{"id":4872,"date":"2025-08-26T15:19:01","date_gmt":"2025-08-26T05:19:01","guid":{"rendered":"https:\/\/theonsitemanager.com.au\/news\/?p=4872"},"modified":"2025-08-26T15:19:02","modified_gmt":"2025-08-26T05:19:02","slug":"real-estates-new-reality-aml-ctf-overhaul-fresh-funding-and-what-it-means-for-agents","status":"publish","type":"post","link":"https:\/\/www.theonsitemanager.com.au\/news\/real-estates-new-reality-aml-ctf-overhaul-fresh-funding-and-what-it-means-for-agents\/","title":{"rendered":"Real estate\u2019s new reality: AML\/CTF overhaul, fresh funding and what it means for agents"},"content":{"rendered":"\n

Brisbane, 26 August 2025 \u2014<\/strong> Australia\u2019s real estate sector is hurtling toward its biggest compliance shake-up in decades, with the federal government confirming that anti-money laundering and counter-terrorism financing (AML\/CTF)<\/strong> obligations will extend to real estate professionals from 1 July 2026<\/strong>. The reforms\u2014passed by Parliament in late 2024 and now being implemented by AUSTRAC\u2014will require agencies to enrol with the regulator, build risk-based compliance programs, verify clients, file suspicious matter reports, and keep detailed records. (AUSTRAC<\/a>)<\/p>\n\n\n\n

Under AUSTRAC\u2019s published timetable, enrolment for newly regulated businesses opens on 31 March 2026<\/strong>, giving agencies a short runway to formalise systems before the legal start date. AUSTRAC has also flagged \u201ccore guidance\u201d for new entrants in October 2025<\/strong>, aimed at demystifying obligations, programs and reporting. (AUSTRAC<\/a>)<\/p>\n\n\n\n

What changes on the ground<\/h3>\n\n\n\n

For real estate professionals\u2014defined by AUSTRAC to include real estate agents, buyers\u2019 agents and property developers<\/strong>\u2014the key new obligations are clear: (1) enrol with AUSTRAC, (2) implement and maintain an AML\/CTF program tailored to your business, (3) conduct initial and ongoing customer due diligence, (4) report certain transactions and suspicious activity, and (5) keep prescribed records for at least seven years<\/strong>. Those obligations are risk-based, meaning procedures should scale to the size, services and risk profile of each agency. (AUSTRAC<\/a>)<\/p>\n\n\n\n

The reforms are part of a broader modernisation push that saw the AML\/CTF Amendment Bill 2024<\/strong> pass both houses on 29 November 2024, receiving Royal Assent on 10 December 2024. Government agencies have since been rolling out guidance, exposure drafts of updated Rules and staged industry consultations to smooth the transition for so-called \u201ctranche 2\u201d entities, which include real estate alongside lawyers, accountants, conveyancers and others. (AUSTRAC<\/a>)<\/p>\n\n\n\n

Who pays for the uplift?<\/h3>\n\n\n\n

To help fund the reform and enforcement effort, the 2024-25 Federal Budget<\/strong> earmarked $167.8 million<\/strong> to support implementation of the AML\/CTF overhaul and strengthen Australia\u2019s defences against financial crime. While that is central funding, AUSTRAC also operates an industry contribution levy<\/strong> on some reporting entities to recover a portion of its operating costs. Crucially for smaller agencies, AUSTRAC says the levy \u201cusually\u201d applies only to medium and large businesses<\/strong>\u2014typically those with earnings of A$100 million or more<\/strong> or very high reporting volumes. (Grant Thornton Australia<\/a>, AUSTRAC<\/a>)<\/p>\n\n\n\n

In other words, the day-to-day cost of getting compliant\u2014drafting programs, conducting KYC, training staff, and potentially investing in regtech\u2014will sit with agencies, but most small and mid-sized firms are unlikely to receive an AUSTRAC levy invoice based on current settings.<\/p>\n\n\n\n

Industry reaction: support, with warnings on red tape<\/h3>\n\n\n\n

The Real Estate Institute of Queensland (REIQ)<\/strong> says it backs the objectives of stronger safeguards but wants a practical, proportionate regime<\/strong> that recognises the sector\u2019s structure.<\/p>\n\n\n\n

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\u201cWe fully support the Government\u2019s commitment to protecting the integrity of the Australian financial system,\u201d REIQ CEO Antonia Mercorella<\/strong> said. \u201cHowever, the proposed framework doesn\u2019t fully take into account the practical challenges faced by real estate businesses\u2014namely the lack of resources and specialised expertise needed to meet these complex compliance requirements.\u201d (REIQ<\/a>)<\/p>\n<\/blockquote>\n\n\n\n

Ms Mercorella noted most Queensland agencies are small, independent operations<\/strong> and warned that compliance costs are unlikely to be absorbed<\/strong> without flowing through to consumer prices. She advocated a more collaborative, technology-enabled model<\/strong> that lets \u201ctranche 2\u201d professionals share verified information, with VOI and frontline monitoring<\/strong> handled by agents while complex tasks like source-of-funds\/wealth checks and PEP identification<\/strong> sit with legal and accounting specialists. (REIQ<\/a>)<\/p>\n\n\n\n

On the accommodation side of the property industry, the Australian Resident Accommodation Managers Association (ARAMA)<\/strong> has highlighted the pace of legislative change as a standing pressure point for resident managers. As ARAMA put it in a 2024 note to members: \u201cARAMA exists to represent the industry in a way that our members can\u2019t.\u201d<\/strong> The association added: \u201cThere has been a lot of reform in the last few years and we have spent a lot of time working on new laws to safeguard MLR businesses.\u201d<\/strong> While not an AML-specific statement, it captures the stakeholder fatigue many operators feel as overlapping state and federal changes roll through. (Arama<\/a>)<\/p>\n\n\n\n

One important nuance from the federal consultations: property management and leasing were removed from the scope<\/strong> of proposed AML regulation during 2024, a shift welcomed by the Property Council because those transactions were seen as high-volume, lower-risk<\/strong> compared with sales. That tweak, if maintained in the final Rules for tranche 2, narrows the immediate impact on managers while keeping the focus on sale and purchase risks. (Property Council Australia<\/a>)<\/p>\n\n\n\n

Timeline at a glance<\/h3>\n\n\n\n