I am not sure if your dog is doing both or just number 2 on the balcony as well as the carpet. I am not an expert on this but I have two dogs as well -they are the same age. I tried potty training them together which seemed to work at first. Eventually my girl dog told me when she had to go out but boy dog could have cared less. Starting having the same problem you are having...my girl dog just figured she didn't really care any more either. I spoke with my vet and told him with her it was primarily just number 2 she started doing in the house. Vet said this is perfectly normal and it is a sign of them testing me. They simply do number 2 in the house as a relapse to see if it can still be done. I started walking me dogs separately so they understood there was no play time outside. Business was to be done then back in for play time. They were put on a schedule and it took no time for both of them to understand that outside was for potty time. They are walked with a harness but potty time is with a collar so this helped them to understand which was play and which was business. Hope this helped in some way and hope it wasn' t too long for you.