AML/CTF in Real Estate

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Anti-Money Laundering and Counter-Terrorism Financing — explained simply for buyers and sellers.

AML/CTF stands for Anti-Money Laundering and Counter-Terrorism Financing.

In simple terms, these laws are designed to make it harder for criminals to use legitimate businesses — including real estate — to move, hide or disguise money connected with serious crime.

A new part of buying and selling property in Australia

If you’re buying or selling real estate, you may now be asked to confirm your identity and answer a few questions that you haven’t previously been asked by a real estate agent.

There is a simple reason for this.

From 1 July 2026, Australian anti-money laundering and counter-terrorism financing laws were extended to real estate professionals. Real estate agents now have legal obligations to know who they are dealing with and, where appropriate, understand more about a property transaction.

This process is called Customer Due Diligence, or CDD.

For most people involved in an ordinary property transaction, it should be straightforward.

Being asked to complete AML/CTF checks does not mean that anyone suspects you of doing anything wrong.

It is now simply part of the regulatory framework applying to Australian real estate.

Why has this changed?

Property is valuable, can hold or increase its value over time, and can be bought, sold and transferred in many different ways. For those same reasons, real estate can also be attractive to people seeking to disguise or move the proceeds of crime.

Australia’s AML/CTF laws are designed to make it harder for the financial system — including the property market — to be misused for money laundering, terrorism financing and other serious financial crime.

Banks and many financial institutions have carried out “know your customer” checks for years. Real estate professionals are now part of that framework too.

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What will I actually need to do?

For most individuals, the process starts with some basic information about who you are and the transaction.

You may be asked for information such as:

• your full name
• date of birth
• residential address
• country of residence
• your occupation
• whether you are acting for yourself or somebody else
• how you intend to fund a purchase
• whether a company, trust or other legal structure is involved.

We will also need to establish that you are who you say you are.

Often this can be done using photographic identification such as a driver’s licence or passport. Other verification methods may also be available depending on the circumstances.

In simple terms

1. We collect some basic information.
2. We verify your identity.
3. We understand who is really involved in the transaction.
4. We undertake the checks required under our AML/CTF obligations.
5. In some circumstances, we may need to ask a few more questions.

For the vast majority of straightforward transactions, that should be the extent of the experience.

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If you’re selling a property

When a real estate agent is appointed to broker the sale of a property, the seller becomes a customer for AML/CTF purposes.

That means identity and customer due diligence will generally form part of the seller onboarding process.

This needs to happen because an agent has AML/CTF obligations from the point at which they commence providing the regulated real estate service.

So if we’re asking you for identification before we get properly underway with the sale, it isn’t unnecessary paperwork or simply a new JtA.RealEstate policy.

It is part of the regulatory environment in which Australian real estate agents now operate.

If you’re buying a property

This is where the new rules can initially seem a little strange.

You might be buying a property through an agent who represents the seller, not you.

But for AML/CTF purposes, both the seller and the buyer are treated as customers of the real estate agent brokering the transaction.

That means the selling agent may need to complete customer due diligence on you as the successful buyer.

That does not mean the selling agent represents you.

Your legal relationship with the agent has not changed. This is simply how the AML/CTF framework applies to the real estate transaction.

For a seller’s agent, the designated service to the buyer starts when it is reasonably expected that the transaction will proceed. AUSTRAC says this is typically when the buyer’s offer has been accepted and the contract to buy or transfer the property is signed.

So don’t be surprised if an agent asks you to complete an identity or AML/CTF process around contract time.

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Why are you asking how I’m paying for the property?

This is another question that can sound more intrusive than it really is.

As part of customer due diligence, a real estate professional may need to understand how a property purchase will be funded — for example, whether it involves a home loan, savings, the sale of another property or another source.

In a straightforward transaction, telling us something such as:

“We’re using an 80% home loan and our savings for the balance.”

may be all that is required.

This is different from being asked to provide detailed evidence about your source of funds or source of wealth.

Will I have to prove where all my money came from?

Not necessarily.

AML/CTF is a risk-based system.

Depending on the circumstances, additional information may be required. This can include establishing the source of funds being used for a transaction or, in some cases, a person’s broader source of wealth.

Source of funds

This means how the money for this particular transaction was originally obtained.

Examples might include:

• savings from employment
• business income
• the sale of another property
• investments
• an inheritance
• a gift.

It does not simply mean identifying the bank account from which the money will be transferred.

Source of wealth

This is broader. It looks at how a person accumulated their overall wealth over time.

