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Real Estate Obligations

What an agency actually has to do under AUSTRAC Tranche 2

The AUSTRAC reforms are written for every Tranche 2 industry at once. This page translates them into the things a real estate agency does day to day — who is responsible, when checks happen in a sale, and what to keep on file.

Is your agency a reporting entity?

From 1 July 2026, an agency becomes a reporting entity the first time it provides a designated service. For real estate, the designated services are brokering the sale, purchase or transfer of real estate — whether you act for the seller or the buyer.(Source: AUSTRAC, “Real estate services (Reform)”, retrieved 23 May 2026)

Two points trip up principals most often:

  • Structure does not matter. Sole traders, partnerships, companies and franchise branches are all captured. Being part of a franchise network does not transfer the obligation — each reporting entity is responsible for its own program.
  • Buyer’s agents are in scope. Acting for a purchaser to broker a purchase is a designated service in its own right.
  • Standard property management is generally not a designated service. Managing an existing rental tenancy — collecting rent, arranging repairs — is not listed. But the same business is captured for any sale or transfer work it also does.

Who in the agency is responsible?

Compliance is not one person’s job, but the Act does require named accountability. In a typical independent agency it breaks down like this:

  1. Role 01
    The reporting entity

    The business itself holds the legal obligations. If you operate under one ABN, that entity must enrol, hold a program, and lodge reports.

  2. Role 02
    AML/CTF Compliance Officer

    Every reporting entity must designate one. For most independents this is the principal or licensee in charge — not a new full-time hire. They own the program and are AUSTRAC’s point of contact.

  3. Role 03
    Sales agents & staff

    Anyone who deals with buyers and sellers needs to know how to identify a customer, spot a red flag, and escalate a concern — without tipping off the customer.

Your obligations, in plain terms

Tranche 2 sets the same core obligations for every regulated business. Here is what each one means for an agency:

  1. Obligation 01
    Enrol with AUSTRAC

    Register the business through AUSTRAC Online. Enrolment is free and must be completed within 28 days of first providing a designated service. You can enrol early to avoid the post-deadline queue.

  2. Obligation 02
    Hold an AML/CTF program

    A written program built on a money-laundering and terrorism-financing risk assessment of your agency — your services, customers, channels and locations. It must set out your controls, governance, training and your named Compliance Officer.

  3. Obligation 03
    Customer due diligence

    Identify and verify your customers and any beneficial owners before you provide the designated service. Apply enhanced due diligence for higher-risk customers such as politically exposed persons (PEPs), trusts and companies.

  4. Obligation 04
    Monitor & report

    Keep an eye on transactions and behaviour. Lodge a Suspicious Matter Report when you form a suspicion, and a Threshold Transaction Report for physical cash of A$10,000 or more. Never tip off the customer.

  5. Obligation 05
    Keep records (7 years)

    Retain customer identification, your risk assessment, screening results and reporting decisions for at least 7 years, retrievable on AUSTRAC’s request.

  6. Obligation 06
    Train your team

    Give staff role-appropriate AML/CTF training so they can apply your program — recognise red flags, complete CDD, and follow the tipping-off rules.

(Source: AUSTRAC, “Summary of AML/CTF obligations for tranche 2 entities”, retrieved 23 May 2026)

When checks happen in a sale

Customer due diligence must be done before you provide the designated service. Mapping it onto a typical residential sale, the practical points are:

  1. Listing
    Identify the seller
    When you take a listing you are providing a designated service to the vendor. Identify and verify the seller — and if the seller is a company or trust, the beneficial owners behind it.
  2. Offer & negotiation
    Identify the buyer
    Before brokering the purchase, identify and verify the buyer. This is the natural moment to screen for PEP and sanctions matches and to ask how the purchase is being funded.
  3. Contract
    Resolve higher-risk cases
    Trust, SMSF and company buyers, overseas purchasers and unusual funding all trigger enhanced due diligence. Complete it before you rely on the customer relationship.
  4. Ongoing
    Monitor & report
    Stay alert for changes or red flags through to settlement. If a suspicion forms at any point, lodge an SMR — and do not tell the customer.

Higher-risk situations to watch

Most transactions are low risk. A handful are not, and these are the ones that need enhanced customer due diligence:

  • Trusts, SMSFs and companies. You must identify the beneficial owners — broadly, anyone who owns or controls 25% or more — and understand the structure.
  • Politically exposed persons (PEPs). A PEP is not someone you refuse. You apply enhanced checks and document source of funds. See our PEP & sanctions explainer.
  • Overseas and migration-linked buyers. Funds flowing from higher-risk jurisdictions warrant closer attention to source of funds and identity verification.
  • Unusual funding. Large cash, third-party payers, or rushed settlements with no clear commercial reason are classic red flags.

Agency readiness checklist

Tick what you already have. Any blank box is a task for before 1 July 2026.

One platform for every obligation above

AMLHive gives an independent agency guided onboarding, CDD checklists, one-click PEP and sanctions screening, an AML/CTF program wizard, and an audit trail that records every check — without a compliance team.

Start free until 30 June 2026Read the AUSTRAC guide

Frequently asked questions

Does our franchisor handle this for the whole network?

No. The AML/CTF Act attaches obligations to the reporting entity that provides the designated service — your individual business. A network may give you a template or shared tools, but it cannot take on your legal responsibility. Each branch must enrol and hold its own program.

Do property managers need to do CDD?

Standard management of an existing rental tenancy is not a designated service, so CDD is not triggered by it. If the same business also brokers sales or transfers, those activities are captured and require CDD.

Can our conveyancer do the customer checks?

The reforms allow limited reliance on another reporting entity in defined circumstances, but you remain legally responsible for your own obligations. Document any reliance arrangement and confirm the other party is a regulated entity.

How much will the Compliance Officer role cost?

For most independents, nothing extra — the role is usually held by the principal. It is an accountability role, not a mandatory new hire. See our blog post, the Compliance Officer myth.

Sources & further reading

Disclaimer: This guide is general information only and is not legal, financial or compliance advice. AMLHive is not affiliated with AUSTRAC or the Australian Government. You should obtain independent professional advice for your specific circumstances. Always check the current AUSTRAC guidance and the AML/CTF Act and Rules before relying on the information above.