Solution for the Housing Problem in Lebanon

I have posted something about this before, but after some thought here's another solution:

We all know the real reason why Lebanese real estate prices have skyrocketed: The Gulf Arabs. Their voracious appetite for Lebanese real estate can only be matched by their appetite for Lebanese women. Therefore a lot of Lebanese have suggested to ban them from buying property in lebanon (which they think solves the problem for real estate at least). This solution however will deprive Lebanon of much needed foreign capital and can cause a real estate burst in Lebanon not unlike the American burst with all its ramifications. Furthermore such a move could affect the Lebanese diaspora in the gulf who would be retaliated against.

Another solution that someone has suggested to me was to put a ceiling on the price of land and houses, so that a landlord can only charge so much for a property he wants to sell. One could see the hand of socialism creeping in here, and the ramification for property rights. Now the solution I will propose will have some socialist feel, but won't be as intrusive as forcing people to sell their land at some fixed price, which would end up benefiting the khaleejis anyway.

The solution would be good old taxes. A progressive tax on all real estate sales so that about 40 percent of the price of a house is paid to the government. With this money the government can build low cost housing for those who can't afford it, and subsidize the old landlords who are renting with the old rent law. The plan would aim to use the money as wisely as possible to make home owners out of most lebanese. With a 40 percent tax, for every 3 houses sold at least 1 house can be given to a lebanese family who can't afford one.