How the 2026 Tariff War Is Redrawing Global Property Capital Flows

Published on: July 9, 2026

Last verified: 9 July 2026. This article describes law, litigation, and market data as published. It contains no political position and no investment advice.

On 20 February 2026, the United States Supreme Court held 6-3 that the International Emergency Economic Powers Act does not authorise the President to impose tariffs.

Within hours, the administration issued Proclamation 11012, invoking Section 122 of the Trade Act of 1974 to impose a 10% ad valorem surcharge on virtually all imports, effective 24 February 2026.

Section 122 caps tariffs at 15% and limits them to 150 days without an act of Congress.

That clock runs out on 24 July 2026, fifteen days from the date of this article.

Almost no one writing about global property has connected this to real estate. It connects directly, through three mechanisms, and the evidence for one of them will land within the next week.

Part 1: What actually happened, in order

Because this area has generated an unusual amount of loose reporting, the sequence matters.

Two legal points that are frequently garbled:

The Court did not rule on refunds. The majority opinion is silent on remedy. Estimates of IEEPA duties collected vary by measurement date and scope, US Customs and Border Protection reported roughly $133.5 billion collected under IEEPA as of mid-December 2025; the Penn Wharton Budget Model projected cumulative collections of about $164.7 billion through January 2026 and up to $175 billion in potential refunds. Other estimates cited in the litigation exceed $200 billion. Refund mechanics remain unresolved and are being worked out through the courts and CBP.

Section 122 is not the ceiling. Section 301 and Section 232 remain fully available and carry no statutory time limit and no rate cap. Multiple firms tracking the matter, Holland & Knight, Skadden, Gibson Dunn, expect the Section 301 investigations to conclude in time to produce replacement tariffs before or around 24 July.

The practical read: the legal instrument changed twice in five months. The policy did not.

Part 2: The three channels into real estate

Property people tend to treat trade policy as someone else's problem. It is not, for three reasons.

Channel 1: The discount rate

Tariffs are a tax on imported goods. They raise input costs, feed into consumer prices, and complicate a central bank's inflation path. That path sets the risk-free rate. The risk-free rate sets the discount rate. The discount rate sets what every income-producing building on earth is worth.

Cushman & Wakefield's early-2026 capital markets review captured the mechanism without drama: benchmark rates have come down from their highs, but "upside volatility has been reignited, particularly as geopolitical developments have reintroduced uncertainty around the inflation outlook and the future path of monetary policy." For real estate, they note, this "will likely reinforce sensitivity around exit assumptions and refinancing risk."

That is the entire story of 2026 underwriting in one sentence. Nobody is repricing assets because of tariffs. Everybody is repricing exit assumptions because of what tariffs do to the rate path.

Channel 2: Currency, and the cost of being foreign

A cross-border buyer holds two positions: the building, and the currency it is priced in. Trade policy moves currencies. A tariff regime that is imposed, struck down, replaced, struck down again, and appealed produces exactly the kind of policy volatility that shows up in exchange rates before it shows up anywhere else.

For an individual buying a €300,000 apartment, a 5% currency move is €15,000, larger than a year's net rent in most European markets. Most buyers model the yield to two decimal places and the currency not at all. Our guide to currency risk in international real estate is the one to read before you wire a deposit.

Channel 3: Reciprocity, and the closing of doors

This is the channel that will matter longest.

When trade becomes an instrument of leverage, capital becomes an instrument of leverage too. Governments that feel exposed to foreign economic pressure tend to become more restrictive about foreign ownership of domestic assets, and housing is the most politically legible asset there is.

Australia offers the cleanest example. Its temporary ban on foreign purchases of established dwellings, in force since 1 April 2025, was extended in the 2026-27 Budget to 30 June 2029, per the Australian Taxation Office. Foreign persons, including temporary residents and foreign-owned companies, cannot buy an established dwelling, with limited exceptions for purchases that significantly increase housing supply.

Note the design. It does not ban foreign capital. It channels it, into new construction, away from existing stock. That is the template, and versions of it are spreading. We track the wider pattern in why countries are banning foreign property buyers.

For a cross-border buyer, this is the most consequential development of the decade, and it has almost nothing to do with tariff rates. It has to do with the political climate that tariffs both reflect and reinforce.

Part 3: What the flow data actually shows

Here is where most commentary goes wrong. It asserts that trade conflict is driving capital out of the US, or into gold, or into safe havens. The published data supports a subtler and more interesting story.

Global transaction volumes are up, not down. JLL recorded US$216 billion in global direct real estate transactions in Q1 2026, up 18% year-on-year. Asia-Pacific led with 31% growth; the Americas rose 25%; EMEA fell 2% against a strong comparable.

Cross-border investment is up sharply. JLL put Q1 2026 cross-border investment at US$55 billion, up 37% year-on-year, the strongest first quarter since 2022.

And it is spreading out. This is the sentence to underline: EMEA received 40% of cross-border investment, with the Americas and Asia-Pacific each receiving 30%, which JLL describes as the most even distribution of cross-border capital on record.

Capital is not fleeing. Capital is diversifying jurisdictionally. That is what an investor class does when it stops assuming any one legal regime is permanently reliable.

A supporting detail from Cushman & Wakefield: only 26% of cross-border transaction activity in the US has gone to new acquisitions, with the majority concentrated in refinancing and recapitalisation of existing assets. Foreign capital has not exited the US. It has stopped adding.

Part 4: The data point that does not exist yet

The National Association of Realtors publishes an annual profile of international transactions in US residential real estate, covering the twelve months to March.

The 2025 edition, covering April 2024 to March 2025, reported that foreign buyers purchased $56 billion of US existing homes, 78,100 properties. Volume was up 44%, the first year-on-year increase since 2017. The median foreign-buyer purchase price of $494,400 was a record high. 47% paid all cash, against 28% of buyers overall.

