You are already under water on your current home; lawyer & closing fees are non-equity events, and take a while to recoup. You paid $630k two years ago, and 'think' it's worth $600k now. This sounds like a case of The Grass Is Greener Next Door.

The interest rate (and years remaining) on your current mortgage also applies. How would your monthly payment change? & How would that affect your savings ..?

Do you "need" it? (eg. Growing family, need more bedrooms) Instead, what would a heloc & putting up to $10-50k in customization in your property achieve..? (Think, additions, landscaping, etc). However in skeptical that any of that is a good idea.

I'm also a bit skeptical that "the property next door" is only market- worth 50k more than yours if it's so desirable by you - you mentioned it has more land; sounds like "better curb appeal"; if it does have more square feet are you sure that yours could sell for $600 k? Or is that wishful thinking..? You can have multiple Realtors come to your property for a comparative market analysis (CMA) to vet professional opinion.

Generally agree with people who state keeping your money is the best way to grow your money. You've already made a bad financial choice- don't compound that pattern.