I would suggest to have a RE professional do a market analysis on your current condo and find out what is truly worth, also ask for going rents in the area. If it is possible to keep the condo, rent it until prices rise a bit, and transition to a new home that would be ideal - as long as you are willing to be a landlord. It is not for everyone! Also, it may or may not be possible depending on what kind of program you are planning to use for your new home purchase. I was in a similar situation last year and ultimately decided to keep my current home and rent it, and we bought a new home. It was tight, but manageable. We now call that house our "college tuition home" as we plan to keep it until our kids are college bound! Just in this past month I have met with two others in this situation as well. One has decided to list at a price barely avoiding short sale, and the second is holding out a bit longer! Feel free to email me your condo address and I can take a quick look and have a candid conversation with you regarding the current situation.