NAR's own release contains a sentence that almost every downstream article omitted:

The survey captured data before new tariffs were announced in April 2025.

Which means: the 2026 edition, covering April 2025 to March 2026, is the first complete measurement of foreign residential buying through the tariff period. It is published in mid-July. As of this writing, it is not out.

When it lands, it will be the single cleanest natural experiment available on whether trade conflict deters foreign property buyers, and it will be read by everyone. If you take one thing from this article, take the date.

We will update this piece when it publishes.

Part 5: The confound you must not ignore

Anyone who attributes 2026's capital-flow patterns solely to tariffs is selling something.

On 1 March 2026, the United States and Israel carried out coordinated strikes on Iranian military and nuclear infrastructure. JLL described the resulting conflict as a "state-altering shock" to the global economy in Q1. Cushman & Wakefield dated the modest widening in EU high-yield credit spreads to precisely that event. Wynn Resorts cited Middle East shipping disruption when flagging a possible delay to its $5.1 billion Ras Al Khaimah resort.

Energy prices, shipping routes, insurance costs, and inflation expectations all moved. Disentangling the tariff effect from the conflict effect is, at this distance, not possible with public data.

Honest version: 2026 has two simultaneous macro shocks and one set of flow statistics. Treat any confident single-cause explanation, including a confident one that agrees with you, as a hypothesis.

Part 6: What actually changes for a cross-border buyer

Not much, immediately. Quite a lot, structurally.

1. Watch 24 July, then watch Section 301.
If Section 122 lapses without replacement, covered imports revert to MFN rates plus existing Section 232 and China Section 301 duties. If Section 301 actions land first, the tariffs become durable, no 150-day clock, no 15% cap. The second outcome is the one that changes long-run inflation and rate expectations. Most trade counsel consider it more likely.

2. Assume policy risk is now priced into jurisdiction, not just into property.
The question "is this a good building" has been joined by "is this a government that will still let me own this building in 2032." That question used to be reserved for frontier markets. It is now a mainstream diligence item in developed ones.

3. Prefer markets that channel foreign capital rather than block it.
Australia's approach, closed to established stock, open to new supply, is more informative than a blanket ban, because it tells you exactly what the state wants. Read the design of the restriction, not just its existence.

4. Underwrite the exit, not the entry.
Every institution quoted in this article is saying the same thing in different words: pricing is holding, but exit assumptions are where the risk now lives. A retail cross-border buyer has less liquidity than an institution and a longer holding period. Act accordingly.

5. Currency is not a footnote.
If policy volatility is the new baseline, FX volatility is too. Know your exposure. You do not have to hedge it. You have to know it exists.

Frequently asked questions

Did the Supreme Court end tariffs?
No. It held that one statute, IEEPA, does not authorise them. Section 232, Section 301, and (temporarily) Section 122 remain available. Tariffs continued without interruption.

When do the Section 122 tariffs expire?
24 July 2026, 150 days after their 24 February effective date. Only Congress can extend them. The President cannot.

Are tariff refunds happening?
The Supreme Court did not order them. Refund processes are being worked out through CBP and further litigation. Importers have been advised by counsel to preserve entry records and monitor protest deadlines. Whether refunds reach consumers or downstream purchasers is a separate and unresolved question.

Are foreign buyers leaving US real estate?
The most recent complete NAR data (April 2024 to March 2025) showed foreign buying rising 44% by volume, but that period ended before the April 2025 tariffs. The next edition covers the tariff period and is due imminently.

Is cross-border property investment falling?
No. JLL recorded $55 billion of cross-border investment in Q1 2026, up 37% year-on-year and the strongest first quarter since 2022. What has changed is its distribution: EMEA 40%, Americas 30%, Asia-Pacific 30%, the most even split JLL has recorded.

Related reading

• Why countries are banning foreign property buyers
• Capital flight after Russia-Ukraine: the new route of money
• Currency risk in international real estate
• Buying property in Ras Al Khaimah

This article is informational and reflects publicly available information as of 9 July 2026. It is not legal, tax, or investment advice. Trade litigation and tariff authority are moving quickly; the Section 122 position in particular may have changed after publication. JanusHermes takes no position on the merits of any trade policy discussed. Verify current law before acting.

Sources

• Learning Resources, Inc. v. Trump, 607 U.S. ___ (2026), decided 20 February 2026; Congressional Research Service Legal Sidebar LSB11398
• Proclamation No. 11012, 91 Fed. Reg. 9,339 (25 February 2026)
• Oregon v. United States & Burlap and Barrel, Inc. v. United States, Slip Op. 26-47 (Ct. Int'l Trade, 7 May 2026); Federal Circuit administrative stay, 12 May 2026
• Penn Wharton Budget Model, Supreme Court Tariff Ruling: IEEPA Revenue and Potential Refunds (20 February 2026)
• Holland & Knight, Skadden, Gibson Dunn, Norton Rose Fulbright, K&L Gates, PwC, client alerts, February to May 2026
• JLL, Global Real Estate Perspective (May 2026), Q1 2026 transaction and cross-border data
• Cushman & Wakefield, Cross-Border Capital and CRE: Early 2026 Signals (2026)
• National Association of Realtors, 2025 International Transactions in U.S. Residential Real Estate (14 July 2025)
• Australian Taxation Office, Banning foreign purchases of established dwellings; Budget 2026-27

A note on the numbers: where no source is named, the market figures in this article (prices, yields, costs) are indicative estimates compiled from publicly available market data and industry reporting at the time of writing. Markets move and rules change, so treat them as a starting point and verify current figures with official sources before acting on them.