A lower plot ratio in the central business district will restrict the scale of future luxury projects, pushing values higher Prices for luxury condominiums in Bangkok's CBD are expected to rise as the government plans to introduce new zoning regulations next year, according to international property consultants. The new rules will lower the plot ratio of developments in the business areas and are aimed at improving city planning. This could result in a decrease in new supply, forcing prices to go up, they said. 'In the centre of Bangkok the new regulation will lower [the] plot ratio in various areas,' said Aliwassa Pathnadabutr managing director of CB Richard Ellis (CBRE), Thailand. The new rules are expected to be enforced early next year. The luxury condominium market experienced a comeback in 2002 - five years after the Asian economic crisis. High-quality condominium projects in Bangkok's prime locations have recorded 20 per cent to 30 per cent capital gains over the past three years, with an average 6 per cent rental return. Property consultants said condominium supply saw sharp growth in the past few years as the market picked up. For example, 42 projects were launched in the inner city last year, up from 31 in 2003, according to a research report by Thai developer Raimon Land. But property consultants said the supply trend had slowed down. They said the market would be positive partly due to a growing demand from expatriates. In a recent survey, CBRE found that expatriates now form a bigger part of the residential condominium market in Bangkok and other areas in Thailand. Foreign buyers account for about 25 per cent of high-end condominium purchases - up from 10 per cent a few years ago. Under Thai law, foreigners can own up to 49 per cent of a condominium in Thailand, but they are not allowed to buy freehold land. 'With sustained yields and impressive historical capital gains, investment in grade-A condominiums in prime locations is a more popular investment choice for Thais and foreigners,' Ms Pathnadabutr said. She said property management was a crucial factor in capital appreciation in Bangkok's upmarket condominium market. Aside from property in Bangkok, consultants said expatriate buyers showed an interest in the traditional resort area of Phuket. They were also interested in the eastern part of the country including the tourist resort of Pattaya, and the industrial zones Chonburi and Rayong thanks to the improved infrastructure there. Thailand's long-awaited US$3.5 billion international Suvarnabhumi airport, due to open next year, is located 30km east of Bangkok Chonburi highway, connecting Pattaya with the capital. It will take less than an hour's drive to reach Pattaya and Bangkok. Once in full operation, the airport will replace the already overcrowded Bangkok International Airport. It will have two runways with a planned capacity of 76 flights per hour and 45 million passengers per year. Long-term plans for four runways with a theoretical capacity of up to 100 million are on the drawing board. Many expatriates work in Chonburi and Rayong where vehicle makers have their regional headquarters, property consultants say. At an international property expo in Hong Kong at the weekend, a third of the 85 booths showcased Thailand developers offering 'off the plan' mid-tier condominiums and completed luxurious pool villas in Bangkok, Phuket, Hua Hin, Pattaya, Koh Samui and Krabi. Prices ranged between US$150,000 and US$800,000.