FAQs

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1 Who are Colour Investments?

2 What do you do?

3 How long have you been established? What is the history of Colour Investments?

4 What are the benefits of registering with Colour Investments?

5 How do I find out about the opportunities you are offering?

6 What types of properties do you source?

7 How do I buy property through you?

8 How does Colour Investments earn its fees?

9 Why do I have to pay a mortgage arrangement/finance fee?

10 How are you different to other investment clubs/ associations?

11 Do I buy the properties in my own name?

12 What if I don't have any money to invest?

13 How do I re-mortgage?

14 I only want to buy near to my home so that I can manage the property. Is this wise?

15 Why do developers offer properties at a discount - won't they be losing money?

16 How do I know that the discount and rental incomes are real?

17 Why in some cases do I not have to pay a deposit on the property purchased?

18 What happens to my deposit when I exchange contracts on an off-plan purchase?

19 What about changes in property prices? What if my property value goes down?

20 What if interest rates go up?

21 Is there growth in the buy-to-let market?

22 Is now a good time to invest?

23 Why don't more people do this?

24 Won't there be difficulties trying to rent properties in new developments all at once?

25 What if I want to buy more than one property? Can I get more discounts?

26 Will I be able to sell my off plan property prior to completion?

27 How will I realise my capital gain if I sell prior to completion?

28 Is it easy to sell my property and can Colour Investments assist in this?

29 What happens to fees/deposits if I pay them and decide not to go ahead?

30 What is the rental yield on a property?

31 Who are the tenants who will rent these properties?

32 Should I let my property furnished or unfurnished?

33 What timeframe should I be looking to invest for?

34 Can I use my own solicitor and/or mortgage broker?

35 Will I have to pay tax on any profits?

36 Can I manage my own properties?

37 Can I invest in property under a company name?

38 Why should I use Colour Investments rather than using an estate agent?

39 How do I make money in property? Is it through rental income or capital gain?

decease best viagra if possible, patient or mortgaged?">40 Should an investment property be purchased outright, cialis sale if possible, or mortgaged?

41 How long does it take on average to let a suitable property?

42 What is the average tenancy period?

43 Who pays Council Tax, service charge and ground rent on these properties?

44 How much can I borrow?

45 Can I have more than one buy to Let mortgage?

46 Can 'non-residents' get buy to let mortgages?

47 What is the level of interest charged on a buy to let mortgage?

48 Interest only or Capital and Interest?

49 Does my personal status matter?

1. Who are Colour Investments?
Colour Investments is a UK based independent buyers agent and property sourcing company specialising in helping investors acquire both UK and Egyptian property for investment purposes.

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2. What do you do?
We source property investments that are in excellent growth potential areas and generally negotiate substantial discounts off these properties. We also provide assistance with choosing the right finance for your investments or any other area of property investment such as furnishing or renting your new investment.

We act as a one stop shop providing a comprehensive service encompassing sourcing, research, negotiation, consultation, financial advice, mortgage services and engaging solicitors. We provide consultation to take you through the process from purchase to completion whether you want to sell-on or let your property on completion.

Our aim is to provide our investors with a low risk, no hassle way of purchasing investment property.

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3. How long have you been established? What is the history of Colour Investments?
Our limited company name is Black Sigma Ltd and we trade as Colour Investments. We were established around mid 2007 by the 2 founding directors. Together Colour Investments's two directors have worked in the financial services industry and property industry for many years as professionals and investors. Between them they currently hold a property portfolio of over 2 million pounds (and growing!) and have many years experience in buying and managing property. Colour Investments is currently based in Canary Wharf, London.

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4. What are the benefits of registering with Colour Investments?
Registering with Colour Investments will give you the following benefits;
- Free access to e-mail alerts on the latest discounted investment property opportunities both in the UK & Egypt.
- Subscription to our newsletter which is packed with tips, news and views on investing in property.
- Free financial property consultation.


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5. How do I find out about the opportunities you are offering?
Investors need to register with us to go on our investor database. Once you are on our database we will then e-mail you details of all the property opportunities that we have on offer. These e-mails will have a link to the properties available section of our website where you can download all the details. You can also just visit the properties available section of the website to view the properties that we currently have available.

