February 02, 2015

What You Need to Know about Rental Increases & Renting to Large Families in Cuenca Ecuador

Do you remember our interviews about retirement with expat Alice who moved from Ohio two years ago and is now living in Cuenca Ecuador?  If you haven’t yet seen our interviews with Alice, please take a look at them here and then come back to this article.
 

Alice informed us recently that her landlady wants to raise her rent. Not just $25 dollar increase, that would be (almost) normal after two years, but she wants to raise the rent a whopping $150 dollars! This is absolutely outrageous. Of course Alice contacted us right away to let us know this absurd figure.
 

We told her she is under no obligation to pay it, and especially since her landlord had not done any repairs at all to keep up the house.  Remember the landlords will push the foreigners to see how far they will bend.  Always be ready to move out when such absurd demands are made.
 

We just met up with Alice today and she did get a rent increase but not $150 dollars like she initially thought; it is $50. But we think that is still too much. An appropriate rental increase would be $15 to $25 dollars at the most!
 

What do you think, does this make the Ecuadorian landlords seem greedy?  We still think $50 dollars is too much of a rental raise in just two short years, especially if your rent start is $350. Alice is concerned that when her contract is up in just another few months her landlady will raise the rent even more.
 

Just like Alice, you too might be next in line for a rental increase and when that happens, what are you going to do? There are a few things renters should know before they agree to a rental increase.
 

Ecuador rental law states your rent cannot be increased until after you have lived in the dwelling for two years.  Or, if you stated in the contract, which every gringo should do, no increases until after 4 years, or whatever you decide to stipulate in the rental agreement.

Rental agents will push for absurd contracts with cost of living increases, but there is no such thing in Ecuador.  Many foreigners are already paying top end high-end rents, and therefore no rent increases at all should be in the cards.  When you’re already paying the top of the market, why should the rent be increased at all?  Because you’re a gringo?  Don’t get taken advantage of.  Always be ready to move on.
 

We posted all of the rental laws and illegal maneuvers to beware of in the newest (seventh edition 2015) update of the DIY Cuenca Landing Guide so newcomers to Cuenca will know what is considered ethical and lawful and what is plain out illegal according to Ecuador law.
 

In another instance an expat told us that her landlord wanted to raise the rent $50 and she told him she would have to move out if he raised the rent, and so he kept it at what she originally rented the apartment for.  This works well if you are a quiet person/couple, pay rent on time, and keep the place in good condition because if you are all these things, they will want to keep you as a tenant.
 

           What Can Tenants Do? 
 

1. Make sure you state in the contract that the rent will automatically renew every year and do not agree to cost of living increases.  Negotiate very hard that the rent is already the top end for Ecuador as Cuenca is the most expensive city in Ecuador, as we are plainly reminded by so many local Ecuadorians.
 

2. If the landlord makes updates and repairs to the home/apartment then $25 a month rent increase seems fair to everyone, after the two year period is up, or whatever you specified in the rental agreement. However, if your landlord doesn’t fix things then what is a rent increase for?
 

As we all know, homes with everyday use begin to show signs of disrepair, such as leaky pipes, ceilings/roofs might need repaired, fresh paint job, etc. The landlord/owner needs to pay for the updating and repairs to the home.  Otherwise, let them know you are prepared to move on. Remember, always be kind but firm.

3. If you are a handy person/couple and would like to do the home repairs yourself, that’s fine too, as long as the landlord pays for the materials, and then NOT raise the rent, since after all, you’re fixing and updating everything yourselves. You would be actually saving them money.


4.  Be a good tenant. Keep the place nice and clean, don’t be loud, have parties and be noisy and hopefully they’ll want to keep the rent low and fair for everyone!
 

Remember, if they want to raise the rent too much and they are adamant about it, all you can do is move out and find another home or apartment, and this time make sure to make the needed adjustments in the contract so they cannot raise the rent to an unfair amount.

    Alicouta  (Maintenance - Security) Increase
 

There is a high rise apartment building in Cuenca that just three short years ago started their alicuota  at $7.50 a month, then it went to $15 dollars a month, and after a year it was at $35 dollars, and in January 2014 it had risen to $50, all of these increases after the place got full of gringos.  And, get this, they still charge $5 each use of the pool and Jacuzzi even after paying $50 per month for this stuff they initially were saying was included in the monthly building fee. (alicuota)
 

So, we’re just saying, this is another rental hike that you, as a gringo will have to contend with if you live in an apartment or gated town home. At some point the community of such buildings needs to come together and say “NO” to big alicouta increases; otherwise they will continue to raise it every couple of months. It’s up to you, how much do you want to pay?
 

