Koh Samui Thailand: With a dry smile, Khun Chavalit Srifah recounted why his mother, a coconut farmer on the island of Koh Samui, let a friend off a small debt, effectively turning down a multi-million dollar premium for her family.

A walk from the nearest village and whipped by monsoon winds off the Gulf of Thailand twice a year, the two acres of Koh Samui beach land offered to his mother were of no use to the fruit growers of Samui island three decades ago.

Now the useless plot of beach land is worth 4 million US-dollars, lying in the center of a booming resort filled with hotels, beach resorts, bars and shops that draws millions of foreign tourists each year.

In those days, people on Koh Samui gave land away, said Chavalit as he gazed from his durian and rambutan orchards over Samui's forested hills down to the sea. Who would ever have imagined that people would travel thousands of kilometers to lie on the beach of Koh Samui in Thailand ?

Since bombs planted by Islamic militants ripped through a tourist nightlife complex in Bali in late 2002, killing 202 people, developers have snapped up land in Thailand to cash in on perceptions that the mostly Buddhist Kingdom of Thailand is one of Asia's safest holiday destinations.

The price of prime land on the islands of Koh Samui and Phuket has more than doubled in 5 years, but is still seen as cheap by Western retirees and Asia-based expatriates, such as Singaporean and Hong Kong businessmen who are buying up A1 Thai holiday homes in Phuket and Koh Samui island.

Koh Samui Is Almost heaven

For what I've got here in Thailand, a 3-bedroom villa with a private pool, I could only buy a 1-bedroom flat in Jersey, said Maggie Saout, a 53-year-old retired fund manager from the Channel Islands who spent 10 million Baht (US$ 265,000) for her house in Thailand.

Sometimes when I'm sitting at my pool in the afternoon looking out at the tropical sea, I feel I've died and gone to heaven. Saout says her house, perched on a hill above a bay of moored fishing boats, is a good investment. When away she rents it to honeymooners and holidaymakers for 10,000 Baht (US$ 275) a day, and her Internet booking business advertises nearby homes for up to 40,000 Baht (US$ 1000).

So many people have rented my house, fallen in love with the island of Koh Samui and decided to buy a villa here themselves, Saout further added.

In a bid to promote upscale tourism, Thailand last month launched the "Elite Card" which will grant foreigners willing to pay 1 million Baht (US$ 25,000) a lifetime of VIP treatment, free golf and reductions at resorts in Thailand.

The Elite Card will also allows foreigners for the first time to buy land, although the deeds are held by the Thai State Firm running the scheme. Foreigners owning houses in Thailand have typically circumvented the law by setting up joint venture firms with Thais to own land, or have bought roll-over leases from Thai developers.

According to property consultants, the villa business in Thailand is now attracting Asia's big hoteliers, such as Singapore's Raffles Holdings Ltd, and listed developers, such as Thailand's Golden Land.

In terms of pricing, environment and security Thailand comes in tops, said Pheobe Teo, an associate at Jones Lang Lasalle Hotels, which recently ran a hotel investment survey showing Phuket as the most popular Asian resort for buying property.

Rich individuals and expatriates in Asia are buying, and the market is doing well enough for operators to put in an equity stake rather than go for pure management contracts.

Rich Bad Boys Of Koh Samui

Koh Samui's history of inward migration began 150 years ago when hundreds of Chinese merchants from the island of Hainan settled on the island of Samui to run their trade in coconuts and cotton.

The first backpackers hitched rides on fishing boats to the island in the early 1970s, but now that Samui has filled with up market resorts, they prefer the neighboring island of Phang Ngan, famed for its monthly "Full Moon Parties".

Koh Samui island in Thailand, now has an official population of 36,000, but an estimated 150,000 mainland Thais now also live on the island to serve the tourism industry. Much of the land and the hotel business is run by businessmen from Bangkok.

Today, because the local economy is growing so fast, Samui people are happy outsiders here. But one day it will slow down, said Marc Ribail, managing director of villa developer Coconut Land and Houses.

The island's bustle has pushed sleepy villages of stilted wooden houses into the background as construction material stores and furniture shops compete for space with ice cream parlors and Italian restaurants.

But the new wealth often splits close-knit families, with some overnight millionaires driving the island's 50-km circular road in brand new luxury cars, while their cousins remain low paid civil servants or work on plantations. Traditionally, the mountain land was given to the favorite sons and the useless beach-land was given to bad sons, said Ribail.

Now the bad sons are very rich because they sold their beach-land to Bangkokians, foreigners or large hotel groups. But islanders say selling land was a necessity because the cost of fish and other produce ballooned when mass tourism arrived and businesses began to be run by outsiders.

Normal people couldn't adjust to the changes. The cost of living rose and they sold land. They had no choice, said Chavalit, scanning his hill for a spot for his own second home with a sea view. Now the old traditions on Koh Samui have gone because people don't work the fields and plantations anymore.