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6. What types of properties do you source?
We focus on Egypt and UK buy to let properties. Typical properties that we offer are 1 & 2 bedroom apartments in city centres or outer-lying regional areas. These types of properties are often the most suitable for rental purposes because they are new, are low maintenance and offer the best investment potential. The typical tenant would be a young professional who is not yet on the housing ladder. A lot of the developments that we source are off plan (i.e not yet built) as we can obtain discounts by buying early in the development cycle. Sometimes some of the properties will already be built as financing and valuing this properties is much easier.

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7. How do I buy property through you?
The process of buying property from Colour Investments is a relatively simple one. It is best explained in a step by step fashion;
- We email you all the outline details of each property opportunity once an agreement has been reached with a developer, we have done our due diligence and put together an investment package. These e-mails will have a link to the properties available section of our website where you can download all the details of the properties.
- Prospective purchasers will normally speak with one of our Investment Consultants at this point to check the availability of a particular plot if they wish to proceed and pay the reservation fee and Colour Investments fees (vary per development) by bank transfer or cheque . We also require you to fax back a signed copy of our terms & conditions to confirm payment and to confirm the details of your plot.
- If you are dealing with Colour Investments for the first time, we will put you in touch with our mortgage broker partners (for UK sales) who will then be able to give you a decision in principle on your mortgage, should you require one. Please note that it is not a condition of purchasing a property through us that you use our nominated mortgage brokers. You are free to use your own mortgage broker but we do recommend using ours as they are already familiar with our developments and will be able to get you the best finance package available.
- Next your solicitor, will guide you through the legal process. If you do not have a solicitor we can give you advice on who to use. The solicitors will require a payment from you to open a file on your behalf. The developer's solicitors will draw up the contracts to exchange/complete between yourselves and the developer. You will need to sign the contracts and any extra paperwork required by the developer and return these to the solicitor promptly.
- If the development is less than 6 months away from completion then you will need to obtain a mortgage offer from a lender prior to exchange. Our mortgage brokers will assist you in obtaining a mortgage offer. The fee for obtaining a successful mortgage offer varies but is usually between 1-1.5% of the loan amount and this is payable upon the offer being issued. If however the development is more than 6 months away from completion then you could exchange contracts with a decision in principle from our mortgage brokers and obtain a mortgage offer later.
- Upon or prior to completion our recommended letting/selling agents can sell/let the property for you.

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8. How does Colour Investments earn its fees?
For UK property we charge 2% of the Gross property price as a buyers agent fee to you our clients for sourcing the property and carrying out all the due diligence on that property for you. We have close relationships with the developers we work with and this allows us to negotiate deals that are not normally available to the average investor, we aim to bring these deals to you and make sure the deal stacks up to your investment criteria.


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9. Why do I have to pay a mortgage arrangement/finance fee?
As the mortgages are generally specialist buy-to-let mortgages which are not available through high street branches of the major banks the fees reflect the extra services being offered.

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10. How are you different to other property investment companies/agents/clubs/associations?

Firstly it's important to note that we are not an Estate Agency. We are quite the opposite in fact - we are "Buyers agents" or we're sometimes referred to as "sourcing agents". Basically we work for (and are retained by) our clients not any one developer and hence we work hard at being independant to give our clients the best possible impartial advice on what to buy in the UK or Egypt. We source very specific properties for our clients & to promote on our website, we don't offer all the other (not so good) developments that most other agents do. Our developments are "hand picked" as our choices of what we think is the best on offer in the UK & Egypt and we carry out extensive due diligence on each development that we offer. We are VERY confident in our product choices and you will see this passion from us when you speak to us.

We also differ from other property investment companies/clubs/associations in that we do not charge any membership fees to be involved with us. We do not require you to attend any "salesy" property seminars either. We position ourselves at the high end of the market in terms of our investment clients and we work hard to provide a clear and transparent way to invest in property. We have no gimmicks and no pushy sales people we simply let the developments we choose speak for themselves.

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11. Do I buy the properties in my own name?
In most cases we recommend that you purchase the properties in your own name. The high level of gearing required to purchase properties using our methods is usually only allowed by lenders who will require you to purchase the properties in your own name. It is possible to purchase properties in a company name and our mortgage partners will be able to advise you of how to do this and where it is possible.

