AML/CTF Tranche 2: what Australian real estate agents must do now

The short answer

From 1 July 2026, Australian real estate agents are reporting entities under the Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) Act, through the AML/CTF Amendment Act 2024, known as Tranche 2. The regulator is AUSTRAC. This is the first time real estate agents have been captured, and the obligations are now in effect. If you list, sell or help transfer property, you need to enrol with AUSTRAC, stand up an AML/CTF program, and verify who your customers are before you act for them. This guide reflects AUSTRAC guidance as at July 2026.

This is general information, not legal or compliance advice. The official source of truth is AUSTRAC. Rely on AUSTRAC guidance and obtain your own professional or legal advice for your business.

What Tranche 2 is, in plain terms

For years, banks and other financial businesses have carried AML/CTF obligations. Tranche 2 extends the same regime to a new set of professions. Alongside real estate agents, it captures lawyers, conveyancers, accountants, and dealers in precious metals and stones. The change came through the AML/CTF Amendment Act 2024, and 1 July 2026 is the commencement date.

The idea behind it is straightforward. Property is a large, high-value market, and that makes it attractive to people trying to move or hide money. As the agent who brokers the deal, you sit at a point where you can see who is buying, who is selling, and how the money is moving. Tranche 2 asks you to take reasonable steps to know your customers and to report certain things to AUSTRAC. It does not turn you into an investigator, and it is not designed to. It sets a baseline of checks and record-keeping that every captured business is expected to meet.

Which services are captured, and which are not

The captured activity is any service you provide in connection with the sale, purchase or transfer of real estate. This applies regardless of the price, and it applies whether you act for the vendor or the purchaser. There is no dollar threshold below which a sale falls outside the regime.

Real estate here means an interest in land in Australia. That includes a fee simple interest, which is ordinary ownership, a leasehold interest of more than 30 years, excluding options to renew or extend, and a land use entitlement.

Some things are clearly outside the new obligations. Residential property management is not captured. Leasing or renting under leases of 30 years or less is not captured. Valuers and mortgage brokers are not listed as providers of the real estate designated services commencing 1 July 2026. So the simple way to hold it in your head is this: selling and buying are in, property management and ordinary leasing are out.

For most sales agents, that means your listing and sale work is captured, while the rent roll side of the business is not. If you run both, you will need to be clear internally about where the line sits, because the compliance work attaches to the sales activity.

Both the vendor and the purchaser are your customer

This is the point that catches people out, so it is worth being direct about it. Where you broker a sale, both the purchaser and the vendor are customers of the same reporting entity. You have AML/CTF obligations to both parties.

In day-to-day terms, you cannot only check the person who signed your agency agreement. When a purchaser comes forward and the deal proceeds, they become your customer too for the purposes of this regime. Your due diligence process needs to account for both sides of the transaction, not just the side that is paying your commission.

Your core obligations

Tranche 2 brings a set of obligations that work together. None of them is exotic on its own. The work is in setting them up properly and running them consistently.

Enrol and register with AUSTRAC

You must enrol with AUSTRAC, and enrolment includes registering the designated services your business provides. This is the front door of the whole regime. There is a firm deadline, covered below.

Develop and maintain an AML/CTF program

Your program is your risk assessment together with your policies, procedures and controls. In practice this is a written document, or a set of them, that describes the money-laundering and terrorism-financing risks your business faces and the steps you take to manage them. It is not a one-off. You maintain it over time as your business and its risks change.

Customer due diligence

Customer due diligence, or CDD, is the heart of the day-to-day work. It means you know and verify who your customer is before you provide a designated service. It includes:

• Initial CDD, identifying and verifying the customer up front.
• A customer risk rating, so you can treat higher-risk customers differently.
• Enhanced CDD for higher-risk customers, meaning extra checks where the risk warrants it.
• Ongoing CDD, keeping your understanding current rather than treating verification as done once and forgotten.

There is a deeper walkthrough of this in our guide to customer due diligence for real estate agents in Australia, which covers what verifying a vendor and a purchaser looks like in practice.

PEP and sanctions screening

You need to screen customers for politically exposed persons, known as PEPs, and against targeted financial sanctions. A PEP is someone in a prominent public position, or connected to one, where extra care is expected. Sanctions screening checks your customer is not on a list you are prohibited from dealing with.

