According to Paragon, landlords who rent properties to students are making greater returns than those who focus on other tenants.



Its research showed that landlords who had rented more than half of their properties to students were making rental returns averaging 8.6%, compared with yields of 5.6% for people who did not have any student properties. Investors who had some student properties generally made average returns of around 7%.



Paragon said that, based on the average value of a buy-to-let property of £178,566, those who rented to students collected rent worth around £15,356 per property each year compared with rent of £9,999 for non-student lets. Rental income tends to be higher for student lets as landlords typically let to students on a per room rather than a per property basis.



Neil Terrington, chief executive of Paragon Group, said: “Strong tenant demand in the student market is driving yields in that sector. If landlords select the right type of property in the right location, the returns from the student market can be extremely healthy.”