We take a brief look at seven international property hot spots that are being tipped for great things this year...

Like it or loathe it, the international property investment market is heavily influenced by what the media is hyping up at any given moment.  Whilst the smart investor takes all this drama with a pinch of salt and uses careful research into longer term indicators to inform her investment choices (such as domestic property market and tourism trends), it nonetheless pays to keep abreast of what's being talked about.

Homes Worldwide and A Place in the Sun magazine have recently released their list of international hotspots for 2007.  Here, we pick out seven destinations that appear in both lists and consider what all the fuss is about...

1. South Africa

Over the last ten years, South African residential real estate has performed very well, growing by as much as 40% per year in key areas.  Stretching from St Helena Bay in the west to Durban in the east, the Western Cape is one of the most popular areas for Brits to buy property; prices on "the Garden Route" are now comparable to Spain.

In response to such spiralling prices, ANC Lands Minister Angela Thoko Didza recently proposed a ban on foreign ownership of freehold property.  According to Cape lawyer Michael Judin, however, this announcement created a perverse effect.  He told A Place in the Sun magazine, "Ironically, after an initial lull, the comments prompted a property-buying rush - many foreign buyers hoped to 'get in' before any action was taken.  Even though that now looks unlikely, the buying remains frantic."

South Africa's most popular markets are now relatively pricey and growth has decelerated.  However, yields remain healthy averaging 12-15% according to Homes Worldwide magazine, and with the country set to host the football World Cup in 2010, the government is improving transport infrastructure.

The domestic market is looking good too.  South Africa's economy is doing well and SA's expanding middle class are now spending heavily on property.  The country has strong property rights and of course world-beating, landscapes, wildlife, wine and climate.

2. Montenegro

Montenegro has been dubbed the "jewel of the Adriatic".  19th century romantic poet and wild child, Lord Byron was also a fan, writing, "At the birth of our planet, the most beautiful encounter between the land and the sea must have happened on the coast of Montenegro."

Although tiny (the country is half the size of Wales), Montenegro has a beautifully rugged landscape with the largest fjord in southern Europe (the bay of Kotor), the largest lake on the Balkan peninsular (Lake Skadar) and the largest canyon in the world after the Grand Canyon (Tara Canyon).  In the 1960s, the Montenegrin fishing village of Sveti Stefan was converted into a single hotel, attracting movie stars and royalty.  Forming part of the Dalmatian coast ruled by the Venetians in the 1400s, Montenegro has an impressive stock of beautiful buildings and UNESCO heritage site Kotor has been likened to a smaller version of Dubrovnik.

Having gained independence from Serbia last year, Montenegro is now looking to capitalise on its rich endowment of cultural and natural attractions, investing to boost tourist visitor numbers.  The main property markets are around the tourist hotspots of the Bay of Kotor and the Budva Riviera where property prices have risen by up to 50% in the last two years.

3. Dubai

Faced with depleting oil reserves, Dubai has reinvented itself over the last 20 years.  Now, the emirate is a major financial and business centre as well as boasting a rapidly expanding tourist industry.  Accompanying this impressive image change has been a building boom on a colossal scale.  Dubai is a now a land of superlatives with the biggest shopping mall, the tallest hotel, the richest horse race and the highest tennis match.  Never short on ambition, Dubai has not even accepted its natural limitations, constructing gigantic artificial island resorts, such as the Palm and the World, as well as the world's largest indoor ski slope...in the desert...now that really is climate change...

Despite much concern over impending oversupply in Dubai, one salient fact remains: the country has no capital gains or income tax, which is still pulling in foreign investors in their droves.  The UAE government also relaxed property laws last year allowing foreign investors to own freehold in Dubai.

4. The Caribbean

Given its proximity to the United States, beautiful beaches and idyllic islands, it's not hard to understand why the Caribbean is such a tourist hotspot.  The latest report of the World Travel and Tourism Council (WTTC) reported that whilst tourism currently accounts for around 15% of the region's GDP, this figure is set to increase to around 17% by 2014.

With property prices sky high in Florida, America's retiring baby boomers are now looking to the Caribbean in search of their dream holiday home.  And the poorer islands are taking advantage of the region's popularity with property investors and holiday makers alike to develop their own tourist economies.

Ambitious resorts are currently being constructed on islands such as Isla Margarita, St Lucia, St Vincent & the Grenadines, and Turks & Caicos.  Islands such as Turks & Caicos are also using tax incentives to draw in the foreign investor; its residents enjoy no income tax, no inheritance tax and no real estate tax.

5. Morocco

Morocco has long been popular with travellers in search of adventure and the exotic.  But despite its close proximity and economic ties to Europe, it has so far failed to establish a more lucrative mass tourist market.

Things are changing, however, and the Moroccan government has set itself the ambitious target of doubling current tourist numbers by 2010, attracting 10 million visitors a year at that time.  New resorts are being constructed along Morocco's 3,000 mile coast and 25 new low-cost air routes have been created to the UK, France and Spain.

Property prices, although rising quickly, are still typically significantly lower than their West European equivalents.  The tax regime is also very attractive: Income tax is zero for the first five years and inheritance tax is also zero if the property is left to children.

6. Turkey

With its Mediterranean location, sumptuous cuisine and rich blend of eastern and western culture, Turkey enjoys a thriving tourist market.  Turkish property is currently undervalued in relation to comparable Mediterranean holiday markets and easing access to finance has provoked a buying boom.

At the start of 2006, the Turkish government also clarified its position in relation to foreign ownership of Turkish property stating that foreign nationals could buy property for personal use up to 2.5 hectares in size.  After owning a property in Turkey for five years, there is no capital gains tax to pay.

The majority of Brits buy on Turkey's gorgeous coastline and property prices in popular coastal areas have risen by 30 per cent in the last years.  However, canny investors are also looking to the expanding city of Istanbul which is currently enjoying a strong economy and a building boom.

A key issue which will affect Turkey's property market is the progress of its bid to join the EU.  With the Turkish occupation of northern Cyprus proving an intractable stumbling block and hostile attitudes from key member states such as France, it seems unlikely that Turkey will join the EU in the next 10 years, however.

7. Bulgaria

And how could we forget Bulgaria...  Whilst this market is suffering from over-hype and over-supply in many areas, there have been good reasons to invest here to date.  Key reasons have been Bulgaria's accession to the EU at the start of this year in tandem with its cheap property prices.  Bulgaria's tourist industry has also grown rapidly, with the country taking advantage of its natural assets to promote both affordable skiing and beach holidays.

Now some investors are looking beyond the tourist markets to the city locations of Burgas and Sofia to seek out further capital gains.