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Why The Iran Conflict's Impact On U.S. Real Estate Hinges On When It Ends
March 17, 2026
The escalating U.S. war with Iran is spreading through the Middle East as Iran strikes back at what it defines as Western assets around the Persian Gulf.
The explosions across the region are the latest geopolitical jolt to rattle a global marketplace already unmoored by a trade war. The timing is awkward for real estate markets, which entered 2026 with transaction volumes accelerating as debt costs moderated, helped along by loosening monetary policy.
Department of Defense
A sailor conducts a preflight check aboard the USS Gerald R. Ford on March 2. The U.S. spent $11B in the first six days of its Iran bombing campaign.
Oil markets are the front line of the war’s economic stakes, but the energy sector’s tendrils touch every part of the global economy, leaving the corporate world in the direct line of fire of the war’s second-order impacts.
As oil markets swing on news of tankers being attacked by drones and U.S. sanctions on Russia being lifted, analysts and investors say the impacts of the war on the broader economy hinge on how long it lasts. The upheaval complicates the commercial real estate market rebound that had been picking up pace throughout last year.
“Coming into 2026, we all wanted to see that improvement continue, and so far, it has,” Marcus & Millichap CEO Hessam Nadji told Bisnow on Thursday. “But six more months of what we're seeing in the Middle East, and the effect on interest rates and inflation could start to disrupt that — to say nothing about the impact on consumers and, ultimately, companies in terms of their hiring decisions.”
Most analysts forecast that a short-lived war will pass over markets like a storm, with equity, debt and bond pricing returning to something of a prewar mean if a quick resolution is reached. But as the effects of bombs exploding around the region compound, a prolonged crisis has the potential to stall out the rising activity in real estate markets, derail the Federal Reserve’s inflation fight and sap growth from the broader economy.
“Things will definitely have repercussions if they're stretched beyond a matter of months,” Nadji said.
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The explosions across the region are the latest geopolitical jolt to rattle a global marketplace already unmoored by a trade war. The timing is awkward for real estate markets, which entered 2026 with transaction volumes accelerating as debt costs moderated, helped along by loosening monetary policy.
Department of Defense
A sailor conducts a preflight check aboard the USS Gerald R. Ford on March 2. The U.S. spent $11B in the first six days of its Iran bombing campaign.
Oil markets are the front line of the war’s economic stakes, but the energy sector’s tendrils touch every part of the global economy, leaving the corporate world in the direct line of fire of the war’s second-order impacts.
As oil markets swing on news of tankers being attacked by drones and U.S. sanctions on Russia being lifted, analysts and investors say the impacts of the war on the broader economy hinge on how long it lasts. The upheaval complicates the commercial real estate market rebound that had been picking up pace throughout last year.
“Coming into 2026, we all wanted to see that improvement continue, and so far, it has,” Marcus & Millichap CEO Hessam Nadji told Bisnow on Thursday. “But six more months of what we're seeing in the Middle East, and the effect on interest rates and inflation could start to disrupt that — to say nothing about the impact on consumers and, ultimately, companies in terms of their hiring decisions.”
Most analysts forecast that a short-lived war will pass over markets like a storm, with equity, debt and bond pricing returning to something of a prewar mean if a quick resolution is reached. But as the effects of bombs exploding around the region compound, a prolonged crisis has the potential to stall out the rising activity in real estate markets, derail the Federal Reserve’s inflation fight and sap growth from the broader economy.
“Things will definitely have repercussions if they're stretched beyond a matter of months,” Nadji said.
