I would not want a granny flat in my house. My house, otherwise I could have continued living in an apartment building. Once we have landscaped the garden, hardly anyone can look in there anymore - a, MY terrace above the outdoor area of the granny flat... really not... would absolutely not be mine.
But about students as tenants: I also had a condominium in MUC and in retrospect I would ONLY rent to students. With one limitation: guarantee by the parents. But otherwise, I had the least trouble with my students. Money always flowed (mostly paid by dad or mom), additional payments as well, and after at most 3 years they moved out again. So you don’t have long-term tenants. Honestly, with the current tenant protection laws, that is a decisive advantage. An old couple who have been living in your apartment for 20 years or more you almost can’t get out anymore - no matter about personal use. In Munich there was just such a case, where an old man had lived in a three-room flat - forever. Wife passed away, he himself is now over 80. The owner registered (justified!!) personal use and even granted the senior a very generous notice period. But he went to court and won. He is allowed to stay. That is almost expropriation. Therefore, rental agreements that do not last longer than a degree are in any case better for the landlord.