It sort of sounds like the previous owner was a heavy dude with a heavy sample case he always put behind him. But I don't think that without actually seeing under the car, any of us is likely to get a 100% correct diagnosis about what the problem is. And of course, we can't solve the problem if we don't know what the problem is.
You need to put the car on a lift and take a look at the shocks and springs. The spring pads are " safe" and won't fall out, but they will get squished after 20 years or so. The yellow plastic things that slide on at the top of each front shock of my 1990 124 body 300D were about half eroded in 2000 and if the 123 has a similar problem, then you I'd say that your car will stop sagging if you replace them, along with perhaps springs, spring pads, and shocks, you are likely to solve the problem.
You could measure a new spring and then get a pair of springs that measure the same height in a junkyard for a lot less. Just make sure they are identical to one another. I would think it a good idea to replace springs in pairs.
But I would say that your next step is definitely to put it up on a lift and see what it looks like underneath.
Semibodacious Transmogrifications a Specialty
1990 300D 2.5 Turbo sedan 171K (Rudolf)
1985 300D Turbo TD Wagon 219K (Remuda)
"Time flies like and arrow, yet fruit flies like a banana"