An Ideal TFSA Stock With a 6.6% Payout Each Month

A 6.6% monthly yield looks tempting, but the real story is whether the payout is getting safer.

Key Points
  • NorthWest Healthcare REIT pays $0.03 monthly from healthcare properties with long leases and high occupancy.
  • Its payout coverage improved, with AFFO payout ratio falling to 85% from 99% year over year.
  • The big risks are refinancing costs and tenant issues, so keep position size modest and monitor results.

A 6.6% payment every month sounds like a cheat code. It rarely is. Still, a monthly payer can make a Tax-Free Savings Account (TFSA) feel alive, as cash arrives like clockwork and you can reinvest it without tax friction. The ideal TFSA income stock keeps the payout covered by recurring cash flow, holds assets people truly need, and carries debt it can manage even when rates stay stubborn. You want predictability, not a roller coaster with a dividend sticker on it. So, let’s look at one to consider.

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Source: Getty Images

NWH

NorthWest Healthcare Properties REIT (TSX:NWH.UN) earns attention because it owns healthcare real estate, not discretionary retail. It holds clinics, medical office buildings, and hospitals across North America, Australasia, Brazil, and Europe. NorthWest reported 167 income-producing properties and about 15.7 million square feet of space in its portfolio update. That mix leans on long leases and essential services, which can support steadier rent cheques.

The market punished the name through the rate shock. Higher yields squeezed real estate investment trust (REIT) valuations and raised refinancing costs, and investors did not give global landlords much patience. NorthWest also sold non-core assets as part of its plan, so reported revenue declined even as the remaining properties continued to perform. In the third quarter (Q3) of 2025, revenue from investment properties totalled $104.3 million, down 2.6% year over year, mainly because dispositions reduced the portfolio size.

Even so, the units have steadied and even bounced. Over the last 52 weeks, shares have risen about 19% at writing, and that range shows how quickly sentiment can swing, suggesting investors have started to reward improving fundamentals. It does not erase the longer-term drawdown, but it hints that the free-fall has stopped.

Earnings support

Now for the part income investors actually care about: the cheque. NorthWest declared a distribution of $0.03 per unit for December 2025, payable January 15, 2026, which annualizes to $0.36 per unit. Right now, that brings the dividend yield to 6.6% as of writing. All while trading at just 27 times earnings.

Coverage has improved, which matters more than the headline yield. In Q3 2025, NorthWest produced adjusted funds from operations of $0.11 per unit and brought the adjusted funds from operations (FFO) payout ratio down to 85% from 99% a year earlier. Occupancy sat at 96.9% and weighted-average lease expiry measured 13.4 years, which supports visibility. Same property net operating income (NOI) rose 4.4% to $76.9 million, and the REIT completed about 200,000 square feet of leasing with a 90% renewal rate.

Valuation looks reasonable, but you should keep your eyes open. NorthWest trimmed costs, with Q3 general and administrative expenses (excluding certain items) at $12 million, down $600,000 from Q3 2024. Management highlighted internalizing Vital, exploring alternatives for the European portfolio, and running buybacks under its normal course issuer bid. Healthscope remains the tenant headline to watch, but NorthWest said it ended the rent deferral and received repayment of deferred rent as the receiver-led sale process moved toward late-November bids.

Bottom line

So, is NorthWest the perfect TFSA monthly payer? It can be, if you buy it for what it offers today: a $0.03 monthly distribution, improving coverage, long leases, and healthcare demand that does not go out of style. It also brings real risks, including refinancing pressure, valuation swings, and tenant surprises. Even so, here’s what $7,000 could bring in today through dividends alone.

COMPANYRECENT PRICENUMBER OF SHARESDIVIDENDANNUAL TOTAL PAYOUTFREQUENCYTOTAL INVESTMENT
NWH.UN$5.491,275$0.36$459.00Monthly$6,999.75

Treat it as a higher-yield holding that you size carefully and review each quarter, and the monthly cash can feel like clockwork inside a TFSA. If that feels too spicy, choose a lower-yield alternative and sleep well.

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool recommends NorthWest Healthcare Properties Real Estate Investment Trust. The Motley Fool has a disclosure policy.

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