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Today in property: CEOs implore RBA not to cut rates, auction rates holding, lender comp heating up

Tomorrow's the big day for the RBA - but should they cut?

The Reserve Bank meets tomorrow to make the call on interest rates. As we know, a cut is expected after RBA governor Philip Lowe said that's what's we're likely to see in a speech a fortnight ago. The ANU's "shadow RBA board" of economists have called it - but interesting to note they're only 50 per cent sure of a cut tomorrow.

The front page of today's AFR features a group of CEOs and chairmen who are urging the RBA to think again, and not cut the official cash rate. Their argument? If things go bad from here with the economy, the RBA will have nowhere to go on monetary policy.

The editors of the Fin agree. They're saying the case for a rate cut tomorrow isn't strong enough. And as we've been hearing from a parade of economists since before the election, it's questionable whether a rate cut would make any material difference for home buyers anyway. Especially given the RBA's chief role is to keep Australia's economy in positive growth, the board will no doubt be taking these voices seriously.

It's a particularly timely conversation with the the release of the first quarter National Accounts this coming Wednesday. This chief measure of national growth will tell us just how weak GDP really is - but expectations are that it'll show we're currently at GFC levels of economic growth.

Meanwhile however, the housing market is looking stronger than it has in a long time. Auction clearance rates held over the weekend, with Sydney on 66.1 per cent and Melbourne 64 per cent. Tim Boyd's subeditor even dared but the acronym FOMO to print on his story in the Fin last Friday, telling the tale of buyers who are rushing to get in ahead of an RBA rate cut and predicted subsequent hike in house prices.

It's thrown fuel on the fire of gathering competition between lenders, with a grab-bag of home loan products with a 3 in front now available across a range of financial institutions. But as CommSec chief economist Craig James pointed out late last week, we're yet to see this flurry of more attractive home loan products translate into an increased demand for debt.

Over to Camp Albanese, and the shadow cabinet has been unveiled. All eyes seem to be fixed on the title fight between Peter Dutton and his newly-minted opposite number, Kristina Keneally. For all you property types though, the government's minister for housing, Michael Sukkar will now have Western Sydney Labor MP Jason Clare to contend with in the shadow ministry.

To the states, and the property sector is up in arms over the Victorian government's plans for new stamp duty rules announced last week. The lobbyists will need to move fast; the legislation changes were tabled in Parliament last Tuesday. NSW property developers and builders take note: with billions in lost stamp duty revenues being wiped from the coffers, we can expect to see some pretty heavy recouping measures coming in next month's state budget.

If you're feeling like a flutter on the timing and nature of a housing recovery, UBS has laid out the four most likely scenarios over at The Urban Developer. Time to start that office pool.

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