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.

COMPANYRECENT PRICENUMBER OF SHARESANNUAL DIVIDENDANNUAL TOTAL PAYOUTFREQUENCYTOTAL INVESTMENTVITL.UN$5.341,310$0.36$471.60Monthly$6,995.40

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.

The post This TFSA Stock Pays a 6.7% Monthly Dividend and Is Worth a Look Right Away appeared first on The Motley Fool Canada.

Should you invest $1,000 in Vital Infrastructure Property Trust right now?

Before you buy stock in Vital Infrastructure Property Trust, consider this:

The Motley Fool Canada team has identified what they believe are the top 10 TSX stocks for 2026… and Vital Infrastructure Property Trust wasn’t one of them. The 10 stocks that made the cut could potentially produce monster returns in the coming years.

Consider MercadoLibre, which we first recommended on January 8, 2014 … if you invested $1,000 in the “eBay of Latin America” at the time of our recommendation, you’d have over $16,000!*

Now, it’s worth noting Stock Advisor Canada’s total average return is 91%* – a market-crushing outperformance compared to 87%* for the S&P/TSX Composite Index. Don’t miss out on our top 10 stocks, available when you join our mailing list!

Get the 10 stocks instantly #start_btn6 { background: #0e6d04 none repeat scroll 0 0; color: #fff; font-size: 1.2em; font-family: 'Montserrat', sans-serif; font-weight: 600; height: auto; line-height: 1.2em; margin: 30px 0; max-width: 350px; text-align: center; width: auto; box-shadow: 0 1px 0 rgba(0, 0, 0, 0.5), 0 1px 0 #fff inset, 0 0 2px rgba(0, 0, 0, 0.2); border-radius: 5px; } #start_btn6 a { color: #fff; display: block; padding: 20px; padding-right:1em; padding-left:1em; } #start_btn6 a:hover { background: #FFE300 none repeat scroll 0 0; color: #000; } @media (max-width: 480px) { div#start_btn6 { font-size:1.1em; max-width: 320px;} } margin_bottom_5 { margin-bottom:5px; } margin_top_10 { margin-top:10px; }

* Returns as of June 15th, 2026

More reading

• How $20,000 Across 4 TSX Stocks Could Deliver $1,000 in Passive Income
• 2 Safer High-Yield Dividend Stocks for Canadian Retirees
• A 6.8% Dividend Stock Paying $39.30 Every Month
• This TSX Dividend Stock Has Dropped 13% — and I’d Still Back It for the Long Haul
• How to Use a TFSA to Earn $500 a Month Completely Tax-Free

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool recommends Vital Infrastructure Property Trust. The Motley Fool has a disclosure policy.