The best rental level in the country is in Nottingham where average yields this year are 10.9%, up 1.13% from 2007, according to a poll of delegates attending next month's Property Investment Show in London.
Next is Durham with 9.23% based on a three bed house rented to three students. Close behind are Manchester, Hull and Bangor. The worst are Warwick and Crewe where average yields of 3.92% each.
But Nick Clark, managing director of the Property Investor Show said potential buy-to-let investors should not rush into making a decision and look at all the available information first.
'With house prices falling, now is a great time for cash rich investors to snap up a deal. However, investors should look at student accommodation as a long-term investment based on high rental returns rather than capital growth. If they are planning to sell within a year or two they will lose out,' he said.
'Investors may think that they are buying into a weak market, but as this research shows rental yields are on the increase and buy-to-let investors have a great opportunity to capitalise on the increasing demand for student accommodation, whilst taking advantage of lower house prices,' he added.
The average rental yield of 7.9% for the top ten university towns outstrips the UK average of 6.4% for other buy-to-let properties.
However potential buy-to-let landlords may find searching for an appropriate deal challenging. The latest research from MoneySupermarket has found that the number of available mortgages in the sector has fallen from 4,384 to just 307 in the past year.