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12. What if I don't have any money to invest?
Really you need to have a minimum level of funds to invest in property.
Do you own a house with any equity? By releasing the equity in your property by re-mortgaging you could use these funds to purchase additional properties. We even have some property opportunities where you do not require any funds to invest and you can earn cash back on completion of the property. However, there is still usually a minimum level of funds required to pay fees (i.e. mortgage e.t.c).

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13. How do I re-mortgage?
Our mortgage partners can help with re-financing / re-mortgaging any existing property you own to release equity at highly competitive rates.

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14. I only want to buy near to my home so that I can manage the property. Is this wise?
We encourage clients to broaden their outlook in terms of the locations they buy investment property, especially to achieve higher capital growth. A diverse portfolio of properties also lessens the risk. Property prices can rise in some areas while not in others. We also select established letting agents with local knowledge and a proven track record in property management. We negotiate discounts off their normal fees so all you need to do is sit back and collect the rents. Therefore managing the properties even when you live far away may not be as difficult as you think.

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15. Why do developers offer properties at a discount?
The main way we secure discounts on the properties we offer is to sell in bulk. We commit to sell a number of properties for the developer and as such are able to negotiate a discount on the properties for our clients.

Developers are also much more likely to offer discounts as they are in business to build and sell property. Unlike an owner occupier who may be emotionally attached to selling his property for the highest possible price and who may be in a chain situation, developers need to sell property to stay in business. For example developers will often offer discounts for off-plan sales to generate capital to fund a future development. For lenders to lend to a developer on a project the developer may have to sell a number of units off-plan to secure the funding. The best way to get some off plan sales is through offering discounts. They may also want to cover the costs of marketing up-front. The developer will often discount the first few properties at this stage simply to 'prime the pump'. It is often easier, quicker and safer for developers to sell property before completion. They also don't have to deal with estate agents who are notoriously slow at selling property, or set up expensive sales and marketing offices which rely on clients coming to them. This way, they have a ready market. Sometimes developers who are nearing completion on a site and want to get rid of the last remaining units will offer various incentives such as discounts to sell them quickly. When the majority of the units have been sold, the developer has realised most of their profit from the development, and they want to wind-up the marketing and get onto the next site. When a developer is approaching their financial year end and they need to increase their sales figures they may also sometimes offer discounts. There is no set year end for developers so the time that they may offer discounts will vary from company to company. For limited companies this information should be available through Companies House, whilst most publicly quoted companies will send you a copy of their accounts on request.

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16. How do I know that the discount and rental incomes are real?
We usually supply detailed research on prices and rents on comparable properties with every property we offer. We will often where possible get an independent RICS surveyor (in the UK) to carry out a valuation on the price and rental of properties before we market them to ensure that we will not have problems with funding down the line. These valuations can be used for lending purposes.

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17. Why in some cases do I not have to pay a deposit on the property purchased?
Some banks will lend against the valuation of the property, not the purchase price. For example if a property is valued at £100,000 the maximum the banks will lend against the value of the property is 85% of valuation i.e £85,000. If we have achieved a discount of at least 15% or £15,000 then the investor may in some cases (subject to lending criteria) use this discount to form his deposit i.e the property is sold at £100,000 made up of a mortgage at 85,000 and a gifted deposit/discount of £15,000. This means that the property has been entirely funded by a mortgage while the investor has not put in any of his own funds. This method means that you can build your portfolio with much less capital than conventional means. It should be noted that the investor will still have to have funds available to cover any fees which we will set out for each development we offer so that it is easy to see what the total investment required will be. Of course sturcturing any type of investment deal is entirely dependant on your mortgage lenders criteria and whether they allow developer incentives of this kind.

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18. What happens to my deposit when I exchange contracts on an off-plan purchase?
Your deposit is held in a client account by the solicitor acting for you, until exchange of contracts. At this point your deposit is paid over to the developer's solicitor to be held as stakeholder until legal completion.

