So the Rockets made it official announcing they won't be picking up Parsons option. Parsons, who's been an integral piece off this rockets team for the past 2 seasons has become a highly sought after player. Basically the Rockets would rather get a superstar player than resign Parsons to a big money deal. They'll undoubtedly have to because other teams are going to as well. Rockets GM Daryl Morey is stuck trying to figure out what to do.
Personally I'd say to trade Parsons. At least then they'll get something for him rather than just letting him walk. Best case scenario, they can strike a deal with the Magic and land another high draft pick next season. Parsons is from Orlando, and played his college ball at the University of Florida. The Rockets will be collecting a draft pick from the Pelicans for Omer Asik as soon add that trade is finalized. If they're able to get another 1st round pick they'd have another piece to trade, for yet another great player such as Kevin Love our even Rajon Rondo. If Parsons leaves and the Rockets get absolutely nothing for him it'd be a disaster in my eyes.
Some say that superstar is possible without trading Parsons, and if that superstar isn't a SF then trading him wouldn't be necessary. But paying Parsons will be the issue. With both Dwight Howard and James Harden getting max contracts it'll be hard to figure out what to pay Parsons. Add in the fact that the Rockets were anticipating paying someone else a max deal as well, which would leave only scraps for Parsons.
If Parsons is willing to take less money to win, the Rockets should keep him. Regardless of whether they get Melo or not. Parsons is one of the top players in the league at his position and keeping him would only make the Rockets better. But if paying him what he wants isn't possible... get something for him.