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Earning lifelong passive income with dividend shares requires investing in a certain type of business. There are plenty of dividend-paying companies on the London Stock Exchange to choose from. But whether most of these will still be rewarding shareholders 50 or even 60 years from now remains questionable.
Obviously, there are never any guarantees when it comes to the stock market. But in my experience, the most reliable dividends typically come from the businesses with a product or service that remains critical, regardless of the economic cycle or technological disruption.
And one stock to consider that might fit this bill in 2026 is Primary Health Properties (LSE:PHP).
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Reliable recurring dividends?
With a yield of 6.95%, anyone who puts £1,750 to work with this healthcare real estate enterprise can unlock close to a £120 annual passive income overnight.
With demand for healthcare largely unaffected by economic storms or geopolitical conflicts, occupancy for healthcare-related properties has historically been quite resilient. But looking ahead, an ageing population combined with supportive government policy are both generating powerful tailwinds to drive long-term rental income across Primary Health Properties’ portfolio.
While the group’s recent growth hasn’t been spectacular, it has largely kept up with inflation. And subsequently, so have dividends with 29 consecutive years of payout hikes. Combine that with the fact that net rental income covers the group’s dividend obligation by more than 1.6 times, and this source of passive income indeed continues to look rock solid.
A no-brainer buy?
Despite its long track record of resilience, Primary Health Properties isn’t a risk-free investment. Owning and operating a large-scale real estate portfolio incurs a lot of upfront costs. As such, the balance sheet carries a good chunk of debt with a loan-to-value ratio of 48.6% as of June 2025.
While this degree of leverage remains manageable, it makes the business highly sensitive to fluctuations in interest rates. And this sensitivity is only amplified by the impact rates have on real estate values as well.
Suppose the company is forced to sell some of its properties to raise capital? In that case, not only could it risk being forced to sell at a bad time in the market cycle, but it could also be forced to offer a further discount, given the niche use-cases of healthcare-focused real estate. After all, there are far more buyers of residential houses than there are hospitals and health clinics.
It’s also important to highlight that 88% of the group’s current rent roll comes from the government, primarily through the NHS. While that limits the risk of late rental payments, it also leads to non-lease renewals if budget cuts materialise.
The bottom line
For defensive investors seeking an inflation-protected source of passive income, Primary Health Properties could be an interesting prospect worth investigating further, especially given its generous and seemingly affordable yield.
However, for investors who are more interested in long-term growth, it may not be the most suitable. That’s why I’m looking at other income opportunities in 2026.
