Rental Law in Uruguay 2026: Rights and Contracts

INGAR · 2026-02-13 · Rentals

What This Guide Covers

In Uruguay, every residential rental contract is governed by Decree-Law 14.219 of 1974. No matter what the contract says: if a clause contradicts this law, it is void. The contract continues; the clause does not.

The problem is that most tenants (and many landlords) sign without knowing the law. Then come the surprises: a rent increase that wasn't due, an eviction that can't be demanded, a deposit that isn't returned, a commission that shouldn't have been charged.

This guide is a complete walkthrough of the rental law currently in force in Uruguay. It is not legal advice — for your specific situation, consult a lawyer or notary. But if you're about to sign a contract, renew one, or resolve a dispute, here you'll find the legal foundation you need.

Before continuing, if you're still putting together your application file, review requirements for renting in Montevideo. And if you have questions about which guarantee suits you best, read rental guarantees in Uruguay.

The Legal Framework: What Rules Govern Rentals in Uruguay

There is not a single rental law. Several regulations coexist, and which one applies depends on the case. The main ones:

Regulation	What It Governs	Applies To
Decree-Law 14.219 (1974)	Urban and suburban leases	The majority of residential rentals in Uruguay
Law 13.292 (1964)	Free-market contracting regime	Properties built after June 1968 (unless parties opt into 14.219)
Law 19.889 (LUC), arts. 418-428 (2020)	No-guarantee leases for housing	Contracts where the tenant does not provide a guarantee
Civil Code, arts. 1776-1844	General lease rules	Supplementary for everything not covered by the special law

In practice, the vast majority of residential rental contracts with a guarantee fall under Decree-Law 14.219. That is the regulation we will break down in this guide.

Minimum Term: 2 Years for Housing, No Exceptions

Article 1 of Decree-Law 14.219 establishes minimum legal terms that cannot be reduced by contract:

Housing (primary residence): minimum 2 years.
Industry and commerce: minimum 5 years.
Other uses: minimum 2 years.

If you sign a 1-year contract, the term is void to the extent it harms you. The contract is automatically extended to 2 years, and the difference benefits the tenant exclusively. In other words: the landlord cannot force you out before 2 years, but you can leave after one year if the contract allows it.

Important detail: there is no explicit legal maximum term in the 14.219, but the Civil Code sets a general maximum of 15 years for leases.

The Good-Payer Extension

This is one of the strongest protections tenants have in Uruguay, and one that few people fully understand.

At the expiry of the contractual term (whether the legal minimum or a longer agreed one), if the tenant has met their obligations — paid on time, maintained the property, caused no damage — they are entitled to an additional 1-year extension.

You don't need to request it. It operates automatically simply by not handing over the property on the expiry date. The landlord cannot prevent it if you have been a good payer.

During that extension:

Rent is adjusted according to the rules of article 15 (the lower of URA and CPI, explained below).
All original contract conditions apply.
The landlord may initiate eviction proceedings, but with a 1-year period for actual vacation of the property.

In total, a 2-year contract with a good-payer extension gives you a minimum of 3 years of occupancy. If eviction is initiated at the end of the extension and the 1-year period is granted, 4 years may pass from when you signed.

Annual Rent Adjustment: The "Lower of URA and CPI" Rule

Article 15 of Decree-Law 14.219 establishes how rental prices are adjusted. It is not optional: it is the legal rule, and any clause that sets a more burdensome adjustment mechanism for the tenant is void.

The mechanism works as follows:

Calculate the variation of the CPI (Consumer Price Index, published by the INE) over the 12 months prior to the adjustment month.
Calculate the variation of the URA (Rental Adjustment Unit) over the same 12 months. The URA is a 3-month average of the Reajustable Unit (UR).
The adjustment coefficient is the lower of the two.

This protects the tenant: if inflation (CPI) rises 8% but the URA rose 6%, your adjustment is 6%. And vice versa.

Example with Real Values

For contracts that adjusted in January 2026, the published coefficient was 1.0365 (i.e., an increase of 3.65%). If you were paying $25,000 in rent, you moved to paying $25,913.

