Iran-Israel Conflict Hits India's Real Estate: Supply Disruptions & Rising Costs Delay Project Possessions

Mumbai: The ongoing geopolitical tensions in West Asia, particularly the Iran–Israel conflict, have The ongoing geopolitical tensions in West Asia, particularly the Iran-Israel conflict, have begun to weigh on India’s real estate sector. Developers are flagging delays in project completion due to supply chain disruptions and rising input costs.

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Shortage of tiles & sanitaryware emerging as critical concern

Industry stakeholders said shortages of key finishing materials such as tiles and sanitaryware, driven largely by gas supply constraints, are emerging as a critical concern. These disruptions are expected to push possession timelines, especially for projects in advanced stages.

CREDAI-MCHI Chief Operating Officer Keval Valambhia noted that the war has led to significant supply-side challenges. Shortages of gas and LPG have impacted the production of energy-intensive materials like supply of tiles from Morbi, which supplies over 80% of the market need. “Distributors have increased prices due to limited availability, but the situation remains manageable currently,” Valam bhia said. He warned that if the conflict continues, project possession timelines could extend by two to three months.

Marble & tile industry hit hard: 80% of factories shut down

The marble and tile industry has been hit particularly hard. Gajendra Bhandari, President of the Vile Parle Marble Association, said that nearly 80% of factories have shut down. According to Bhandari, major firms are now insisting on full advance payments and have stopped accepting new orders without prior confirmation.

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Deep Vadodaria, CEO of Nila Spaces, explained that the conflict affects projects at multiple levels. Beyond finishing materials like façade glass, core inputs like steel and cement are witnessing price pressure due to rising crude oil prices. Vadodaria described this as an indirect “wartax” on the sector, where developers deal with both cost escalations and procurement uncertainty.

Anand Gupta, a member of the Builders Association of India, said the availability of sanitaryware is hampered by chemical supply issues.

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