Global Tariffs Surge: Can Indian Real Estate Harness the Shift?

When global trade trembles, ripple effects are felt far and wide. The world woke up on August 27 to a fresh economic jolt as US President Donald Trump enforced additional tariffs, pushing overall duties to 50 per cent. While industries brace for tighter margins and uncertain supply chains, the Indian real estate sector finds itself at a unique crossroads—facing both challenges and hidden opportunities.

A Crisis That Could Spark Opportunity

At first glance, the impact of tariffs seems like a blow to housing. Rising global trade tensions often inflate input costs, making construction more expensive. Yet, as supply chains reshuffle, developers may soon find building materials arriving at more competitive prices. This shift, experts believe, could translate into lower project costs and greater accessibility for homebuyers in India.

Atul Monga, CEO and Co-Founder of BASIC Home Loan, highlighted the bigger picture: “Trump’s tariffs may look like a setback for India’s housing sector. But government subsidies, particularly for affordable housing, continue to ease EMI pressures for low-income families. Demand for housing remains strong.”

Supply Chain Realignment: A Silver Lining

• Potential reduction in the cost of raw materials
• Boost in local manufacturing and employment opportunities
• More consumers qualifying for larger home loans

While global trade battles rage on, India’s housing market remains rooted in strong domestic demand and policy frameworks. The dream of owning a home remains steadfast in the face of global uncertainty.

RBI’s Role in Stability

In parallel, monetary policy is playing its part. The Reserve Bank of India recently kept the repo rate unchanged at 5.5 per cent, signaling stability. Governor Sanjay Malhotra reiterated the central bank’s ‘Neutral’ stance, following a 100 basis points cut earlier this year. Affordable EMIs remain a key support for aspiring homeowners amid global headwinds.

A recent State Bank of India report, however, cautions that further cuts may not arrive soon. With inflationary pressures persisting, the October 2025 policy review is unlikely to bring rate relief. Even December may prove challenging, the report noted, underscoring a cautious approach to balancing growth and inflation.

The Road Ahead

India’s housing market has weathered global storms before—and today is no different. Backed by subsidies, steady demand, and supportive frameworks, the sector may yet turn a global tariff shock into a long-term opportunity for growth.