Purchase $($$$720,000)$ and Monthly rental $($$$3,600),$ please answer the following questions:

What would be monthly mortgage payment if your friend decides to buy? Rate: $5\mathrm{.}00\%$ semi$-$annual compounding over $25$ years amortization.

What would be the principal outstanding amount on mortgage after $5$ years?

What is the annual household income required to qualify for the required mortgage? What is your understanding of Canadian mortgage stress test and how it is used to calculate mortgage qualification? Assume that your friend does not have any credit card debt, vehicle loan liability or other loans.

What would be your recommendation to your friend $-$ the rent or to buy? In your analysis, you will need to consider $3$ possible condo price scenarios, factoring in qualitative consideration.

Price of condo remains unchanged after $5$ years.

Price of condo increases by $10\%$ after $5$ years.

Price of condo decreases by $5\%$ after $5$ years.