The Executive Branch publishes the monthly values of UR, URA, and the rental adjustment coefficient by decree. You can find updated values at IMPO - UR, URA, and CRA Values.

If the Contract Says Otherwise

Some contracts establish adjustment by UR (not URA), direct CPI, or "whichever index results in the higher figure." If the agreed mechanism results in a larger increase than the legal coefficient, the tenant can invoke article 15. In practice, many modern contracts already state "according to the rental adjustment coefficient published by the Executive Branch," which is exactly the legal mechanism.

And one point that causes a lot of confusion: the adjustment is annual. It cannot be applied every 6 months unless the parties agree to a stepped pricing arrangement (which is different from an index-based adjustment).

The Guarantee: Legal Limits and Types

Decree-Law 14.219 sets maximum limits for the guarantee the landlord may require:

Property Use	Maximum Guarantee
Housing (primary residence)	5 months of rent
Commerce, industry, other uses	10 months of rent

That limit applies to the value of the guarantee, not the form. The most common types in Uruguay are:

ANDA guarantee: surety bond. The tenant pays a premium (generally equivalent to 4-5 months' rent) and ANDA guarantees the landlord.
BHU guarantee: deposit at the Banco Hipotecario (Mortgage Bank). The tenant locks up funds that are returned at the end.
Cash deposit: deposited in Reajustable Mortgage Bonds at the BHU within 15 days of signing the contract.
Personal guarantee (guarantor): a third party assumes joint and several liability.
Private surety bond: insurance companies such as Porto, Sura, etc.

A detail that few people know: under the law, the tenant can always substitute a personal guarantee with a deposit in Reajustable Mortgage Bonds, and the landlord cannot object (unless legal proceedings have already begun).

For a comparative analysis of costs, timelines, and requirements for each guarantee: rental guarantees in Uruguay.

What a Rental Contract Must Contain

A rental contract in Uruguay must be in writing. Although a verbal agreement can be proven in court, in practice without a written contract you are in a very weak position. A complete contract must include:

Identification of the parties: full name, national ID number, address of the landlord (lessor) and tenant (lessee). If a real estate agency acts on behalf of a party, its details must also be included.
Description of the property: exact address, land registry number (padron), floor, unit, floor area. If a garage, storage unit, or parking space is included, it must be stated explicitly.
Intended use: residential, commercial, professional. This matters because minimum terms and maximum guarantees change depending on use.
Price and currency: monthly rent amount, currency (pesos or foreign currency equivalent converted to pesos), and payment deadline.
Adjustment mechanism: index, frequency, and date of first adjustment. The correct wording is "according to the rental adjustment coefficient published by the Executive Branch."
Term: start date, end date, and renewal conditions if any.
Guarantee: type, amount, how it is established, and conditions for return at the end.
Expenses: what each party pays. Rent, ordinary common fees, property tax (contribucion inmobiliaria), utilities (water, electricity, gas), primary education tax.
Inventory: the condition of the property and everything it contains. It is part of the contract. It must be signed by both parties, ideally with photographs.
Early termination conditions: required notice, penalties if any.
Maintenance and repairs: who is responsible for what.

If the property is in a horizontal property regime (condominium), also read the co-ownership bylaws: horizontal property in Uruguay.

Illegal Clauses: What a Contract Cannot Say

Decree-Law 14.219 is public order legislation. This means it protects the tenant above and beyond what the parties agree. Any clause that contradicts the law is automatically void. The most common ones we see at INGAR:

Clause	Why It Is Void
"The term is 12 months"	The legal minimum is 24 months. The contract is automatically extended.
"Adjustment will be by whichever index is higher between CPI and URA"	The law says the lower. The opposite is prejudicial to the tenant.
"Adjustment will be semi-annual"	The legal adjustment is every 12 months. Shorter frequencies are not permitted for index-based adjustments.
"The tenant waives the right to the good-payer extension"	Rights granted by law cannot be waived in advance.
"Rent will be paid in US dollars"	Under 14.219, the price is set in national currency. It can be referenced in foreign currency, but payment is in pesos at the prior day's exchange rate.
"In the event of default, the tenant is automatically subject to eviction"	Default does not operate automatically. It must be judicially notified. The tenant has the right to pay and cure the default.
"The guarantee will not be returned if the tenant terminates early"	The guarantee covers unmet obligations; it is not a penalty for early termination.
"The landlord may enter the property at any time"	The tenant has the right to privacy and peaceful enjoyment of the property. Visits require prior agreement.