Source of funds and source of wealth

Where it is relevant to risk, you need to consider the source of funds and source of wealth behind a transaction. This is not a demand to audit every purchaser's finances. It is a prompt to ask sensible questions where the risk profile calls for it.

Reporting to AUSTRAC

Two reporting duties sit alongside the checks:

• Suspicious matter reports (SMRs), which you submit to AUSTRAC where you form a relevant suspicion.
• Threshold transaction reports (TTRs), which you submit for cash transactions of AUD 10,000 or more.

Record-keeping

You must keep records for 7 years. That covers the verification you did, the decisions you made, and the reports you submitted. Good records are also your best protection if AUSTRAC ever asks how you handled a matter.

The auction timing point

A fair question for agents is how CDD works at auction, where things move fast. The general rule is that initial CDD must be completed before you provide the designated service. AUSTRAC allows delaying initial CDD in limited cases where completing it first would disrupt the ordinary course of business. The example that fits real estate is the short window between the fall of the hammer at auction and signing the contract of sale.

Conditions apply to this flexibility, so treat it as a narrow allowance rather than a general licence to verify late. Build your process so that verification happens up front wherever you can, and lean on the timing flexibility only where the situation genuinely calls for it and the conditions are met.

The enrolment deadline

AUSTRAC opened enrolment on 31 March 2026. If your business is providing a designated service on or after 1 July 2026, you must enrol with AUSTRAC by 29 July 2026, which is within 28 days of commencement. If your business starts providing a designated service later than that, you must enrol within 28 days of first doing so.

This is the deadline that is nearest and most concrete, so it is worth handling first. Our step-by-step walkthrough of AUSTRAC enrolment for real estate agents under Tranche 2 covers what registering your designated services involves.

The penalty scale

It is worth being clear-eyed about why this matters. The AML/CTF Act carries significant civil penalties. For a body corporate, the exposure is up to 100,000 penalty units, in the order of 33 million dollars. For a person other than a body corporate, it is up to 20,000 penalty units, in the order of 6.6 million dollars. Per-contravention exposure applies, so breaches can stack. AUSTRAC has a track record of large enforcement outcomes in other sectors.

The point of raising this is not to alarm you. It is to make the case for doing the setup properly rather than treating it as a box-ticking exercise. A real program that you actually run is a far better position than a paper one that falls apart under scrutiny.

What to do now

Here is a practical order of work for a sales agent or agency getting ready.

• Confirm whether your services are captured. Sales, purchases and transfers are in. Pure property management is not. If you run both, be clear about where the line sits in your business.
• Enrol with AUSTRAC. The deadline is 29 July 2026 for businesses operating from 1 July 2026, and enrolment includes registering your designated services.
• Put an AML/CTF program in place. That means a risk assessment plus written policies, procedures and controls that you maintain over time.
• Set up a CDD process. Build a repeatable way to verify vendors and purchasers, including PEP and sanctions screening, so it happens on every deal rather than by memory.
• Understand your reporting and record-keeping triggers. Know when an SMR or a TTR is required, remember the TTR trigger is cash of AUD 10,000 or more, and keep your records for 7 years.

The official source of truth is AUSTRAC. Rely on AUSTRAC guidance and obtain your own professional or legal advice before you finalise how your business complies.

The time cost, and where you get it back

None of this is impossibly hard, but it is real work, and it lands on top of an already full week. Verifying two parties per deal, keeping a program current, screening, and holding seven years of records all take hours you were not spending before. That is the honest picture.

Which is exactly why the hours you protect elsewhere matter more now. If new compliance admin has to fit into your week, the follow-up and chasing that fills your calls and messages is a good place to buy time back. NeuraCall runs your prospecting follow-up and chasing for you, in your own name, so the hours you free up can go to the work only you can do, whether that is compliance you cannot delegate or the listings that pay the bills. If that is useful, you can book a time to talk it through.

Tranche 2 is a meaningful change, but it is a manageable one. Confirm what is captured, enrol before 29 July 2026, stand up a genuine program, and make your CDD a habit rather than an afterthought. Do the setup once, do it properly, and lean on AUSTRAC guidance and your own adviser as you go.