Will US tariffs alter the landscape of luxury and affordable housing in India?

Geopolitical tensions and proposed US tariffs may challenge the luxury appeal of Trump-branded residences while also dampening the affordable housing market

Real estate experts say geopolitical tensions could erode the appeal of one of the most recognisable names in ultra-luxury branded residences, Trump. The brand has long symbolised exclusivity, luxury benchmarks, and global prestige and the current political and diplomatic headwinds may test its positioning. Others, however, argue that its influence is largely limited to setting luxury standards, with little impact on the actual project.

Trump tariffs: Real estate experts say geopolitical tensions could erode the appeal of one of the most recognisable names in ultra-luxury branded residences, Trump. (Representational Photo) (Pexels)

At the other end of the market, proposed US tariffs on Indian exports could dampen affordable housing sales. According to real estate consultancy Anarock, the tariffs may hurt small businesses and reduce the incomes of their employees, a key buyer segment for homes priced up to ₹45 lakh.

“Homebuying is known to be a sentimental decision. The geopolitical situation in India has had an impact on the brand Trump, and it would undoubtedly hurt the sales,” said a senior executive at Knight Frank India, noting that brand perception plays a critical role at the top end of the housing market.

While the Trump name has long been associated with exclusivity, luxury benchmarks, and global cachet, the ongoing political and diplomatic headwinds could challenge its positioning, he said.

Others believe that the brand’s role is largely limited to setting luxury benchmarks, with minimal influence on the actual project.

“High Net Worth Individuals (HNIs) and Ultra High Net Worth Individuals (UHNIs) tend to look beyond the name on the door,” said Anuj Puri, chairman of ANAROCK Group. “The brand has little to do with the actual project other than setting luxury benchmarks, a fact which actually works in their favour. These buyers focus on the overall value proposition: location, amenities, quality of construction, and exclusivity. Moreover, supply in these towers is extremely restricted, ensuring continued demand from a niche audience.”

Limited supply, exclusive access

Experts say that Trump-branded residences in India are sold in very limited numbers and are marketed to a select pool of UHNIs. This makes gauging demand through traditional metrics such as open market inquiries or secondary transactions almost impossible.

They say that the clientele for such homes considers multiple factors beyond branding, from long-term capital appreciation potential to the lifestyle offered. As such, even if the Trump brand loses some of its lustre, there will still be takers, they say.

There are currently four Trump Tower properties in Mumbai, Pune, Gurugram, and Kolkata. With more launches expected in the coming months, India will have the highest number of Trump Towers, surpassing the United States.

Will political optics influence luxury home buying decisions?

Luxury property buyers in India are no strangers to global brands, from Armani to Versace to Trump. However, the influence of international politics on purchase decisions remains debatable. For the ultra-wealthy, experts say, the real driver remains financial stability and portfolio diversification, not political headlines.

“They would potentially be affected only if their personal finances are impacted by the economic fallout of geopolitical tensions,” Puri explained. “Such individuals are generally able to make decisions without being dictated to by such considerations. All that said, we will have to wait and see how much, if any, of the brand’s sheen erodes, thus bringing down the overall value proposition."

India’s luxury housing market has been expanding steadily, driven by a rising class of globally exposed entrepreneurs, executives, and investors. Branded residences, often developed in collaboration with luxury fashion houses, design studios, or celebrity personalities, have become a distinct segment, offering not just homes, but status.

Sales of affordable homes may be hit with likely impact of US tariff on MSMEs employees: Anarock

According to realty consultant Anarock, affordable home sales are likely to be hit by the proposed US tariffs on Indian exports. This will hurt small businesses and the incomes of their staff, who are major buyers of housing properties costing up to ₹45 lakh.

Micro, Small, and Medium Enterprises (MSMEs) account for a significant chunk of goods exports to the US, and a higher tariff will make their products less competitive. This will result in reduced business orders and, in turn, adversely impact the staff employed by these enterprises.

ANAROCK data shows that in H1 2025, affordable housing accounted for just 18% of total sales, about 34,565 units out of 1.90 lakh sold across the top seven cities. This marks a sharp decline from 2019, when the segment held over 38% of the market.

The segment, defined as homes priced at ₹45 lakh or less, is heavily dependent on demand from MSME and SME workforces, which could be severely affected by the U.S. tariffs. Prashant Thakur, executive director, Research and Advisory, ANAROCK Group, said the tariffs could significantly reduce future income for this large workforce, curbing demand further and potentially leading to higher loan defaults in the segment.

"This category of homes priced ₹45 lakh or less was already gravely hit by the COVID-19 pandemic and is still struggling to find any semblance of firm ground. Trump's mercenary tariffs will snuff out even the dimmest ray of hope for this segment,” he said.

Experts say that because of the disruption in this large workforce's future income thanks to the tariffs, affordable housing demand may very possibly derail and further impact sales in this highly income-sensitive segment.

"Because of the disruption in this large workforce's future income thanks to the tariffs, affordable housing demand may very possibly derail and further impact sales in this highly income-sensitive segment," Thakur said. Further, he added that this would curtail launches of affordable homes by developers.

“Concurrently, such a drop in demand will curtail launches by developers, who will have to contend with tighter working capital due to lower sales. As it is, they have been grappling with serious input cost inflation since the pandemic," Thakur added.