The fact that a clause is printed in the contract does not mean it is valid. If the law invalidates it, it is as if it did not exist. But note: to enforce this in court you need to claim it. Knowing it isn't enough.

Tenant Rights

Decree-Law 14.219 and the Civil Code give the tenant a set of rights that do not depend on what the contract says:

1. Habitability

The property must be in habitable condition. This includes functioning sanitary facilities, water supply, a roof without leaks, electrical installation in good condition, and a secure structure. If the property has defects that make it uninhabitable and the landlord has been notified and does not make repairs, the tenant may seek contract termination or a rent reduction.

2. Essential Services

The landlord cannot cut off services (water, electricity, gas) as a pressure tactic. If they do, the tenant may go to court. Cutting services to force a vacating of the property is a crime (coercion) and also invalidates any eviction claim.

3. Privacy and Peaceful Enjoyment

Once possession is transferred, the property is the tenant's home. The landlord cannot enter without prior consent or make visits without coordinating. In practice, the reasonable approach is to include in the contract a prior notice mechanism (48 hours, for example) for inspections or showings to prospective tenants near the end of the contract.

4. Return of the Guarantee

When the contract ends and the tenant returns the property in the agreed condition (allowing for normal wear and tear), the landlord must return the guarantee. If the guarantee was a BHU deposit, it is withdrawn along with accrued interest. If there was damage or outstanding debts, the landlord may retain the corresponding portion, but cannot keep the entire guarantee "just in case." Any retention must be justified and documented.

5. Legal Rent Adjustment

As discussed: you have the right to have rent adjusted by the legal coefficient (lower of URA and CPI), not by what an abusive clause may state.

6. Minimum Occupancy Period

You cannot be evicted before 2 years (housing) except on serious grounds (non-payment, property damage, use different from the agreed one). And after the term, the good-payer extension gives you 1 more year.

Landlord Rights

The law protects the tenant, but the landlord also has clear rights:

1. Receive Rent on Time

The tenant must pay within the agreed period (generally the first 5 or 10 days of the month). If they don't pay, the landlord can judicially demand payment and, if non-payment persists, initiate eviction for non-payment.

2. Require Proper Use of the Property

The tenant must use the property in accordance with the agreed purpose (housing, commercial use, etc.) and maintain it with the care of a "good family head" as per the Civil Code. This includes not making structural modifications without authorization, not causing damage, and not changing the intended use.

3. Inspect with Prior Notice

The landlord has the right to verify the condition of the property, but with prior notice and at reasonable hours. The tenant cannot systematically refuse coordinated inspections.

4. Recover the Property When the Term Expires

Once the legal terms have run (contract + good-payer extension, if applicable), the landlord may request eviction. They may also request vacation if they need the property for their own use or for the use of immediate family members (necessity ground).

5. Execute the Guarantee Upon Default

If the tenant leaves with outstanding rent, property damage, or common fee debts, the landlord may execute the guarantee to cover them. But the damage or debt must be evidenced and documented.

Maintenance and Repairs: Who Pays for What

This is one of the most conflict-prone topics. The general rule comes from the Civil Code (articles 1798-1799) and is complemented by the 14.219:

Type of Repair	Responsibility	Examples
Necessary repairs (structural, major installations)	Landlord	Roof leaks, burst pipes, general electrical installation problems, structural dampness
Locative repairs (normal wear and tear)	Tenant	Interior painting, dripping taps, stuck locks, broken glass, cleaning drains
Improvements (adding value to the property)	Whoever proposes them, with prior agreement	Air conditioning, built-in closets, kitchen remodeling

If the landlord fails to make necessary repairs after being notified, the tenant may invoke the defense of non-performance: you are not obligated to fulfill your part (paying the full rent) if the other party does not fulfill theirs (keeping the property habitable). But be careful: this requires prior formal notice and it is advisable to seek legal advice before withholding payments.