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19. What about changes in property prices? What happens if the value of my property goes down?
Until an asset is sold any increase or decrease in value is "paper" or unrealised. So as long as you still pay the mortgage on the property you won't realise any loss if the value of the property has gone down.

As the majority of the properties we purchase are discounted by at least 15%, this means that prices would have to decrease by at least 15% before starting to have a significant impact.

Property prices are governed by supply & demand for each particular type of property in its own area. There is an under supply of housing in the UK despite the credit crunch slwoing things down so we expect the UK property market to pick back up in the long term. The recently published Barker report commissioned by the Treasury, indicates that we need to be building 300,000 new dwellings each year for the next 10 years in an effort to reduce the huge gap between demand and supply and therefore curb house price inflation. The Royal Institution of Chartered Surveyors, along with others suggests 250,000 new properties should be built each year simply to stand still. At the moment because of backlogs in planning, problems gaining finance during the credit crunch and the time taken to get projects approved the house-building industry is only building approximately 180,000 dwellings each year. This under supply will push up prices again in the not too distant future.

Most investments in property have to be undertaken with a medium to long term view. Whilst prices can fluctuate from year to year, historically, over the medium term, any value that has been lost in a fall has been regained in subsequent years. It is often said that unlike the stock market, where the entire value of a stock can be wiped out, property is a 'forgiving' investment if you take the sensible long term view.

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20. What if interest rates go up?
We recommend that people do not overextend themselves and keep back reserves to cover any unforeseen costs such as increases in interest rates. However increases in rates tend to push more people into the rental market anyway which then puts up rental values.
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21. Is there growth in the buy-to-let market?
Yes. The long term statistics show that the average age of the first time buyer in 1988 was 21 years but in 2003 it is 32 years. Most young people these days cannot afford to buy property and are being forced to rent.

We are becoming a society of single occupier households, due to numerous reasons varying from increased life expectancy to economic migration and divorce.

The rental market only makes up roughly 5-6% of the overall housing market and stories of 'saturation' are generally far from the truth.

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22. Is now a good time to invest?
There is an old proverb that says "the best time to invest was twenty years ago. The second best time is now". At whatever time you invest along the time cycle, residential property investment is still considered to provide an attractive return when compared with other asset classes. The key to a successful investment strategy is not to overpay for the property in the first place and to optimise the relationship between borrowing, rental yield and capital growth.

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23. Why don't more people do this?
The buy to let market is relatively young and many people are simply not aware of this fairly new investment vehicle. Off plan property and buying at discount is even newer and is an excellent way to make money and mitigate risk. The market is growing as more and more people become educated and are discovering that property is arguably the best investment vehicle in the long run.

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24. Won't there be difficulties trying to rent properties in new developments all at once?
Developments are normally phased so all the properties will not come on the market for rental at once. Also using one rental agent for all the properties can avoid the situation of everybody undercutting each other to try and rent their properties. Also a number of our investment property developments have guaranteed rental schemes so you don't need to worry about renting your property at all in the early stages of the investment.

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25. What if I want to buy more than one property? Can I get more discounts?
Yes. We generally offer a reduction in our fees for the 2nd or subsequent properties bought. We also offer a healthy referral fee if you introduce another client to us once you've bought.

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26. Will I be able to sell my off plan property prior to completion?
This varies for each development, please check at time of purchase as a number of our developments come with "assignable contracts" which means you can flip (or sell) your contract prior to completion.

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27. How will I realise my capital gain if I sell prior to completion?
If you sell prior to completion, you will normally receive your deposit from the new purchaser, and any capital gain that you may have achieved will be passed on to you on completion.

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28. Is it easy to sell my property and can Colour Investments assist in this?
Colour Investments can act as a broker between clients, or alternatively can advise you of Estate Agents who can assist on the sale of a property to a third party if necessary.

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29. What happens to fees/deposits if I pay them and decide not to go ahead?
Reservation fees are not refundable once received and the cooling off period is over, you should make sure you are happy with your decision before purchasing any property.

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30. What is the rental yield on a property?
This is the annual rent divided by the purchase price of the property. It is in basic terms the rate of return on your investment. Like a bank savings account paying you 4% interest each year...
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31. Who are the tenants who will rent these properties?
Most developments we target are in or near city centres and aimed at an affluent market. We expect the majority of the tenants to be young professionals between the ages of 25 35 who want a city living lifestyle Young professionals especially want the 'action' that city centre locations can provide, but do not want the overhead of a mortgage...

