Current rules give tenants stability while outlining repairs, deposits and eviction procedures for landlords.

Conflicts between landlords and tenants are among the most common housing disputes in Ecuador, often beginning with unpaid rent, damaged property, repairs that are not completed or misunderstandings over what was agreed to when a lease began.

Although many rental arrangements are handled informally, Ecuador’s Tenancy Law establishes a legal framework for both sides. The law sets out the responsibilities of property owners and renters, explains when a rental agreement is valid, and defines the limited circumstances under which a tenant can be required to leave a property.

The rules apply to homes and commercial premises, and they are especially important in a rental market where many agreements are still made verbally or with contracts that leave out key details.

At the same time, the National Assembly is considering reforms to update the law, which dates back decades and has seen few major changes. The proposed reform passed its first debate in April 2026 and was returned to the Justice Committee for additional review before a final vote.

Contracts can be written or verbal

One of the most important features of the current law is that a rental contract does not have to be written in order to be valid.

Verbal agreements are legally recognized, meaning that a landlord and tenant can create a rental relationship without signing a formal document. However, that does not mean verbal contracts are easy to enforce when a dispute arises.

If there is no written contract, the landlord may submit a sworn statement before a landlord-tenant judge to establish that a tenancy relationship exists. That can help prove that the renter occupied the property under an agreement, but it may not resolve all disagreements over rent, payment dates, repair obligations or other conditions.

For that reason, tenancy specialists recommend written contracts whenever possible. A complete lease should identify the landlord and tenant, describe the property, establish the monthly rent, explain how and when payments must be made, define causes for termination and include a process for resolving disputes, whether through mediation, arbitration or court action.

A written agreement also helps both sides avoid the most common problem in rental disputes: each party remembering the agreement differently.

Not every lease must go before a notary

Although written contracts are recommended, not all of them must be notarized.

Under current rules, a lease must be in writing and registered with a notary within 30 days only when the monthly rent exceeds one unified basic salary. For 2026, that amount is $482.

If the monthly rent is below that threshold, the law does not require notary registration, although the parties may still choose to formalize the agreement more carefully.

The requirement is important because many landlords assume every rental contract must be notarized, while some tenants believe an unregistered contract has no value. The law makes a distinction based on the rent amount.

A security deposit is common, but not required

Another frequent misunderstanding involves the security deposit, often referred to as a guarantee.

Ecuadorian law does not require a tenant to pay a deposit when signing a lease. It is not mandatory for the landlord to request one, and it is not mandatory for the tenant to provide one unless both sides agree to it.

In practice, however, deposits are common. Many landlords request the equivalent of one or two months’ rent to cover potential damage, unpaid obligations or other costs at the end of the lease.

Once a deposit is included in the contract, the agreement becomes legally binding. The contract should explain how much was paid, what it covers and under what conditions it must be returned.

At the end of the lease, the landlord must return the deposit according to the terms of the agreement unless there is proven damage attributable to the tenant. Any deduction should be supported by documentation, including evidence of the damage and the verified cost of repairs.

A landlord cannot simply keep the deposit without justification. At the same time, a tenant who damages the property cannot treat the deposit as automatic protection against responsibility.

Tenants have a minimum period of stability

The Tenancy Law also gives tenants the right to remain in the property for at least two years, unless there is a legal reason to end the agreement sooner.

A landlord cannot evict a tenant at will or simply because they want to rent the property to someone else. The law lists specific reasons that can justify ending the tenancy.

Those reasons include failure to pay rent for two months, damage to the property, unauthorized subleasing, using the property for a purpose different from the one agreed upon, demolition of the building or the owner’s proven need to occupy the property.

After the minimum two-year period has been completed, the owner may seek to recover the property but must notify the tenant at least 90 days in advance.

The notice requirement is intended to give tenants time to find another place to live or operate their business, while also allowing landlords a legal path to recover their property.

Both sides have repair obligations

The law divides repair responsibilities between landlords and tenants.

The landlord must deliver the property in suitable condition and keep it fit for its intended use. That means the owner is responsible for necessary repairs that allow the property to function properly as a home or commercial space.

If the landlord fails to carry out required repairs, the tenant can take legal action. With court authorization, the tenant may have the work completed and deduct the cost from the rent, plus a 10% surcharge.

The law also provides consequences when a landlord’s failure to maintain the property forces a tenant to leave. In such cases, the owner may face fines and could be required to pay compensation of up to three months’ rent.

Tenants, meanwhile, are responsible for damage they cause to the property or its installations. If a renter damages the property and does not make the necessary repairs, the landlord may complete the work and charge the tenant for the cost, also with a 10% surcharge.

In more serious cases, tenant-caused damage can be grounds for termination of the contract.

The law seeks balance in a difficult relationship

The Tenancy Law is designed to protect both parties, not only tenants or only landlords.

Property owners are entitled to receive rent on time, recover costs for damage caused by tenants and request termination when the tenant violates the agreement. Renters are entitled to occupy a property in adequate condition, receive proper notice and avoid arbitrary eviction.

The law recognizes that rental housing involves continuing obligations. A lease is not simply a payment in exchange for keys; it creates responsibilities that last throughout the rental period.

That is why many disputes arise when contracts are vague, informal or silent about basic issues such as maintenance, payment methods, use of the property or how the deposit will be returned.

Reform could change decades-old rules

The reform now being reviewed in the National Assembly seeks to modernize a law that was originally enacted in 1960 and later codified in 2000.

Supporters of the update say clearer rules are needed for today’s rental market, including better procedures for contracts, deposits, repairs, evictions and dispute resolution.

For now, the current law remains in force. Landlords and tenants continue to operate under rules that allow verbal contracts, do not make deposits mandatory, restrict evictions to specific causes and require both sides to meet their repair obligations.

The pending reform could change some of those procedures, but the basic problem it seeks to address is already familiar to many Ecuadorians: rental disputes often begin not because there is no law, but because neither side fully understands what the law already says.