Ordinary common fees are the tenant's responsibility. Extraordinary common fees (building repairs, common-area improvements, waterproofing) belong to the landlord. More detail at common fees: what they include and how they are calculated.

Early Termination by the Tenant

Here it is important to distinguish two situations:

Contracts Under Decree-Law 14.219

The law does not expressly provide for a unilateral right of early termination by the tenant. What it does allow is for termination conditions to be agreed upon in the contract. In practice, most contracts include an early exit clause that typically establishes:

Notice of 60 to 90 days (most common in the market).
Penalty: some contracts set a penalty equivalent to 1 or 2 months' rent if termination occurs before a certain point (generally the first year).
No penalty after the first year in many contracts, provided the notice period is respected.

If the contract says nothing about early termination, the situation is more complicated. The tenant would in principle be obligated to fulfill the full term, and the landlord could claim the remaining rent. In practice, Uruguayan case law tends to be more flexible, but this is a scenario you want to avoid.

INGAR tip: if you're about to sign a contract, make sure it includes an early termination clause with clear conditions. It's cheaper to negotiate it before signing than to litigate it afterward.

Contracts Under LUC (No Guarantee)

Under the Law 19.889 (LUC) regime, either party can end the contract with a notice of 30 days. And if no notice is given, the contract automatically renews for periods equal to the agreed term. It is a much more flexible regime, but with less general protection (eviction of a good payer is reduced to 30 days instead of 1 year).

The Eviction Process: How It Works and How Long It Takes

Eviction in Uruguay is a judicial process. There is no "extrajudicial eviction" — if the landlord changes the lock or cuts services to force the tenant out, they are committing a crime. Everything goes through a judge.

Grounds for Eviction Under 14.219

The main grounds are in articles 24 and 26:

Expiry of the contractual term (including the good-payer extension).
Non-payment (bad payer): when the tenant doesn't pay and is judicially notified.
Landlord's necessity: for use by the landlord or immediate family members (parents, children, spouse).
Demolition or reconstruction: when the landlord is going to demolish the property for reconstruction or new construction.
Use different from the agreed one: if the tenant changes the intended use of the property (for example, opens a business in a residential unit).
Unauthorized subletting: if the tenant sublets without permission.
Property damage: serious deterioration caused by the tenant.
Precarious occupant: a person occupying without any legal title (not technically a "tenant").

Eviction Timelines by Ground

Ground	Time to Vacate
Term expiry (good payer)	1 year
Landlord's necessity	1 year
Demolition / reconstruction	1 year
Non-payment (bad payer)	20 days
Precarious occupant	15 days
Other grounds (improper use, subletting, damage)	Up to 180 days (at the judge's discretion)

The Process Step by Step

Filing: the landlord files the eviction claim with the Justice of the Peace (for lower-value cases) or the District Court.
Eviction order: the judge orders the eviction with the timeline corresponding to the ground cited.
Notification and defenses: the tenant is notified and has 10 days to raise defenses (objections).
Transfer and hearing: if defenses are raised, they are transferred to the landlord for 6 days and a hearing is called to produce evidence.
Judgment: the judge issues a ruling within 30 days of completing the evidentiary stage.
Enforcement: if the ruling confirms eviction and the tenant does not vacate, it is enforced with the assistance of law enforcement.

In practice: an eviction for term expiry of a good payer can take between 14 and 18 months from filing to actual vacation. An eviction for non-payment, between 2 and 4 months if the tenant raises no defenses.

Eviction for Non-Payment: The Prior Notice Requirement

To initiate an eviction for non-payment, the landlord must judicially notify the tenant of the debt. The tenant can cure the default by paying the amount owed (with interest and costs) before judgment. If they pay, the eviction case is dropped. But note: the law limits the number of times a tenant can cure a default. If it happens again, they lose the right.

