Website design By BotEap.comEcuador Real Estate laws should be part of the information you will research before moving to this country. It is important that you understand the specific laws that apply to Real Estate in Ecuador and that you will comply with once you live in a new country. Regardless of where you plan to retire or move to, you must be a law-abiding resident to avoid any unfortunate incidents with the local government.

Website design By BotEap.comForeigners often need to understand the rental laws in their host country because most of them like the flexibility that comes with this type of living arrangement. It is important to be aware of this so that you can avoid any adverse incidents with your future landlord or landlady or perhaps even a real estate purchase in Ecuador. You want to avoid violating any of the local laws, and at the same time, you want to know your rights as a tenant and as an owner of Real Estate in Ecuador.

Website design By BotEap.com4 clauses of the Ecuadorian lease law that you should be aware of and how it affects real estate in Ecuador

Website design By BotEap.comYou should be happy to know as a tenant that Ecuador’s real estate laws on rental housing are tenant friendly.

Website design By BotEap.comTo give you a brief understanding of your rental rights in Ecuador, here are the 4 important details you need to know.

Website design By BotEap.comIn the lease period.

Website design By BotEap.comMost rental contracts, according to Ecuador Real Estate laws, are valid for one year. However, the tenant has the right to request a two-year contract. During this time, the landlord or landlady cannot increase the rent. So if you know you can stay in a house for at least 2 years, you may want to apply to the landlord for a two-year contract. If they agree, but they still raised his rent in his second year, then he can file a complaint with the rent court (Tenancy Judge). If the court rules against the owner, he will be fined for violating the Real Estate law in Ecuador.

Website design By BotEap.comAbout the termination of the contract.

Website design By BotEap.comIn case of early termination, notice is expected from the party that initiated the termination of the Real Estate contract. If initiated by the landlord or owner, the tenant must be given at least 3 months’ notice so that the tenant has enough time to find another house to move into. If the tenant or landlord started it, he must give the landlord at least one month’s notice before the date he will move out. There may be some owners who force tenants to pay the remaining months in the contract but the latter is not obliged to comply.

Website design By BotEap.comAbout the rental price.

Website design By BotEap.comEcuador’s laws on the rental of housing and Real Estate in Ecuador, the landlord or lessor can only collect rent based on the value and current condition of the home. The law cites a formula that determines the percentage of rent. That means if you’re renting a big house and in an affluent neighborhood, expect to pay more for rent compared to houses in more modest communities. In the event that the landlord wants to increase her rate beyond what is allowed, she must file a petition in a rental court. You should also be aware that current law does not allow landlords to make automatic annual rent increases.

Website design By BotEap.comOn the legality of the rental contract.

Website design By BotEap.comIt is also specified in the law that the rental contract is only valid if it is duly notarized. If the lease you signed is not, then the landlord or owner cannot take legal action against you. But if they have a copy of a notarized rental agreement, that can be presented as a valid document in court.

Website design By BotEap.comImportant modifications to the leasing law in 2012 for Real Estate in Ecuador

Website design By BotEap.comThere have been amendments to this law and you may want to keep abreast of all of them. In 2012, the President of Ecuador vetoed the Reforms to the Tenancy Law and sent them to the National Assembly for a second debate. In February 2013, the approved text of the reformed law (Modifying Law of the Codified Leasing Law) was sent to the President for his approval, veto or disapproval.

Website design By BotEap.comThe main modifications are the following:

• Website design By BotEap.comMunicipalities are required to have a Real Estate Leasing Registry Office in Ecuador that has tenants and that helps keep records of lease contracts. The landlord must obtain a registration within 30 days from the date of the rental agreement. They must provide proof of a security deposit and rental certificate. Non-compliance by the lessor and late registrations will be fined up to 10% of the rental price. This office is also responsible for determining the highest rental price for a property and looking after the tenant’s deposit.
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• Website design By BotEap.comThe rental price of any property must not be greater than 1/12 of 10% of its commercial value. The landlord or landlady will be fined for any violation of this clause. They are also not allowed to require the lessee to pay any expense that implies horizontal property regimes (or areas co-owned and used by other people). They are also not allowed to shut off the tenant’s utility services even if the rent has not been paid.
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• Website design By BotEap.comSecurity deposits are allowed, but must not exceed the value of two monthly rents. This amount must not be withheld by the landlord or the owner, but must be deposited in the Rental Registry Office.
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• Website design By BotEap.comThe landlord or owner can terminate a rental agreement if the tenant fails to make two full monthly rent payments. This is true even if the payment is simply incomplete. Non-payment of utilities for more than three months is also a valid reason for termination of the rental agreement.
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• Website design By BotEap.comIn case of litigation, the reform indicates that it can be done before a location judge through a verbal procedure.

Website design By BotEap.comEcuador Real Estate laws change over time, so you should be aware of what is going on around you should you start living in this country.