The RBA has raised the cash rate to 4.35%, marking the third increase this year as inflation pressures continue across fuel, housing and everyday living costs. With repayments rising and further increases still possible, now is a good time for borrowers to review their loan structure and overall finance strategy. We explore the growing trend of buying property with family, friends or business partners, including the key lending, ownership and legal considerations to think about before purchasing together.
The Reserve Bank of Australia (RBA) raised the cash rate to 4.35% at its Maymeeting – the third increase this year and a clear signal that the fightagainst inflation is far from over.
Headline inflation rose 4.6% in the 12 monthsto March 2026, according to the Australian Bureau of Statistics, up sharplyfrom 3.7% in February. The biggest contributors were transport, up 8.9%, drivenby a 24.2% surge in automotive fuel, and housing, up 6.5%, with electricitycosts rising 25.4% and rents up 3.7%.
The RBA's preferred measure, trimmed mean –which strips out volatile price movements – held steady at 3.3%, still wellabove the 2–3% target band. In other words, underlyinginflation isn't being driven solely by fuel prices. Price pressures arebroad-based, which is a key reason why the RBA is unlikely to ease off quickly.
For borrowers, the cumulative effect ofthree rate rises in 2026 is significant. According to Canstar, each 25 basis point increase addsroughly $90–$150 per month to repayments on a $600,000–$1 million home loan. With threerises now locked in, now is a good time to review your position and make sureyour loan structure is still working for you.
The pressure is being felt across theeconomy. While higher fuel prices and interest raterises are expected to slow spending, the RBA's focus remains squarely onbringing inflation back under control, and further moves cannot be ruled out.
For those with property plans – whetherbuying, investing or developing – this environment demands a more strategicapproach to finance. In the current environment, thefocus should not only be on the interestrate itself, but whether your overall lendingstructure is giving you flexibility, liquidity and control as market conditionscontinue to evolve.
Co-buying property is becoming increasingly common in Australia – whether to enter themarket sooner or to build a portfolio together. However, shared property ownership comes with importantfinancial and legal considerations, and how you structure things from theoutset can have a significant impact on flexibility, risk and future outcomes.
One of the first considerations isownership structure. Buyers engaged in sharedproperty ownership typically choose between joint tenants and tenants incommon. Joint tenants means equal ownership, while tenants in common allowsdefined shares that can reflect different financial contributions.
Another option for co-buyingproperty is a trust structure, where a trustee holds the property onbehalf of beneficiaries. This can offer flexibility in income distribution andownership, though lending is often more complex and subject to additionalrequirements.
From a lending perspective, most lendersassess all borrowers collectively, meaning each person is generally responsiblefor the full home loan. If one party cannotmeet repayments, the others may need to step in. Lenders will assess eachborrower's income, liabilities and credit profile when determining borrowingcapacity.
It's also important to consider howcontributions are managed and to document this clearly. Many co-buyers put alegal agreement in place covering responsibilities, exit strategies and whathappens if circumstances change.
Finally, think about future flexibility.Will one party want to buy the other out, or could the property become aninvestment? Structuring the loan with features such as offset accounts or splitfacilities can provide greater control over time.
The right structure for co-buying property depends on your relationship,financial position and long-term plans. Getting legal and finance advice earlycan help avoid issues later.
Whether you're reviewing existing lending, planning your next acquisition or navigating a changing rate environment, 3LANE Finance can help structure the right solution for your circumstances.
Will my bank automatically raise my ratefollowing the RBA decision?
Most lenders pass on RBA rate rises tovariable rate borrowers, though the timing can vary. Fixed-rate borrowers areunaffected until their fixed term ends. If you're unsure how the latest riseaffects your home loan, it's worth speakingto your finance broker.
Are further rate rises likely in 2026?
Possibly. Most economists expect the RBA topause and assess the impact of three consecutive rises, though some forecastershave flagged the possibility of further increases later in the year ifinflation remains sticky.
Should I consider fixing my loan givenwhere rates are heading?
It depends on your circumstances. Fixinggives you certainty over repayments but means you won't benefit if rates fall,and you may lose access to features like offset accounts.
Can I refinance if myborrowing capacity has reduced?
Potentially, yes –though it depends on how much your capacity has changed and your currentloan-to-value ratio. Some lenders have more flexible assessment criteria thanothers, and a finance broker can help identify options that may not beavailable through your existing lender directly.
Can I buy property with someone if wehave different incomes?
Yes, lenders assess all applicantstogether, though differences in income may affect borrowing capacity and howownership is structured. This is particularly worth discussing with a brokerwhen purchasing property with family or friends.
What happens if my co-buyer can't meettheir repayments?
On a joint loan, both parties are fullyliable for the entire debt, regardless of their individual share.
What happens if I own property withsomeone, but they want to sell?
This depends on your ownership structureand any legal agreements in place. Planning an exit strategy early, ideallybefore settlement, is strongly recommended.
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