Student property yields "healthy returns"

Landlords offering buy-to-let properties on the student market can expect better yields than in the general market, according to new figures.

Paragon, a specialist lender in the buy-to-let market, has conducted a study which found that the average yields from a property let to students is over 25 per cent greater, than those with other tenants.

Data showed that portfolios without student properties generated a gross yield of 7 per cent, compared to 5.6 per cent from those without student portfolios.

"Strong tenant demand in the student market is driving yields in that sector," said Nigel Terrington, Paragon Group’s chief executive.

"If landlords select the right type of property in the right location, the returns from the student market can be extremely healthy," he continued.

According to the research, Middlesbrough, Chester, Huddersfield, Leicester, Hatfield, Ipswich and Canterbury are all experiencing strong growth in student tenant demand.