On a lighter note we have new information about light fixtures in rental homes.
 

         Hallelujah to Light Fixtures
 
It was only 2-years ago when most rentals in Cuenca did not have light fixtures; in fact what you would see was an obtrusive light bulb dangling out of the ceiling with wires exposed, and it was very unsightly.  Amazingly even some of the higher priced rentals did not have light fixtures. We guessed it was because they would get stolen by the tenants and the landlords got tired of having to buy new ones every time they rented out the place.
 

We wrote about the missing of light fixtures several times on the blog, and we even used to use the “no light fixtures” as a negotiating tactic with many of the landlords. Frank often said something about it, such as lowering the rent, or not putting down a deposit, etc.  Today many of the rental homes in Cuenca have light fixtures installed. We’re very happy about this as it takes away from the ambiance of a home when ugly, glaring light bulbs are dangling off some wiring and hanging out of the ceiling.
 

Our rental home did not have light fixtures and as a result we managed to get creative and just made our own light covers out of bamboo place mats and Chinese chop sticks. The covers go well with our rustic built furniture and we are happy with how it looks.
 

Frugality has its rewards as it was an inexpensive way to cover the ugly dangling light bulbs; After all, we do not own the home and it usually is not the tenant’s responsibility to procure light fixtures for a rental home or apartment.  Light fixtures are not cheap here; prices start at $25 dollars for a basic cover, so imagine covering 10 dangling light bulbs?
 

We still see some rentals without light fixtures but we see just as many with them now and we’re happy about that.  Remember, it is not the tenants responsibility to have to buy light covers for a rental home in Cuenca, or anywhere for that matter. Gringos will not take the light fixtures when they leave, so explain that to your landlord if you happen to rent a home without light fixtures, and or negotiate something that is fair to everyone, not just the landlord.
 

           Renting to Gringo Families
 
Some landlords in Cuenca resist renting to gringos with several children, no matter the age. If the home is a four bedroom then the landlord automatically thinks a bedroom per child. A couple with four teenage children moved to Cuenca recently and a four bedroom wasn’t big enough for this 5-person family. The landlord said, “Too many children”, there’s only four bedrooms” and she would not rent to a gringo family.  This is not a one time happening either, it is a reoccurring theme we are seeing in Cuenca.
 

Ecuadorians are also resistant to rent to folks with pets, especially if the house or apartment is furnished, and rightly so. Anyone with pets looking for a furnished will pay big dollars just to get into the home, plus a larger rent amount. There’s no way getting around it.
 

Money talks here in Ecuador and if you are willing to pay big bucks just because you have two, three, four children or a dog then that’s up to you.  We think it is ridiculous what is negatively happening to Cuenca and the rental market, especially when it comes to gringos with children. 
 

Our take: We understand paying more because of a dog living in the home, but (teenage) children? Now that is another thing altogether.  A result of a city being named “best retirement” is that landlords get used to renting to one or two older folks, and when they see younger families, they know they can reject them because right around the corner is another retired couple ready to rent.  Best retirement city?  Looks like a two edged sword from here.   

We're an Expat Family of Five Living Frugal, Healthy and Happy in Cuenca Ecuador! Enjoy the Discover Cuenca Ecuador blog!

2 comments:

  1. I agree it's ridiculous were the rents are going and it is pure greed but you have to put some of the blame on the people moving to Ecuador that will pay anything and not first find out what is the normal rental prices. Then not rent when they are asked to pay a higher price. In Ca everything is outrageous but there is no negotiation here. One cabbage is 3 dollars everything is through the roof. When my parents moved to the USA no one wanted to rent to them because they had two children and then they had to pay extra for it. I'm not saying it's right but it's not the only place in the world doing it. And money talks all over the world, you can even get a US Visa if you have enough money with a criminal record, so I do agree there money does talk big time. I hope people stop paying increases in rents and things go back to semi normal.

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    Replies
    1. No matter where you live in the world, there is always going to be the persons that will pay more, just because they have the money. This is why prices will continue to rise here. Thanks for sharing and commenting.

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