Should I do a short sale on my underwater mortgage?

Although I love my house because of the comfort it provides, we have outgrown it (family of 6 in a 2 bedroom, 1100sf). We cannot sell because we’re upside down 60K. We owe 130K, the house is only valued at 70K now. Our mortgage is affordable for us, and our payments are current. The thought of renting is terrible, so is the thought of our children losing the only home they’ve known. We love our two dogs and wouldn’t want to lose them, we love having a spacious front & back yard…all ours to do whatever we want with. However, we can rent homes with twice the living space on our same street for less than what we pay for our mortgage. Just want to know what the best financial move for us would be, I’m at a loss.
We didn’t add onto our mortgage at all. & about a year before we bought the house it was listed at 180K, and when we put the offer down they wanted 150k. We live in California, that might help lol

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