According to Colliers International, it's not just the lure of an exotic location. In the capital Bangkok, improving infrastructure is fuelling a condominium boom. Prices rose by 12 per cent in 2012, and are projected to increase another 10 per cent this year, the firm says.

Thai holiday resort towns are also experiencing an upswing. Colliers' data shows Pattaya to be the most popular location for residential investment outside of Bangkok, especially since local publicly listed and foreign developers began launching projects in 2011.

Surachet Kongcheep, senior manager of the research department for Colliers International Thailand, says that as most buyers in Pattaya are Thai, developers tend to target the mid- to low-end of the market (less than 3 million baht, or HK$790,370 per unit).

Another "hot" city is Phuket, where prices for inland properties are lower than the coast (again, less than 3 million baht on average), he says. Cha Am in Phetchaburi province, and Hua Hin and Pranburi in Prachuab Kirikhan province ran "rapidly hot" in 2011, but have levelled off now, Kongcheep says. Many were buyers from Bangkok seeking a weekend retreat. "In addition, some bordering provinces around Thailand also became popular in 2011 to 2012, as big-name developers launched projects in Chiang Mai, Udon Thani, Hat Yai and Khon Kaen, especially those provinces along the high-speed train development line."

According to Kongcheep, Chinese buyers are increasingly attracted to invest in Thailand due to growing investment yield (the highest being in Bangkok), and greater political and economic stability. The Thai economy is projected to grow by 5 per cent this year, as the nation returns to full manufacturing production.

Yuthachai Charnachitta, CEO of Italthai Group and president of its subsidiary, Amari Estates, whose newest project, Amari Residences Phuket, recently won the Best Architecture Multiple Residence award at the Asia Pacific Property Awards 2013, says Thailand is well positioned to attract foreign investment across key economic sectors.

"In the property sector, Thai properties remain well-priced and well below key regional markets like Hong Kong and Singapore, providing opportunities for significant capital gains as the market is currently in a rising cycle," he says. With luxury properties in Bangkok averaging US$452 per square foot, and a similar type and quality property in Hong Kong running at US$2,901 per square foot, "this makes Thailand's real estate market an attractive investment spot for regional investors", Charnachitta says.

"Compared to Hong Kong and Singapore, where governments have put in place cooling measures to slow down its property markets, such as increased stamp duties, Thailand certainly offers an ideal alternative as an investment destination," he adds. "Aside from the positive investment outlook, Thailand is also well positioned in terms of the complete package it offers - low cost of living, the fun factor and a vibrant lifestyle and culture."

For several reasons, according to Colliers, the number of foreign investors buying property in Thailand's resort areas has fallen considerably in recent years. CB Richard Ellis (CBRE) believes this may change as more reputable developers launch upscale projects. Aliwassa Pathnadabutr, managing director for CBRE Thailand, says that in the past, the market was dominated by smaller developers with limited financial backing.

Today, the increased dominance of reputable, large-scale developers will help raise the profile as a more credible real estate market.

"As developers such as Sansiri and Italthai increase their prominence in Phuket, the market is becoming more professionalised. This not only raises the benchmark in the quality of developments, but also gives investors more confidence," Pathnadabutr says. "CBRE believes the market is now ripe for another positive phase of development."

Properties to look for, according to Pathnadabutr, are those that offer professional or hotel management with rental income potential. "In a hotel managed property, not only will buyers benefit from hassle-free management and ease of ownership, they will also enjoy a maximised rental yield."

Rene Philippe Dubout, a Bangkok-based Swiss lawyer, has penned a book of advice for foreigners, , and an online "developer test" enabling them to assess a developer's reliability before purchasing a property off the plan.

While clarifying that "there are competent, honest developers in Thailand", Dubout's aim is to help unwary buyers avoid the pitfalls.

Dubout says many foreigners believe they can get around the law by buying land or houses either through a company with Thai shareholders that may be deemed nominees, or through renewable leasehold. His response: "Both set-ups are fraught with legal issues."

His final word of advice: "If you want to buy in Thailand, play it safe. Buy a condominium in freehold from a reputable developer."