Real Estate Agency Commission

In Uruguay, real estate commissions for rentals are regulated by the fee schedule of the Camara Inmobiliaria Uruguaya (CIU). The market standard is:

Item	Amount	Charged To
Commission for rental management	1 month's rent + VAT (22%)	Tenant
Commission to landlord	1 month's rent + VAT (22%)	Landlord

In other words, the agency charges both parties. The commission includes contract management, signature coordination, inventory, and guarantee processing.

If the contract is renewed, the agency is entitled to charge its commission again as if it were a new contract (as established by the CIU fee schedule). This is something many tenants don't expect.

For short-term rentals (up to 5 months), the commission is different: 8% of the total contract value + VAT.

LUC Contracts (No Guarantee): The Alternative Regime

Since 2020, the Urgent Consideration Law (Law 19.889, articles 418 to 428) created a special regime for residential leases without a guarantee. It was designed to facilitate housing access for people who cannot provide a guarantee (ANDA, BHU, deposit, or guarantor).

The main differences from the 14.219 regime:

Aspect	Decree-Law 14.219	LUC (No Guarantee)
Guarantee	Up to 5 months	Not required
Minimum term	2 years	No legal minimum
Maximum term	15 years	15 years
Rent adjustment	Lower of URA and CPI	Free (parties agree)
Currency	Uruguayan pesos	Free (pesos, USD, UI, UR)
Extension	1 year (good payer)	Automatic for same term as agreed, unless 30-day notice given
Good-payer eviction	1 year	30 days
Termination	As per contract	30 days' notice

The LUC regime is more flexible but less protective for the tenant. The 30-day eviction period (versus 1 year under 14.219) is the most significant difference. It's a trade-off: you gain access without a guarantee, but your position in an eviction is much weaker.

Virtual Meetings in Horizontal Property Regimes

Since July 2022, Law 20.058 has enabled co-owner meetings in virtual or hybrid format. If you rent in a condominium building, this affects you indirectly: assembly decisions (extraordinary fees, works, bylaw changes) impact your common fees.

Key points of Law 20.058:

Ordinary and extraordinary meetings can be in-person, virtual, or hybrid.
Notice must be sent with the same advance notice required by law or the bylaws.
Documents to be considered (budgets, reports) must be sent to co-owners with at least 48 hours' notice.
The platform used must allow simultaneous two-way audio and video communication between all participants.

As a tenant, you don't vote at the meeting (that is the landlord's right), but you have the right to be informed by your landlord about decisions that affect your situation (works that cause disruption, extraordinary common fee increases, etc.).

Quick Reference Table: All the Essentials at a Glance

Topic	Legal Rule	Reference
Minimum term (housing)	2 years	DL 14.219, art. 1
Minimum term (commercial)	5 years	DL 14.219, art. 1
Good-payer extension	1 year automatic	DL 14.219
Rent adjustment	Annual, lower of URA and CPI	DL 14.219, art. 15
Maximum guarantee (housing)	5 months' rent	DL 14.219
Maximum guarantee (commercial)	10 months' rent	DL 14.219
Eviction (good payer)	1-year period	DL 14.219, art. 36
Eviction (non-payer)	20-day period	DL 14.219, art. 48
Real estate commission	1 month + VAT to each party	CIU Fee Schedule
Contract currency	Pesos (foreign currency reference permitted)	DL 14.219

Checklist Before Signing

Before signing a rental contract, verify these points and ask for them in writing if any are missing:

Term and renewal: start date, end date, extension conditions.
Adjustment: index ("rental adjustment coefficient"), annual frequency, date of first adjustment.
Guarantee: type, amount, how it is established, return conditions at the end.
Expenses: what the tenant pays (rent, ordinary common fees, utilities) and what the landlord pays (property tax, extraordinary common fees, major repairs).
Maintenance: what counts as a locative repair (tenant) and what counts as a necessary repair (landlord).
Inventory: signed by both parties, with photographs, including condition of floors, walls, windows, appliances, and fixtures.
Early termination: required notice, penalties if any, from when early termination is possible.
Pets and use restrictions: whether they are allowed, building rules.
Real estate commission: exact amount, who is charged, what is included.

