Preparing Your Cuenca Home for Showings: An Expat's Essential Legal and Financial Checklist

As an expat selling your property in Cuenca, preparing your home for showings goes beyond aesthetics. In Ecuador, a successful sale relies on impeccable legal and financial documentation. As a Real Estate Broker and Lawyer in Cuenca, my role is to shield your investment from the transaction's complexities. Overlooking a single document or municipal requirement can delay—or even nullify—a sale. This guide provides a checklist focused on the critical legal and financial groundwork for a secure and efficient closing.

The Legal Foundation: Ensuring an Irrefutable and Transferable Title

Before marketing begins, your property's legal status must be beyond reproach. This is the most crucial phase of the selling process.

1. The Holy Trinity of Ownership Documents

Your ownership is proven by a chain of documents that must align perfectly. Any discrepancy is a deal-breaker for a knowledgeable buyer and their lawyer.

The Deed (Escritura Pública de Compraventa): This is your ultimate proof of ownership. We will conduct a line-by-line review to ensure your name, passport/cédula number, and the property's legal description (linderos or boundaries) are exact.
The Municipal Cadaster (Catastro Municipal): This is the city's official map and tax record. We will confirm the measurements and building footprint in the Catastro match your Escritura. Discrepancies, common in older properties, must be legally rectified.
The Property Registry (Registro de la Propiedad): This is the definitive public record. We will immediately pull a Certificado de Gravámenes y Prohibiciones (Certificate of Liens and Encumbrances). Hyper-Specific Detail #1: This certificate is the most important preliminary document, revealing any mortgages (hipotecas), legal judgments, easements, or prohibitions against selling. It is valid for 60 days, and the Notary Public (Notario) will refuse to proceed with closing without a clean certificate issued just days before signing.

2. Municipal and Construction Compliance

Cuenca's municipal government (GAD Municipal de Cuenca) is strict. A property cannot be transferred without its blessing, which requires proof of good standing.

Property Taxes (Impuesto Predial): All property taxes for the current year must be paid. We will secure the Certificado de No Adeudar al Municipio (Certificate of No Debt to the Municipality), another non-negotiable document for closing.
Unregistered Construction - A Common Expat Pitfall: Did you add a terrace, enclose a patio, or build a small casita without a permit? This is a serious issue. Hyper-Specific Detail #2: Any construction not on original plans must be legalized through a Declaratoria de Fábrica. This involves an architect creating new plans, municipal approval, paying fines, and updating the Catastro and Registro de la Propiedad. This process can take 3-6 months and must be initiated long before listing. Selling with undeclared construction is a major liability.
Horizontal Property (Propiedad Horizontal): If selling an apartment or condo, you must be current on all HOA fees (alícuotas). We will obtain a signed and notarized certificate from the building administrator confirming a zero balance. Be prepared to provide the buyer with a copy of the community's bylaws (Reglamento Interno).

Financial & Tax Obligations: Protecting Your Proceeds

Understanding seller tax obligations is critical for accurately calculating your net proceeds. These are often misunderstood by foreign sellers.

Capital Gains Tax (Plusvalía): This is a municipal tax on the "extraordinary gain" from the sale. Hyper-Specific Detail #3: There's a myth that no capital gains are due after five years of ownership. While this exemption can apply to Ecuadorian citizens under specific conditions, it is not automatically granted to foreign residents. The municipality's interpretation can vary. Plan for this expense. The tax is calculated on the difference between your purchase and sale price, or on the increase in the municipal valuation (avalúo catastral), whichever is greater. We will calculate the estimated Plusvalía upfront.
Property Transfer Taxes (Alcabalas): Hyper-Specific Detail #4: While the buyer is legally responsible for paying the primary transfer taxes (Alcabala and Registro), you as the seller must be aware of them. The Alcabala tax in Azuay province is approximately 1% of the municipal valuation. Understanding the buyer's closing costs aids in negotiation by providing a complete financial picture.

Preparing the Physical Space: Mitigating Risk and Maximizing Appeal

With legal and financial pillars secured, we focus on presentation. Every practical step should be viewed through a lens of legal transparency.

1. Declutter, Depersonalize, and Deep Clean

This standard advice has a legal dimension in Ecuador. A cluttered, poorly maintained home can signal hidden problems, prompting more aggressive inspections and potential disputes. Present a clean, neutral canvas.

2. Address Obvious Repairs

Fix leaky faucets, cracked tiles, and sticky doors. While Ecuadorian law recognizes "as-is" sales, failing to address minor, visible defects can erode trust. More importantly, it prevents buyers from using these issues to negotiate a lower price or claim you concealed larger problems.

3. Disclosure of Known Defects (`Vicios Ocultos`)

In Ecuador, a seller can be liable for vicios ocultos—significant hidden defects known to the seller but not disclosed. This could be recurring leaks, structural issues, or a faulty septic system. Hyper-Specific Detail #5: Unlike in the US, there isn't a standardized disclosure form. Disclosure is typically handled as a clause within the Promesa de Compraventa (preliminary buy-sell agreement). It is legally imperative to be honest. We will document any known material defects, protecting you from post-sale litigation. Transparency is your best defense.

Seller's Pre-Showing Due Diligence Checklist:

[ ] Escritura Pública: Verified for accuracy.
[ ] Certificado de Gravámenes: Pulled and reviewed for liens.
[ ] Catastro Municipal: Confirmed records match the physical property and deed.
[ ] Declaratoria de Fábrica: Process initiated or completed for any unregistered construction.
[ ] Certificado de No Adeudar al Municipio: Obtained.
[ ] HOA Certificate: Zero balance confirmed (if applicable).
[ ] Plusvalía Tax: Estimated liability calculated.
[ ] Known Defects (Vicios Ocultos): Documented for transparent disclosure.
[ ] Repairs, Cleaning, & Staging: Completed to present the property in its best light.

⚠️ Broker's Legal Warning: The Two Greatest Risks to Your Sale.

The two most devastating—and common—legal problems that derail expat property sales in Cuenca are:

Undeclared Construction: A buyer's lawyer will spot discrepancies between the property and its registered plans. This will halt the sale until the lengthy and costly Declaratoria de Fábrica process is complete. Address this before listing.
Concealing Known Defects (Vicios Ocultos): Hiding recurring issues like water intrusion or a failing foundation is unethical and can lead to a lawsuit demanding rescission of the sale or payment for exorbitant repairs. The legal system provides recourse for misled buyers.

Your best protection is proactive due diligence. By addressing every item on this checklist before the first showing, we replace uncertainty with legal certainty, building trust with potential buyers and paving the way for a smooth, successful closing.