Real Estate Sector
Real estate agents are reporting entities under Tranche 2. Here's what you need to know before 1 July 2026.
From 1 July 2026, new AML/CTF compliance obligations (called Tranche 2) will apply to the Real Estate Sector. AUSTRAC enrolment opens 31 March 2026.
The path to 1 July 2026 is defined by clear legislative and regulatory milestones
AML/CTF Amendment Act Passed
Nov 2024
Finalisation of AML/CTF Rules
Aug 2025
Core Guidance from AUSTRAC
Oct 2025
Sector-Specific Guidance for Real Estate
Early 2026
AUSTRAC Enrolment Opens
31 Mar 2026
Mandatory Compliance Commences
1 Jul 2026
The Australian real estate sector has been assessed as having a high money laundering risk. Professionals are viewed as critical gatekeepers.
Why real estate is a prime focus for regulators
Storing Value
Property is commonly used to store and grow the proceeds of crime.
Integrating Funds
It can be geared, renovated and resold to integrate illicit funds into the legitimate economy.
Facilitating Crime
Residential and commercial properties can be used to facilitate other criminal activity (e.g., 'supply houses' for drug operations).
Enabling Access
Real estate professionals are often one of the first points of contact for criminals seeking to move illicit funds into property.
ML/TF/PF Risks in the Real Estate Sector
The real estate sector faces significant money laundering (ML), terrorism financing (TF) and proliferation financing (PF) risks. Property is commonly used to store, grow and integrate the proceeds of crime.
Identity Verification
Customer due diligence
Inadequate verification of customer identity leading to onboarding of high-risk clients.
Unusual Transactions
Transaction monitoring
Failure to detect structured payments or unusual transaction patterns.
Sanctions Exposure
Prohibited dealings
Risk of inadvertently dealing with sanctioned entities or persons.
Beneficial Ownership
Ownership opacity
Complex ownership structures obscuring the true beneficial owners of assets or entities.
Are you providing a 'designated service'?
The regime is service-based, not job-title based. It applies even if a service is discounted or pro bono.
Brokering real estate sales
Listing and selling agents, buyer's agents and project marketers who broker the sale, purchase or transfer of real estate.
When it starts: When you sign an agreement to broker the sale (seller's agent) or find property (buyer's agent).
Direct sales without an agent
Property developers selling house/land packages, apartments off the plan, or new lots using in-house teams.
When it starts: When a commitment to sell is made and a real buyer identified.
What is 'real estate'?
It includes freehold, leaseholds over 30 years, and certain 'land use entitlements'. It generally does not include short-term leases or movable dwellings like caravans.
Who May Be Captured?
The key trigger is designated services. Real estate agents, buyer's agents, developers and project marketers are all potentially in scope.
Residential agents
Home sales and property transactions
Commercial agents
Business and commercial property sales
Agricultural agents
Rural and farming property transactions
Auctioneers
Property auction services
Buyer's agents
Representing purchasers in property searches
Property developers
Direct sales without independent agents
Whether you are captured depends on the designated services you provide. If unsure whether you're covered, please seek legal advice. Even if you are not covered, you may consider implementing guardrails to ensure you don't accidentally cross lines.
Some real estate activities remain outside scope
The following activities are generally not designated services, provided they are not part of a broader in-scope transaction:
Property Management
Pure property management activities (rental management, maintenance coordination) where no sale is involved.
Short-term Leases
Leases of less than 30 years and short-term holiday rentals are not covered.
Valuations and Appraisals
Providing property valuations or market appraisals without involvement in the sale transaction.
Auctioneering (non-property)
Conducting auctions for items other than real estate (e.g., livestock, vehicles, household goods).
Building and Construction
Providing construction, renovation, or building services without selling the completed property.
Advisory Services
Providing market advice, feasibility studies, or development consulting without executing transactions.
Once you are a reporting entity, you have six fundamental compliance obligations
1. Enrol with AUSTRAC
Formally register your practice as a reporting entity.
2. Develop & Maintain an AML/CTF Program
Create a written, risk-based program tailored to your firm's specific ML/TF risks. This is the cornerstone of your compliance.
3. Conduct Customer Due Diligence (CDD)
Identify and verify your clients and their beneficial owners before providing a designated service, and monitor them on an ongoing basis.
4. Report to AUSTRAC
Submit Suspicious Matter Reports (SMRs) and Threshold Transaction Reports (TTRs) as required.
5. Keep Records
Maintain all relevant records of CDD, transactions and your AML/CTF program for prescribed periods.
6. Appoint an AML/CTF Compliance Officer
Designate a senior individual responsible for the oversight of your program.
Key AML/CTF Areas for Real Estate Professionals
Under Tranche 2, real estate professionals face new obligations when facilitating property transactions. Our documentation helps you navigate these requirements with confidence.
Vendor & Purchaser Verification
Procedures for verifying the identity of all parties to property transactions.
Trust Account Controls
AML/CTF controls for trust accounts, including monitoring, transaction verification and suspicious activity detection.
Beneficial Ownership Identification
Requirements for identifying beneficial owners when dealing with companies, trusts or other entities.
Source of Funds Enquiries
Procedures for understanding and documenting the source of funds for property purchases.
High-Risk Transaction Protocols
Enhanced due diligence for high-value properties, foreign buyers and complex transactions.
Suspicious Matter Reporting
Workflows for identifying, escalating and reporting suspicious matters to AUSTRAC.
Compliance Officer Duties
Appointment requirements, role description and ongoing responsibilities for AML/CTF compliance.
Building an AML Program
Building an AML/CTF program for a real estate agency requires multiple steps.
- AML/CTF program framework for real estate agencies
- Risk assessment worksheet (ML/TF/PF risks)
- Vendor and purchaser verification procedures
- Trust account AML controls and monitoring
- Source of funds enquiry workflows
- Suspicious matter reporting procedures
- Staff Training Register for tracking completion
- Compliance officer role description
Ready to Get Started?
We can help you get a headstart on your AML/CTF program. Program packs from $249, licensed to you permanently. Portal is free with managed CDD, or run your own CDD on BYO-API plans from $20/month.
A HeadStart on Compliance
Sector-specific compliance documents to help you build your AML/CTF program.
Ready-to-Customise Resources
Lawyer-ready to review for your business.
Training & Record-Keeping
Staff Training Register, Compliance Officer appointment documents and portal-based training record-keeping.
From $249 inc GST · or bring your own program
HeadStart Docs™ products are developed with reference to publicly available regulatory guidance. This is general information only and does not constitute legal or professional advice. You should seek advice specific to your circumstances before making compliance decisions.