This TFSA Stock Pays a 6.7% Monthly Dividend and Is Worth a Look Right Away

Monthly income still gets attention. That’s especially true inside a Tax-Free Savings Account (TFSA), where investors can collect cash without worrying about tax on eligible withdrawals. In a market where many Canadians still want yield but don’t want to chase risky double-digit payouts, this dividend stock offers an interesting middle ground.

VITL

Vital Infrastructure Property Trust (TSX:VITL.UN) pays a monthly distribution of $0.03 per unit, or $0.36 annually. Based on recent prices, that puts the yield around 6.7%. For TFSA investors looking for recurring cash flow, that kind of monthly dividend can look pretty appealing.

The trust owns healthcare real estate across several countries, including Canada, the United States, Brazil, Germany, and Australia. Its properties include hospitals, clinics, medical office buildings, and other healthcare infrastructure. That gives it a different feel from retail, office, or industrial real estate investment trusts (REITs). Healthcare demand doesn’t disappear when the economy slows, as people still need care, surgeries, specialists, diagnostics, and long-term treatment.

Investors still worry about interest rates, inflation, and debt costs across the REIT sector. Yet healthcare real estate can offer more defensive demand than many other property types. The trust also moved through a major reset after changing its name from Northwest Healthcare Properties REIT to Vital Infrastructure Property Trust. That rebrand came with a clearer focus on healthcare infrastructure and balance sheet improvement.

Into earnings

The latest results show why income investors may want to give it a closer look. In the first quarter of 2026, Vital REIT reported adjusted funds from operations (AFFO) of $0.10 per unit. That matched the same period last year. Its AFFO payout ratio came in at 87%, down from 92% a year earlier. That’s not ultra-low, but it looks far more comfortable than many stretched income stocks. The business also reported 3% same-property net operating income growth year over year.

Vital REIT’s portfolio also offers long leases and high occupancy. At the end of 2025, the trust reported 96.4% global occupancy and a weighted average lease expiry of 12.3 years. Long leases can help smooth out cash flow, which matters when a REIT pays investors every month.

Considerations

The catalyst from here comes from focus. Vital REIT continues to sell non-core assets, reduce leverage, and move capital toward markets and properties it wants to own for the long run. Its European portfolio sale should help free up capital for debt reduction and growth. That could support investor confidence if management keeps executing.

There’s also a demographic tailwind. Canada’s population continues to age, and healthcare systems need more physical infrastructure. Hospitals, outpatient clinics, and medical office space all play a role. Vital doesn’t need a flashy growth story. It needs steady occupancy, disciplined capital management, and enough cash flow to support the distribution.

Still, this isn’t a risk-free TFSA stock. REITs remain sensitive to interest rates. Higher borrowing costs can pressure earnings and property values. Vital REIT also carries debt, and investors should watch leverage closely. The trust’s past distribution cuts under its former name may also make some income investors cautious. That history doesn’t ruin the current thesis, but it deserves attention.

Bottom line

Even so, the stock looks worth a look this month for TFSA income investors. A roughly 6.7% monthly yield, healthcare-focused assets, and a more focused strategy create a decent setup. Investors should buy it only if they believe the trust can keep improving the balance sheet and supporting cash flow. Yet for now, even $7,000 can bring in strong income.

For a TFSA, that distinction matters. Monthly income feels great, but sustainable monthly income feels better. Vital REIT still has work to do, yet for investors who want tax-free cash flow from real estate tied to healthcare demand, this REIT deserves a spot on the watch list.