What Is The AML/CTF Reform? [2026]

The AML/CTF Reform is a change to Australia’s laws that help prevent money laundering and terrorism funding. These laws are managed by AUSTRAC.

From 1 July 2026, people working in real estate, including buyer’s agents, will also need to follow these rules.

This means they may need to check a client’s identity, ask a few questions about where the money is coming from, and report anything that seems unusual. These steps are already common in banks and other financial services.

What Is The New AML/CTF Reform (2026)?

Australia has laws to help stop money laundering and terrorism funding. These rules are set out in a law called the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 and are managed by AUSTRAC.

For many years, these rules mostly applied to banks, money transfer businesses, and casinos.

In 2024, the government updated the law. These changes are often called the “Tranche 2” reforms. They expand the rules to include more industries, including people working in real estate.

From 1 July 2026, these rules will apply to real estate agents, buyer’s agents, property developers, conveyancers, lawyers, and accountants. These groups are called “Tranche 2 entities.” They have been seen as higher risk for financial crime but were not previously covered by these rules.

These changes are also happening because Australia will be reviewed by an international group called the Financial Action Task Force in 2026. This group checks how well countries are following global standards. Australia has been told before that not having these industries included was a gap in its system.

Why Is Real Estate Being Brought Into the AML/CTF Regime?

Real estate is one of the most common ways criminals try to hide illegal money in Australia. AUSTRAC has said that buying and selling property carries a high risk for money laundering.

There are a few simple reasons for this:

• Property deals involve large amounts of money, so criminals can move a lot of money at once.
• It can be harder to see who really owns a property if it is bought through companies or overseas groups.
• Once someone owns a property, it can earn rent and look like normal, legal income.
• Using illegal money in property can push prices up, making it harder for honest buyers.
• Real estate professionals are often the first people criminals deal with when trying to move money.

Some criminal groups have also used properties to grow or store illegal drugs. Because of this, property is often linked to crime in investigations.

In the past, Australia’s laws had not fully kept up with how criminals were using real estate. The new “Tranche 2” reforms are meant to fix this and bring Australia in line with global standards.

Who Does the Reform Apply To?

From 1 July 2026, new rules will apply to certain businesses that provide services connected to Australia.

In real estate, this generally includes:

• Real estate agents who help people buy or sell property
• Buyer’s agents
• Property developers who sell directly to customers
• Conveyancers
• Lawyers who assist with property transactions
• Accountants involved in property-related finances

It is expected that around 80,000 to 90,000 businesses will be included under these new rules.

Some activities will not be included. For example, giving general advice about property, making simple referrals, short-term rental arrangements, and court-ordered property transfers are not covered.

Key Dates and Deadlines

Here is a simple timeline of the key dates:

31 March 2026
Businesses can begin enrolling under the new rules. Updated requirements also start for existing reporting entities, such as banks.

1 July 2026
The new rules begin for real estate professionals, lawyers, accountants, and jewellers.

29 July 2026
This is the final date for these businesses to complete their registration with AUSTRAC.

2029
Businesses will fully move to the new reporting forms for certain transactions and activities.

31 March 2031
Some temporary exemption rules will come to an end.

What Are the Core Obligations for Buyer’s Agents and Real Estate Professionals?

Enrolment With AUSTRAC

All businesses that offer certain services must sign up with AUSTRAC.

Sign-ups open on 31 March 2026, and the new rules start on 1 July 2026.

If a business provides these services without signing up first, it may face serious legal penalties.

Developing an AML/CTF Program

Every business covered by these rules must create and keep an AML/CTF program. This is a plan that helps them manage risks.

This program has two main parts:

• Risk assessment: understanding where the risks may come from, such as the type of clients, transactions, or locations the business deals with.
• Policy and procedures: the steps and systems the business uses to reduce those risks.

AUSTRAC has created a simple starter kit to help smaller businesses set this up.

Businesses should review their risk assessment at least every three years, or sooner if there are important changes or new risks.

The old system used two separate parts. The new system combines everything into one clearer and more practical plan, especially for smaller businesses.

Customer Due Diligence (CDD)

Customer Due Diligence (CDD) is one of the biggest changes for buyer’s agents and property professionals. It means businesses need to check who their clients are and understand any risks before helping them.

There are three levels of checks:

• Simplified Due Diligence (SDD): for clients who are seen as low risk
• Standard Due Diligence: the usual level, where a client’s identity is checked before any service begins
• Enhanced Due Diligence (EDD): for higher-risk situations, such as people in public roles, clients linked to high-risk countries, complex ownership setups, or unusual use of cash

In many cases, businesses will need to check a client’s identity right at the start, before moving forward. These checks should also continue over time, not just happen once.

The new approach focuses more on risk. Lower-risk clients may have simpler checks, while higher-risk clients are looked at more closely. Many businesses may also use digital tools or trusted third-party services to help with these checks.

Source of Funds

As part of these checks, clients may be asked where their money is coming from when buying a property.