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32. Should I let my property furnished or unfurnished?
Properties can be let unfurnished or furnished. If you let furnished you could expect a better rental figure than unfurnished. We can assist with furniture packages if necessary.

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33. What time frame should I be looking to invest for?
Generally, we would advise that property investment should be a medium to long term investment. However, sometimes we receive excellent property trading opportunities. Whether you choose to trade property, or hold on to it for longer term capital growth, is completely at your discretion - we will advise what we consider to be the optimal strategy.

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34. Can I use my own solicitor and/or mortgage broker?
We would normally advise that you use our specialist conveyancers and mortgage brokers who are experienced in arranging these types of transactions and have a proven track record. However if you have your own mortgage broker that you want to use that is fine also.

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35. Will I have to pay tax on any profits?
Unfortunately taxes will have to paid on any profits - there is no avoiding that! However, we can assist with providing property tax experts who can help you to minimise your tax liabilities.

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36. Can I manage my own properties?
Absolutely. You are not in any way obliged to use letting agents to manage your property. We would advise that the more properties you hold in your portfolio the harder it becomes so you may want to consider using a lettings and management agent to make life easier for you. Usually managing your own property can save you on the letting & management agents fees...

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37. Can I invest in property under a company name?
The answer to this is nearly always yes. However, since every individual circumstance is different, we would always advise you to consult with our mortgage brokers, solicitors and tax experts as to the benefits and limitations that this approach would bring.

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38. Why should I use Colour Investments rather than using an estate agent?
We have direct contact with developers to release the off plan opportunities well before an estate agent would get involved.

Also an estate agent has a duty to the vendor to achieve the highest price possible on a sale. We act for the investor as a buyers agent by achieving the best price and yield for our investors. Therefore the very basis of our investment approach is in complete contradiction with that of an estate agent.

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39. How do I make money in property? Is it through rental income or capital gain?
The big money is made in capital growth not rental income. As long as your investment finance is covered by the rent that it generates you will be well set to take advantage in the capital gains of that property investment. See our downloadable e-books covering the basics of investing or see our education pages for more information...

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40. Should an investment property be purchased outright, if possible, or mortgaged?
Your return on investment (R.O.I) will be greater using leverage or borrowing than if you purchase outright. Therefore we recommend using borrowed funds as much as possible to maximise your return on investment.

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41. How long does it take on average to let a suitable property?
This is dependent on the development and the number of units sold to investors.

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42. What is the average tenancy period?
For single tenancies 6 or 12 Months.

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43. Who pays Council Tax, service charge and ground rent on these properties?
The tenant is responsible for Council Tax on each property. The landlord must pay for the service charge and ground rent but there is no reason this can't be incorporated in the rent charged to the tenant.

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44. How much can I borrow?
Typically, a lender will allow you to borrow up to 85% of the value of the property on a buy to let mortgage but this can vary so talk to us and we will put you in touch with our specialist mortgage partners.

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45. Can I have more than one buy to Let mortgage?
Yes - you can take out multiple mortgages with different lenders - but in most cases, it is only possible to have one loan per property. This is because the loan is secured on the title of each property. You can borrow in individual names, jointly or in a company name.

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46. Can 'non-residents' get buy to let mortgages?
Yes - Non UK residents (e.g. foreign investors or non UK nationals posted to the UK) can purchase property using the buy to let loan scheme.

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47. What is the level of interest charged on a buy to let mortgage?
Interest rates tend to be up to 1% above the Bank of England base rate - although competition is reducing this differential.

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48. Interest only or Capital and Interest?
Typically a buy to let loan is taken out on an interest only basis.

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49. Does my personal status matter?
In theory a buy to let loan is 'secured' on the income and capital value of the property. Therefore the income and credit status of the landlord is not relevant. In practice, these are important points. Generally, any one can get a buy to let loan - but at a cost! The higher the risk, the higher the interest rate. In other words, to get the best possible finance, you should put forward the best possible case for the lender.

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