Additional evidence is more likely to be requested where the circumstances of a customer or transaction require enhanced due diligence.

So receiving a request for more information should not automatically be interpreted as an accusation or suggestion of wrongdoing.

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What if I’m buying or selling through a company or trust?

The process can be a little more involved.

Where a company, partnership, trust or other legal structure is involved, the agent may need to establish not only that the entity exists, but also who ultimately owns, controls or benefits from it.

For a company, this can include identifying its beneficial owners — the real people who ultimately own or control the entity.

For a trust, information may be required about trustees and other people who own, control or benefit from the structure, depending on the particular trust.

That can make the process look considerably more complicated than it does for an individual buying or selling in their own name.

It isn’t the agent being difficult. Different customer structures require different levels of due diligence.

Why are you asking whether I’m a politically exposed person?

You may see a question asking whether you — or in some circumstances someone connected with you — are a Politically Exposed Person, usually shortened to PEP.

A PEP is generally someone who holds, or has held, a prominent public position, as well as certain family members and close associates.

Being a PEP does not mean that someone has done anything wrong.

It is simply one of the factors AML/CTF legislation requires regulated businesses to identify and take into account.

You may also be screened against applicable financial sanctions.

Again, these are compliance checks — not accusations.

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Why might you come back and ask me another question?

Customer due diligence isn’t always a single tick-the-box exercise.

Sometimes information doesn’t match. Sometimes the ownership structure is more complicated than first understood. Sometimes the way a transaction is being funded requires clarification.

In those circumstances we may need to ask for further information or documentation.

So if we come back with another question, please don’t automatically read anything more into it.

Often, we’re simply completing the process we’re legally required to complete.

What happens to my personal information?

AML/CTF inevitably involves personal information, and we appreciate that people are rightly careful about where their identification and financial information goes.

Information collected through the AML/CTF process must be handled in accordance with the applicable privacy and information-handling requirements.

We aim to make the process proportionate: collecting and verifying the information we need to meet our obligations without turning a straightforward property transaction into an unnecessarily complicated experience.

Can an agent refuse to proceed if I don’t complete the checks?

Potentially, yes.

Real estate agents have legal obligations to undertake customer due diligence in accordance with the AML/CTF framework.

There can therefore be circumstances where an agent is unable to commence or continue providing a regulated service until the required checks have been completed.

So while we will always try to make the process as simple as possible, an agent cannot simply ignore the requirements.

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Why might another agent ask me different questions?

AML/CTF is risk based.

Every regulated real estate business must have an AML/CTF program appropriate to its business and the risks it encounters.

That means two agencies may not always have identical onboarding processes.

One transaction may also require more information than another.

The important distinction is between unnecessary bureaucracy and additional information that is genuinely required because of the customer, transaction or circumstances.

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A note for real estate professionals

If you’re another real estate professional reading this because you’re trying to make sense of the new regime, you’re certainly not alone.

One of the most important — and perhaps least intuitive — features of the new real estate rules is this:

When an agent brokers a sale, both the seller and the buyer are customers of that reporting entity for AML/CTF purposes.

For a seller’s agent:

• the AML/CTF service to the seller generally begins as the agent commences providing the regulated real estate service
• the buyer is also a customer of the reporting entity for AML/CTF purposes
• for the buyer, the designated service starts when it is reasonably expected that the transaction will proceed — typically when the buyer’s offer has been accepted and the contract is signed
• different timing rules and exceptions can apply in particular circumstances.

The legislation and regulatory guidance can become technical very quickly.

The underlying idea is considerably simpler:

Know who you are dealing with. Understand the transaction. Identify circumstances requiring greater scrutiny. Keep appropriate records. And respond when something doesn’t make sense.

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The important thing to remember

Buying or selling property is already a significant process. AML/CTF should not make it unnecessarily intimidating.

If we ask you for identification or information about your transaction, it isn’t because we’ve singled you out.

It is part of the legal framework real estate professionals now work within.

We’ll explain what we need, why we need it and help make the process as straightforward as we reasonably can.

Questions? Ask us.

We would much rather explain why something is required than leave you wondering why you’re being asked.

Want to go deeper?

AUSTRAC publishes detailed guidance about AML/CTF requirements for Australian real estate, including information about customer due diligence and the obligations applying to real estate professionals.

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This page provides general information about AML/CTF requirements in Australian real estate. It is intended to help buyers, sellers and real estate professionals understand the process in plain English and is not legal advice.