One point many people overlook: read the inventory with the same attention as the contract. It is the document that defines the condition in which you received the property, and it is the reference when you leave. If you don't sign an inventory, you cannot later prove what condition it was in when you moved in.

Mistakes We See Every Month

Signing without reading the adjustment mechanism. Then the first adjustment comes and it's higher than expected. Check that it says "rental adjustment coefficient" and not a different index.
Not doing an inventory. At the end of the contract, the landlord claims damages that were already there when you moved in. Without a signed inventory, you have no way to defend yourself.
Not clarifying what the rent includes. Garage, storage unit, kitchen equipment: if it isn't written, it isn't included.
Paying cash without a receipt. If you have no payment confirmation, you have no proof. Always use bank transfer or signed receipt.
Not knowing the difference between ordinary and extraordinary common fees. You pay ordinary fees. Extraordinary fees (building repairs, new elevator, waterproofing) belong to the landlord. If they are passed on to you, object.
Not negotiating the early termination clause. If you later need to leave before the term and there's no clause, you will have a serious problem.
Thinking the contract overrides the law. If a clause contradicts Decree-Law 14.219, it is void even though you signed it. But you need to invoke the law for it to apply.

Frequently Asked Questions

Can I rent in US dollars?

Under the 14.219, no. The price is set in pesos. You may reference a foreign currency equivalent, but payment is made in pesos at the prior day's exchange rate. Under the LUC regime (no guarantee), yes — the contract may be denominated in USD, UI, or UR.

What happens if the landlord sells the property?

Your contract remains in force. The new owner steps into the previous owner's position: they must respect the term, conditions, and guarantee. You cannot be evicted because "ownership changed."

Can I sublet?

Only if the contract expressly authorizes it. If you sublet without permission, the landlord can seek eviction.

What do I do if the landlord doesn't return the guarantee?

First, notify them formally in writing (certified letter or equivalent). If they don't respond or refuse, you can file a judicial claim. If the guarantee was a BHU deposit, withdrawal requires the landlord's consent or a court order.

What if the landlord raises rent above the legal limit?

Pay what is due according to the legal coefficient and notify the landlord in writing that the increase exceeds the legal maximum. If they insist, the avenue is the courts. But don't stop paying: non-payment, even partial, can give grounds for an eviction claim for non-payment.

Can I make improvements to the property?

Only with the landlord's written authorization. If you make improvements without authorization, you cannot claim reimbursement. If you make them with authorization and the contract is silent on who pays, the general rule is that they become part of the property without compensation. That's why it always needs to be in writing.

How long does an eviction take in practice?

It depends on the ground. An eviction for non-payment with no defenses raised: 2 to 4 months. An eviction for term expiry with the good-payer extension: 14 to 18 months or more if defenses and appeals are filed. The Uruguayan court system is slow, and in practice that benefits the tenant.

Sources

IMPO - Decree-Law 14.219 (urban and suburban leases):
https://www.impo.com.uy/bases/decretos-ley/14219-1974
IMPO - Law 19.889 (LUC), articles 418-428:
https://www.impo.com.uy/bases/leyes/19889-2020/422
IMPO - Law 20.058 (virtual meetings in horizontal property):
https://www.impo.com.uy/bases/leyes/20058-2022
IMPO - UR, URA, and Rental Adjustment Coefficient values:
https://www.impo.com.uy/valores
CIU - Camara Inmobiliaria Uruguaya, rental process:
https://ciu.org.uy/comercial/proceso-de-arrendamiento/
INE - Consumer Price Index:
https://www5.ine.gub.uy
Ministry of Economy and Finance - Tenant rights and obligations:
https://www.gub.uy/ministerio-economia-finanzas/garantia-de-alquileres/derechos-obligaciones-del-inquilino
Asociacion de Escribanos del Uruguay:
https://www.aeu.org.uy/

This guide is for informational purposes only and does not constitute legal advice. For specific situations, consult a lawyer or notary specializing in rental law.