AML/CTF Reforms for Real Estate
Overview
New anti-money laundering and counter-terrorism compliance measures are being introduced for real estate professionals. These changes intend to prevent money laundering and other fraudulent activity for ‘designated services’. The real estate sector has been identified as a 'designated service' due to the significant risk of money laundering or concealing illicit funds through property transactions.
The reforms apply to real estate professionals who sell or buy residential, commercial, industrial, and agricultural property and land. Property management and commercial leasing are exempt. Real estate professionals will be required to monitor, record, and report suspicious activity using rules and mechanisms provided by the federal government.
Compliance for real estate professionals will take effect in July 2026, with the governing rules and core guidance to be finalised and released in the coming months. The REIV is engaged with the federal government and industry to provide training and education for real estate professionals.
Upcoming events
Feeling unsure about the new AML/CTF policies? AMLHub’s free webinar will help you prepare. Choose one of the two sessions.
- What's on this page
Overview
What You Need to Know
Understanding the reforms
REIV Advocacy
Resources
Key Dates
- Key Dates
August 2025: Finalisation of AML/CTF Rules
October 2025: Finalisation of core guidance
December 2025: Finalisation of real estate sector-specific guidance
1 July 2026: AML/CTF obligations commence for real estate professionals
One of the biggest changes to real estate is coming soon
Property transactions have been identified as high-risk services due to the increased opportunity for exploitation through money laundering in the real estate sector. It has not been implied that real estate professionals are actively seeking out or facilitating opportunities for money laundering.
Under the AMLCTF legislation, real estate professionals will be required to verify client identities, assess transaction risks, and report suspicious activities to AUSTRAC. Real estate agencies will need to implement ongoing monitoring, maintain records, and establish an internal compliance program that includes staff training and the appointment of a compliance officer.
Understanding the Reforms
Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) laws are designed to prevent criminals from using the financial system to hide illicit funds or finance terrorism. These laws require businesses to identify, manage, and report suspicious activity related to large financial transactions. While banks and financial institutions have long been regulated under these laws, the real estate sector is increasingly recognised as a vulnerable point for money laundering due to the high-value nature of property transactions.
Real estate is an attractive avenue for money laundering because it allows criminals to move large sums of money through seemingly legitimate purchases. Buying and selling property can help disguise the origins of illegal funds, making it harder for authorities to trace. As a result, the federal government is tightening regulations, and real estate professionals will be required to play a more active role in detecting and reporting suspicious activity, such as unusual payment methods or transactions that trigger red flags.
The AML/CTF regime helps businesses identify risks and prevent or disrupt criminal activities. It also provides law enforcement with valuable intelligence in the fight against serious and organised crime, helping to protect the Australian community and businesses from serious harm. In Australia, real estate professionals are not yet formally regulated under the AML/CTF Act. However, legislation passed in November 2024 introduces new compliance obligations for real estate professionals, set to commence in July 2026. Typical obligations under AML/CTF legislation include identity checks, due diligence, and reporting obligations to help reduce financial crime in the real estate sector.
REIV Advocacy
In its submission to AUSTRAC, the REIV provided the following feedback to the government:
Primary Recommendations
1. Know Your Customer (KYC) obligations would be most effective at the point of settlement. The REIV recommends a review of the delayed due diligence rules to enact KYC obligations at the point of settlement. This would ensure that the final buyer is identified accurately and that AML/CTF obligations are met at a pragmatic juncture.
2. Reliance rules should be expanded to allow real estate agents to unconditionally rely on legal representatives and financial institutions. The REIV recommends a review of the reliance rules to ensure real estate agents can refer to them to meet their AML/CTF obligations. This includes unconditional certainty of relying on reliance rules following verification by legal representatives and financial institutions.
Secondary recommendations
1. Expand the role of key authorities already embedded in the real estate transfer process. Real estate transactions involve key government authorities, including SERV and the State Revenue Office, as well as large-scale organisations such as PEXA. Consider expanding their roles to fulfil AML/CTF obligations and compliance measures.
2. Established government technologies, including MyGov, can play an integral role. Existing federal government technology that interacts with the national security infrastructure, including the MyGov application, should be utilised as a component of the VOI process.
3. AUSTRAC must provide definitive and realistic guidelines for its monitoring and compliance framework. AUSTRAC must provide definitive and realistic guidelines for compliance measures. It needs to consider the prevalence of scenarios that may trigger compliance measures when there is no likelihood of fraudulent behaviour.
Resources
Attorney-General’s Department – Anti-Money Laundering and Counter-Terrorism Financial Amendment Bill
The Anti-Money Laundering and Counter-Terrorism Financial Amendment Bill outlines all changes introduced and passed by the Parliament of Australia in November 2024. These include the reforms that introduced compliance obligations and mechanisms for real estate professionals. The bill does not contain the rules governing the real estate sector’s obligations, as these are being finalised through 2025.
AUSTRAC’s AML/CTF page contains all relevant information and updates on reforms, including which industries are regulated, public consultation on rules, risks and indicators of suspicious activity, and legislative progress.
AUSTRAC – Money Laundering Australia National Risk Assessment report
AUSTRAC’s National Risk Assessment brings together insights from across Australia’s law enforcement, intelligence and regulatory agencies, private sector stakeholders and international financial intelligence units (FIUs) to assess risks associated with money laundering.
Parliament of Australia – AML/CTF Bill – Report (November 2024)
The AML/CTF report, compiled and provided by a non-partisan committee, covers the bill's purpose. It contains eight recommendations to improve the bill’s design and implementation.
AUSTRAC – e-Learning materials
AUSTRAC’s e-learning materials provide accessible education resources for reporting entities to increase their knowledge of AML/CTF compliance. Real estate professionals do not require a login to access e-Learning materials.