find a couple of experienced professionals to help you sort thru this opportunity.