An aerial view of Khao Yai National Park in Nakhon Ratchasima province shows many areas occupied by residential projects. KARNJANA AYUWATANACHAI

The Khao Yai property market is expected to recover soon, as demand for resort homes remains strong and new transport routes appear in the next few years, say developers.

Thammarat Nirandara, chief executive of developer Privilege Estate Co, said a new motorway from Ayutthaya's Bang Pa-in district to Nakhon Ratchasima would drive the market, as the second exit would be on Thanarat Road.

"Khao Yai is a hillside resort location with cool weather and very close to Bangkok," he said. "It's only 200 kilometres to Khao Yai, where temperatures are usually five degrees lower than in Bangkok."

The Khao Yao property market has been sluggish since authorities started clamping down on illegal land encroachment in Khao Yai national reserve forests in Pak Chong district last year. 

The strict action has prompted many projects with unclear land title deeds to be frozen, with some developers stopping construction.

Nonetheless, Mr Thammarat said Privilege Estate still planned to launch in May the fifth phase of its condo development at Baan Tiew Khao. The 80 units worth 200 million baht are sized from 50 square metres and priced 70,000 baht per sq m after the fourth phase was 89% sold.

The developer aims to close sales at the new phase by year-end.

"After the government's crackdown on forest encroachment cases, only one or two projects were launched for sale each month. Most of them were not successful, as buyers were not confident," Mr Thammarat said.

He said demand for resort homes was less affected by the economic slowdown, given that 97% of buyers spent cash and only 3% used bank loans.

Half of the buyers were business owners living in Pak Chong and the rest were people in Bangkok and others looking for a resort home.

According to Plus Property Co, the Asean Economic Community will draw more visitors to make Khao Yai a property hotbed.

The area's population is still seeing consistent growth, while visitor numbers increase by at least 10-15% each year, said the research house.

Many visitors are in the high-income segment, which may well lead to constant demand for property and limited supplies.

As visitors increase, the Khao Yai area is likely to respond with new job opportunities and increasing prices for property purchases and leases. This area will soon become a rare property hotbed with ever-increasing demand, it said.

Spanning an area of 2,000 sq km, Khao Yai is a major tourism location only a three-hour drive from Bangkok.

It has a full range of transport and telecommunications infrastructure that can cope with its growing number of residents and visitors. It has also had significant investment in restaurants, hotels, resorts and golf courses.