This could include savings, money from selling another home, an inheritance, or a loan.

If a company or trust is involved, the agent may also need to understand who really owns or controls it, and who benefits from it.

Record Keeping

Businesses must keep clear records for at least seven years after they finish working with a client.

These records should include:

• How the client’s identity was checked and the result
• Risk assessments and important decisions made
• Details of transactions and related messages

From 31 March 2026, businesses should not keep full copies of identity documents like passports or driver’s licences. Instead, they only need to record key details, such as the person’s name, date of birth, address, document type and number, and whether the check was successful.

Suspicious Matter Reporting

If a business notices a transaction or behaviour that seems suspicious, like possible money laundering or terrorism funding, it must report it to AUSTRAC.

This is required by law and is not optional.

Staff Training

Businesses need to give regular training to their staff about AML/CTF rules.

This helps staff understand what they need to do and how to spot any changes or risks.

What Does This Mean for Buyers Working With a Buyer’s Agent?

For people buying property, these changes will likely be part of the normal process. When you first work with a buyer’s agent, you can expect:

• Earlier ID checks: you may be asked to show your ID at the very beginning, not just at the end
• Questions about your money: you may be asked where your funds come from, such as savings, a sale, or a loan
• Extra questions for companies or trusts: if buying this way, you may need to explain who owns or controls it
• More checks in some cases: if things are more complex, there may be a few extra steps

These steps are becoming a normal part of buying property in Australia. They do not mean there is a problem, they are simply rules that apply to everyone.

What Are the Suspicious Activity Indicators for Real Estate?

AUSTRAC has shared guidance to help real estate professionals spot possible signs of suspicious activity.

They should be careful with clients or transactions that involve:

• People who mainly deal in cash, which can make it easier to hide illegal money
• Buyers who may be acting for someone else but not saying who that person is
• Buyers who have not seen the property in person
• People in important public roles, especially if linked to higher-risk countries
• Use of overseas companies or complex setups without a clear reason
• Money coming from or going to places known for higher risk
• Requests to use unusual or unclear payment methods

These signs do not always mean something is wrong, but they may need a closer look.

AUSTRAC’s Regulatory Approach: What to Expect After 1 July 2026

AUSTRAC has said it does not expect businesses to get everything right straight away. For many, these rules are new, and it takes time to learn how to spot risks.

However, AUSTRAC does expect businesses to make a real and honest effort. After 1 July 2026, it will focus on businesses that are not trying to follow the rules, rather than those who are working to improve.

AUSTRAC will also provide support, including:

• Guidance made for the real estate industry
• A simple starter kit for smaller businesses
• Training and learning resources
• Clear timelines for what is expected

Overall, AUSTRAC cares most about whether businesses are genuinely reducing risk, not just ticking boxes.

Benefits of the Reform for Property Buyers

While these new rules mainly add extra steps for professionals, they can also help property buyers in a few ways:

• Fairer competition: less chance of illegal money pushing property prices higher
• Fewer surprises later: any issues are more likely to be found earlier, not at the final stage
• More confidence: Australia’s property market is brought in line with global standards
• Better transparency: it is clearer who is buying property and where the money is coming from

Conclusion

The AML/CTF Reform is one of the biggest rule changes the Australian real estate industry has seen in many years. From 1 July 2026, buyer’s agents, real estate agents, and other property professionals will follow similar rules to banks for the first time.

For buyers, this means a few more questions and identity checks at the start. It may feel like a small change, but it helps create a fairer and more open property market.

For buyer’s agents and other professionals, it means setting up clear systems, checking client details, keeping good records, and reporting anything unusual to AUSTRAC.

At Precision Property Buyer’s Agency, we are keeping up with these changes and helping our clients understand what to expect at each step. These rules are becoming a normal part of buying property in Australia, and we aim to make the process as smooth and simple as possible.

FAQ

When do the AML/CTF reforms start for real estate?

For real estate professionals, the new rules start on 1 July 2026.

They can begin signing up with AUSTRAC from 31 March 2026.

What information will I need to provide as a buyer?

You may be asked to show ID and explain where your money is coming from.

If you are buying through a company or trust, you may also need to say who really owns or controls it.

What is a Suspicious Matter Report (SMR)?

A Suspicious Matter Report is an official report that a real estate professional must send to AUSTRAC if they see behaviour or transactions that seem suspicious, such as possible money laundering or terrorism funding.

Will this make the property buying process slower?

Not significantly. For most buyers, showing ID and answering a few questions about their money is simple.

Doing this early, when you first get started, can help avoid delays later on.

How long do records need to be kept?

Businesses must keep records about their checks, transactions, and AML/CTF programs for at least seven years after they finish working with a client.

Where can I find more information?

You can find AUSTRAC’s official guidance on their website at austrac.gov.au/amlctf-reform.

This article is for general information purposes only and does not constitute legal or compliance advice. For advice specific to your circumstances, please consult a qualified AML compliance professional or legal practitioner.