The tariffs are part of what the White House has described as a bid to halt illegal immigration alongside the flow of fentanyl and other illegal drugs from entering the country.

The president seems to be less emphatic in implementing tariffs on the UK, saying, “I think we could very well end up with a real trade deal, where the tariffs wouldn’t be necessary… I think we have a very good chance at arriving at a very good deal.”

The same cannot be said of other nations, including America’s neighbours.

US tariffs of 25% have been implemented against goods from Canada and Mexico, while China’s imports have been given a 20% tariff, up from the 10% tax announced in February.

However, increased import charges have not been contained to just select trade partners. Last month, it was announced that the cost to take aluminium and steel over America’s borders would rise to 25% “without exceptions or exemptions”.

After winning the election in November 2024, some finance professionals highlighted possible tariff increases as well as higher interest rate environments, but what might the recent import tariff rises look like over here in the UK and how could it affect the specialist finance market?

According to Jonathan Samuels, CEO at Octane Capital, if there were to be any impact on the UK specialist finance market from import tax hikes it would be to GDP growth, which would impact taxes and interest rates.

“The most likely outcome is that UK GDP is hurt by a global slowdown triggered from US inflation rising with the cost of goods,” he said.

“Tariffs will mean the cost of anything with steel and aluminium in it will go up.

“If US inflation increases, then the Fed will have to increase rates. Other countries directly affected with tariffs will do the same and the global economy will stall.

“All of this means Rachel Reeves (or ‘Rachel from accounts’ as some call her) will need to increase taxes, which is bad for property prices.

“The counterintuitive saving grace is that, if the economy slows down and taxes increase, this is all deflationary and the BoE will likely lower rates which is good for property prices.”

Jonathan continued: “[It’s] not a straightforward picture, but what is right now?”

Other industry professionals felt that rises in import taxes could have a greater impact on the market. Matthew Martin, director at Align Property Finance, was in “no doubt” that the specialist finance market would suffer.

•   The Finance Professional Show 2024: The Video
•   What could US import tariffs mean for the UK specialist finance market?
•   Bridging market set to grow following wave of US and Middle Eastern investment

“Lenders’ response may well be increased interest rates due to the potential increased risk, especially for businesses in sectors heavily affected by tariffs. Thus, making borrowing more expensive for both businesses and consumers.

“They could even go a step further with the increased economic uncertainty and higher risk causing lenders to tighten their lending criteria, making it more difficult for businesses and consumers to access liquidity.”

Matthew highlighted that higher tariffs on imported goods into the States could also reduce revenue for the businesses that rely on exporting products, leading to a fall in profitability and cashflow and making it difficult for them to secure financing.

However, he noted it wasn’t simply the consumer who would feel the hit: “Brokers’ roles could become more challenging when it comes to aligning clients and lenders due to the potential stricter criteria and higher interest rates,” predicted Matthew.

“Ultimately and, inevitably, increased costs for businesses leads to increased prices for consumers, reducing their disposable income and spending power. This inflationary ripple effect will further impact the economic uncertainty and the vicious cycle continues.”

With certain imports into the USA hit with greater tariffs, it is anticipated to burden American consumers. Some feel that this won’t be isolated to just US prices, but will spread across other countries, rising prices and putting a strain on housing markets here in the UK.

“The increase in material costs due to the tariffs will certainly impact the property industry, particularly in cases where materials cannot be locally obtained,” commented Michelle Walsh, head of intermediary sales at Together.

“This surge in costs is expected to elevate the expenses associated with constructing new residential and commercial properties, consequently diminishing the profitability for property developers.”

Michelle feels that heightened material expenses, coupled with existing housing scarcity, may lead to a decline in new development projects, or make housing less affordable if costs are passed on to consumers.

“This decrease in profitability is particularly likely to constrict the availability of development finance, crucial for property construction endeavours. Developers may require additional flexibility from lenders to ensure their projects remain viable. An example would be leveraging equity from properties within their portfolio.”

However, Michelle believes this could lead to a rise in activity for the specialist finance market, if tailored solutions become more necessary.

“As a result, we may in fact see an increased demand for specialist lenders as customers search for adaptable affordability solutions and product offerings to counterbalance the increasing building costs.”