How the New AML-CTF Tranche 2 Regime Will Affect Property Market Participants
From 1 July 2026, Australia’s anti-money laundering and counter-terrorism financing (AML-CTF) regime is expanding under the AML/CTF Amendment Act 2024 and associated rules. This expansion known as Tranche 2,brings a wide range of property market participants into the regulatory net, with practical implications that will reshape compliance and daily practice across the sector.
Who Is Now Caught by the Regime?
Under Tranche 2, a number of roles that were previously outside the AML regime will become reporting entities if they provide designated services with an Australian link. In practice, this includes real estate agents and buyer’s agents, property developers, conveyancers, lawyers handling property transactions, accountants advising in this space, and trust and company service providers.
New Practical Obligations
If you are captured by the regime, you will face several important new duties:
- Enrolment with AUSTRAC: Businesses must enrol as AML-CTF reporting entities before providing designated services. This involves submitting organisational details and keeping them up to date.
- Develop and Maintain an AML-CTF Program: You must implement a documented risk-based compliance program that includes written policies, procedures, ongoing risk assessments, and controls tailored to your business.
- Customer Due Diligence (CDD): Before acting for a buyer, seller, or other party, you must identify and verify their identity, beneficial ownership and, for higher-risk matters, consider source of funds and source of wealth. Ongoing monitoring of relationships is also required.
- Suspicious Matter Reporting: If a transaction or client behaviour raises reasonable suspicion of money laundering or terrorism financing, entities must report this to AUSTRAC.
- Record-Keeping: Detailed records of identity checks, risk assessments, policies, training and reports must be retained (typically for seven years).
How It Looks in Everyday Practice
For property professionals and lawyers, this means that interactions that were once largely administrative will now involve compliance steps more akin to those seen in financial services: systematic identity verification, risk profiling of clients and funds, documenting compliance decisions, and regular staff training. Agents and conveyancers can expect earlier ID checks at the point of client onboarding, more detailed questions around payment sources in high-value transactions, and structured processes to flag and report anomalies.
Why These Changes Matter
The reforms aim to close gaps in Australia’s AML-CTF framework by regulating sectors historically used by criminals to launder the proceeds of crime through high-value assets like property. They also bring Australian law more into alignment with international standards
Preparing for the Transition
While the formal obligations only commence in July 2026, affected businesses are already encouraged to start preparing. This includes appointing compliance leads, mapping out when and how client checks will occur in existing workflows, drafting AML-CTF policies, and training staff ahead of the compliance start date.
