Mongolia is currently experiencing an economic boom and a rapidly developing tourism industry. With high levels of FDI, GDP growth averaging over 7% p/a for the last 5 years, minimal purchase costs, low taxes and positioned between two future global financial superpowers (Russia & China), both the economic future and the investment potential look set to explode.

With a population of just over 2.5m dispersed across 1.565.000sqkm, Mongolia is one of the least dense populations on earth. Home to a striking terrain of mountains, lakes, deserts and grasslands, the country also enjoys a vibrant capital city. Bordered by a picturesque mountain range, Ulaanbaatar prides itself on being a progressively modern capital and has a range of restaurants, bars and nightclubs.

The recent emergence of well-known hotels such as the Hilton and Shangri-La demonstrate Ulaanbaatar's prevalence as a developing tourist destination which welcomes 500,000 tourists each summer. According to the Mongolia National Statistical Office, tourism is expected to double between now and 2009.

Although there are currently no direct flights from Britain, Mongolia is still relatively accessible. Air Korea fly into Ulaanbataar via Seoul, and if you are lucky you may have a 7 hour stopover where you get the price of the airport hotel included in the ticket. Another option is to fly with MIAT but this is slightly less straightforward. It involves flying to Berlin, changing airports, flying to Moscow, and then on to Ulaanbaatar.

Mongolia now enjoys a parliamentary democracy and won the award for the Best New Democracy in 2006. It joined The World Trade Organisation in 1997 and is also a full member of the Multilateral Investment Guarantee Agency of the World Bank Group. 75% of the country remains unexplored and the rich mineral wealth is attracting principal copper, coal and gold mining companies such as BHP, Rio Tinto and Invanhoe. These companies are now based in Ulaanbataar, creating significant demand for high-end apartments. It is this demand that makes Mongolia's property market so interesting to foreign investors and has inspired Property Frontiers' decision to sell investment properties in the capital.

The market as it stands at the moment is divided into two. Half of Ulaanbataar's inhabitants live in traditional 'ger' settlements whilst the other half live in old buildings that are deteriorating fast. Many who live in gers aspire to move into fixed residences whilst those in poor quality permanent accommodation are now looking to upgrade to newer, more reliable abodes. Thanks to low unemployment, falling interest rates and low inflation, domestic wealth is increasing, meaning locals are directing increasing amounts of capital towards the property market. This has led to a supply-squeeze on medium grade accommodation, which, coupled with the demand for high-end professional apartments, has prompted a supply and demand imbalance which will be difficult to neutralise until at least 2015.

The property market in Ulaanbaatar, Mongolia is therefore becoming extremely lucrative. Rapidly appreciating land values and increasing salaries have pushed up rents meaning yields currently sit at around 20%. Property Frontiers have calculated that with yields at their current height, an investment in their largest apartment should be repaid in just five years. What is more, falling interest rates as the economy explodes mean real estate growth currently stands at 30%+ pa.

Property Frontiers last week announced the launch of a new development in the most desirable sector of Ulaanbaatar. Regency Residence occupies a prime city centre park-side location close to the picturesque Tuul River, the main strip and the principal Embassy buildings. Combining commercial and residential space, offering clean title, secure freehold ownership and developed by Mongolia Properties, Regency Residence provides exactly the right quality housing for the market.

Regency will be the only development in Mongolia to offer a dry cleaners, a health club, shops, a Montessori school and a restaurant all within one building. What is more, the developers are keen to incorporate a lobby-style entrance to the building, a unique concept in Mongolia. Luxury 1, 2 and 3 bed apartments and stylish penthouses all come with a choice of furniture packs and generous balconies. South-facing, Regency Residence enjoys stunning views of the Bogd Khan mountain range. Properties are available from just £33,000.

In short, Mongolia and its capital are bursting with excitement, energy and a strong economic future, and Regency Residence is ideally situated to reap the rewards. With a continuing influx of international business, increasing domestic wealth and a promising tourism market, rental rates are expected to increase far beyond the current level. Mongolia offers an astonishing opportunity which should appeal to savvy investors with an eye for the unusual.