The registration fee was reduced from 2 per cent to 0.01 per cent. The ownership transfer fee (split equally by the developer and home buyer according to the value of the purchase) was reduced from 2 per cent to 0.01 per cent and the special business tax, paid by developers, was reduced from 3.3 per cent to 0.1 per cent for 12 months. UBS Investment Research division in Bangkok expects housing demand to rise as a result.

'Various factors that support a strong recovery in housing demand have turned positive,' UBS says in a statement. 'In addition to the announced tax incentives, the interest rate has been cut 75 basis points over the past year and consumer confidence has recovered from the trough in October 2007.'

Savills (Thailand) managing director, agency and investment, Robert Collins believes there has been a degree of pent-up demand as some buyers have adopted a wait-and-see attitude since late 2006, and for the most part these purchasers are now comfortable to proceed.

'Overall, the Bangkok residential sector is subdued except at the very top end of the downtown luxury condominium market, which continues to achieve record sales values,' Mr Collins says. 'This trend is expected to continue as recent new project launches have proved very successful both domestically and for foreign buyers.

'This year is expected to be a strong performer as Bangkok values for freehold condominiums are seen as attractive when compared with other regional business centres. The attraction of Bangkok's capital growth opportunities and lifestyle continue to be a strong inducement for real estate investment.'

Leading the way at the high end of the Bangkok market is the newly launched Sukhothai Residences - adjacent to the city's revered Sukhothai Hotel - which is breaking new levels for condominium prices.

The project is being managed by Hong Kong-based HKR Asia-Pacific, part of the group behind Discovery Bay, and when finished by the fourth quarter of 2011, it will have 196 condominiums, including nine penthouses. There will be 18 different unit types with sizes ranging from 100 to 1,200 square metres.

HKR Asia-Pacific sales and marketing director Vivian Sze says about 45 per cent of the units have sold at prices ranging from 195,000 baht (HK$47,822) to 260,000 baht per sqmetre in the initial launch phase.

The largest penthouse was recently sold for an astonishing 408.7 million baht - equivalent to 343,798 baht per sqmetre - breaking all previous purchase prices for condominiums in Bangkok.

According to Raimon Land Research, the average price for gradeA condominiums in Bangkok is 88,707 baht per sqmetre, while the top-10 developments in terms of prices achieved is 145,000 baht per sqmetre.

Ms Sze adds the strong brand of The Sukhothai Hotel, and the condo-cum-hotel lifestyle of The Sukhothai Residences, have easily made itself stand out from the crowd in the Bangkok condo market.

'The Sukhothai hotel is already an internationally well-known hotel brand among tycoons and discerning travellers all over the world. We have actually attracted a lot of [international] buyers,' she says.

'For those who purchased during our launch, most of them are from Hong Kong, United States, Britain, Australia, France, Singapore, Japan and Malaysia.

'From an investment point of view, the high-end property prices in Bangkok are still far below the same of other major cities in the region. This will provide much room for appreciation potential of their properties.'