Ecuador rental law leaves security deposits unregulated while capping monthly rent

Ecuador’s Ley de Inquilinato does not prescribe a legal limit or even a requirement for a security deposit when leasing a dwelling or commercial space. The practice of demanding a deposit of one or two months’ rent is customary, not illegal, and the amount is set by agreement between landlord and tenant. The deposit must be returned at lease end unless the landlord can justify deductions for damages or unpaid obligations.

The law does, however, set a ceiling on the monthly rent: it cannot exceed the duodécima part of 10 % of the property’s cadastral valuation, plus applicable municipal taxes. Tenants can request rent‑price fixing from municipal appraisal offices if a landlord charges above this limit. A reform bill under consideration in the National Assembly aims to regulate deposits and clarify the rights and duties of both parties, but the current rules remain in force.