A year after the Bank of Canada began cutting rates, the pivot story has stalled out. The BoC held at 2.25% for the third straight meeting this week — and this time, Governor Macklem wasn’t just saying “we’re watching.” He was explicit: Economic weakness and rising inflation from the oil shock creates a dilemma for the central bank, and a rate hike is now a possibility if energy prices persist. Bond markets are already pricing in a “slight probability” of an increase by October.
So the interest rate cuts that reset mortgage and refinancing expectations through 2025 may be the last ones we’ll see for a while. For investors who want to own businesses that benefit from where rates actually are — not where they might go next — these three Canadian stocks are worth considering.
Source: Getty Images
CSH
Chartwell Retirement Residences (TSX: CSH.UN) looks built for this moment because it sits at the intersection of demography and a healing cost environment. It runs seniors housing across Canada, and it earns money by filling suites and managing expenses tightly. When rates pivot lower, the market often re-rates real estate and income names first, but seniors housing adds an extra kicker because occupancy can drive growth even without a booming economy.
In the fourth quarter of 2025, Chartwell reported funds from operations of $81.2 million, or $0.26 per unit, up from $57.7 million, or $0.21 per unit, a year earlier. For the full year 2025 funds from operations (FFO) reached $278.0 million, or $0.95 per unit, up from $197.5 million, or $0.76 per unit, in 2024. Valuation looks odd if you stare at accounting earnings, so it’s better to think in price-to-FFO and payout durability with a 2.8% yield.
Chartwell’s occupancy growth is driven by Canada’s aging population, not by the interest rate cycle. If rates hold or even rise from here, Chartwell can keep growing because it does not need another cut to fill its housing for seniors.
FN
First National (TSX: FN) quietly benefits when rates stop feeling like a threat and start feeling like a tool. The Canadian stock is a mortgage lender and servicer that earns money through originations, placement fees, net interest income on securitized mortgages, and mortgage servicing income. In a lower-rate setting, refinance activity can wake up, housing sentiment can thaw, and investors tend to pay more attention to steady dividend payers again.
In the third quarter of 2025, FN reported net income of $57 million, up $21 million from a year earlier, helped by higher origination volumes and improved placement fees. It also reported third-quarter revenue rising to about $647.0 million from $560.4 million. The income hook remains strong, with the Canadian stock recently trading at 15.6 times earnings with a 5.2% yield.
The 2025 interest rate cuts already set up a multi-year pipeline of mortgage renewals from borrowers locked into higher pre-pivot rates, and that pipeline won’t evaporate just because the BoC holds things steady. The 5.2% yield gives you income while you wait for that origination tailwind to keep flowing.
KMP
Killam Apartment REIT (TSX: KMP.UN) rounds out the trio of stocks we’re looking at because it offers the cleanest “rates down, fundamentals up” combination. It owns and operates apartments, and it benefits from Canada’s chronic housing shortage and steady rental demand. When rates move lower, financing costs can ease over time, and investor appetite for reliable income often returns quickly. Over the past year, Killam’s story stayed refreshingly practical, focused on occupancy, rent growth, and developments coming online, while keeping its monthly distribution steady at $0.06 per unit.
In 2025, Killam generated FFO per unit of $1.23, up 4.2% from $1.18 in 2024, and AFFO per unit rose 5.1% to $1.04 from $0.99. In Q4 2025, it earned FFO per unit (diluted) of $0.30, up 3.4% year over year, while AFFO per unit held at $0.25, with same-property occupancy around 96.9%. Valuation has looked approachable, trading at 70 times earnings, while the more useful lens remains price-to-FFO and AFFO coverage. The AFFO payout ratio improved to 69% in 2025 and the yield currently sits at about 4.2%.
Killam is a play on Canada’s housing shortage. The rental deficit does not care whether the Bank of Canada cuts or holds. Even with rates stuck at 2.25%, people need somewhere to live.
Bottom line
One year after the rate pivot, the interest rate story has gotten more complicated. The BoC held again this week and an increase now looks like a real possibility. But the stocks that benefited from 2025’s cuts do not all depend on more cuts coming. Chartwell earns through occupancy, not rate cycles. First National benefits from the renewal pipeline already in motion. Killam earns through Canada’s housing shortage, which isn’t really an interest rate problem. Today, each offers steady monthly income even from just $7,000.
| COMPANY | RECENT PRICE | NUMBER OF SHARES YOU COULD BUY WITH $7,000 | ANNUAL DIVIDEND | TOTAL ANNUAL PAYOUT ON A $7,000 INVESTMENT | PAYOUT FREQUENCY |
|---|---|---|---|---|---|
| CSH.UN | $21.72 | 322 | $0.62 | $199.64 | Monthly |
| FN | $47.98 | 145 | $2.50 | $362.50 | Monthly |
| KMP.UN | $16.90 | 414 | $0.72 | $298.08 | Monthly |
If rates hold (or even rise) these are the businesses where the investment thesis does not collapse. That’s a harder standard than “rates need to keep falling,” and these three companies meet it. Which is often the best reason to look at them now.
