How To Start a Real Estate Business in Australia: Legal Checklist

Thinking of opening your own real estate agency in Australia? It’s an exciting industry with room to specialise in sales, leasing and property management, or to build a brand that grows with you.

Success in real estate, however, takes more than market knowledge and great service. Because the sector is highly regulated, you’ll need the right licences, a solid business structure, compliant trust account practices, and clear contracts and policies from day one.

This guide walks you through how to start a real estate business in Australia, step by step. We’ll cover the essential legal requirements, documents to prepare and practical tips so you can launch confidently and stay compliant as you grow.

What Does a Real Estate Business Do?

Real estate businesses in Australia can operate in different ways, often under one brand. Common activities include:

• Selling or leasing residential and commercial properties
• Managing rental properties on behalf of landlords (property management)
• Acting as a buyer’s agent or vendor advocate
• Running property auctions (where permitted under your licence)
• Specialist services, such as project marketing or rural property sales

The exact legal setup you’ll need depends on the services you offer and the state or territory in which you operate. Licensing titles and rules differ across jurisdictions, so always check your local regulator’s requirements before you launch.

Step-By-Step: Set Up Your Real Estate Agency

1) Complete Training and Apply for the Right Licence

Before you transact in property for reward, you must hold the appropriate real estate authorisation in your state or territory. The terminology varies-some jurisdictions refer to an agent’s licence, assistant agent or registration certificate, and separate licences for a licensee-in-charge (principal). In most cases you’ll need to complete accredited training (for example, a Certificate IV in Real Estate Practice or higher for an agency principal) and meet any experience and fit-and-proper requirements.

Each person who performs regulated functions must be appropriately authorised, and an agency must have a responsible licensee to supervise the business.

2) Choose a Business Structure

Your structure affects risk, control, tax and investor readiness. Common options include:

• Sole trader: Low cost and simple, but no separation between you and the business (personal assets are exposed).
• Partnership: Shared control between partners; consider a written partnership agreement. Liability can still be personal.
• Company (Pty Ltd): A separate legal entity that offers limited liability and is a common choice for agencies planning to hire or scale.
• Trust: Sometimes used for tax or asset protection with a company as trustee; more complex to set up and run.

If you decide to incorporate, a company setup can put a professional structure around your operations and brand. You can handle incorporation yourself or get help with a streamlined Company Set Up.

Tip: This is general information only. Structure decisions have tax consequences-get accounting advice before you lock it in.

3) Register Your ABN and Business Name

Once you’ve settled on a structure, make sure you:

• Obtain an ABN (Australian Business Number) for invoicing and dealings with government. If you’re unsure what an ABN means for you, read about the advantages and disadvantages of having an ABN.
• Secure your business name so your brand is protected nationally with Business Name Registration.
• If you set up a company, ASIC will issue you an ACN and you may also put a Company Constitution in place.

4) Set Up Your Trust Account and Insurance

Handling client money is a core part of real estate work. Most states require agencies that receive rent, bonds, or deposits to hold a designated trust account and follow strict record-keeping and audit rules. In many jurisdictions you must notify your regulator of your trust account details and comply with the relevant standards, and audits are commonly required.

Professional indemnity insurance is usually mandatory (and prudent). Check your local regulator for minimum coverage levels and any other insurance requirements that apply to your authorisation.

5) Secure Your Premises (If Needed)

Some regulators require an appropriate registered business address or a physical office. If you lease premises, have your agreement properly reviewed so you understand rent, permitted use, make-good and renewal options-an early Commercial Lease Review can help you negotiate key terms.

6) Put Your Legal Documents and Policies in Place

Before you onboard landlords, sellers or tenants, make sure your client agreements, website terms, privacy notices, and internal policies are ready (more on the key documents below). This protects your cash flow, clarifies service scope and reduces disputes.

7) Hire and Engage Staff Compliantly

If you’re employing property managers, sales agents, administrators or receptionists, use a written Employment Contract aligned with the Fair Work Act and any applicable awards. Commission structures, KPIs, expense policies and confidentiality obligations should be clear from the outset.

8) Considering Buying an Agency or Joining a Franchise?

Buying an established rent roll or joining a franchise can be a faster way to market, but it changes your legal to‑do list. You’ll need careful due diligence on the business sale documents, leases, trust account history and employment liabilities, and a detailed review of any Franchise Agreement obligations (fees, territories, brand standards and exit rights).

Do You Need Any Licences or Registrations?

Most real estate startups will need a combination of the following (subject to your state or territory):

• Individual authorisation: An agent’s licence, assistant agent or registration certificate depending on your role and jurisdiction.
• Corporate or agency licence: Required if you operate via a company or partnership; your agency must have a responsible licensee.
• ABN and business name: Needed to operate and invoice under your brand.
• Trust account: Open and operate in line with your local property legislation and audit requirements (often with regulator notification).
• Professional indemnity insurance: Commonly compulsory for agencies and licensees.
• Local approvals: Check council rules for signage, parking and home‑based business rules if you meet clients at home.

Licensing terminology and processes differ across Australia, so always follow your state or territory regulator’s guidance. Keep copies of your licence conditions handy-they often prescribe how you advertise, disclose commissions and hold client funds.

What Laws Do You Need to Follow?

Australian Consumer Law (ACL)

Your advertising, fee disclosures and representations must comply with the ACL. Avoid misleading or deceptive conduct, be clear about inclusions/exclusions in your services, and set out how you handle complaints. For a refresher on the core prohibition against misleading conduct, see this overview of section 18 of the ACL.

Privacy and Data Protection

Agencies routinely collect personal information (IDs for tenancy applications, contact details, financial information). If your business is covered by the Privacy Act 1988 (Cth)-for example, because your annual turnover is above $3 million or you meet another specific criterion-you must comply with the Australian Privacy Principles and have a clear, up‑to‑date Privacy Policy.

Even if you’re a small business that falls under the general small business exemption, having a transparent privacy notice and good data security practices is strongly recommended and may be expected by clients and partners.

Employment Law

When you hire, you must meet minimum standards under the Fair Work Act, follow any applicable awards, provide the right entitlements and maintain safe work systems. Use role‑appropriate contracts, commission plans and workplace policies to reduce compliance risks.

Trust Account Rules

State property laws set strict rules for how you receive, hold, disburse and reconcile client money. Expect record‑keeping obligations, timely banking of trust funds and periodic audits. Non‑compliance can lead to penalties or licence action.

Anti‑Money Laundering (AML) Status

As at the time of writing, Australia has proposed “Tranche 2” AML/CTF reforms that would extend AML obligations to additional professions, including real estate, but these changes have not commenced. Real estate agencies are not currently reporting entities under the AML/CTF Act. That said, robust identity checks and fraud‑prevention procedures remain good practice and may be required under your state licensing framework.

Intellectual Property (Brand Protection)

Your brand is an asset. Consider registering your name and logo as a trade mark to help prevent copycats and protect your marketing investment. You can start the process to register your trade mark once you’ve settled on your brand.

Online Presence and Website Rules

If you market or collect enquiries online, publish clear Website Terms and Conditions for site use and ensure your privacy notices are accessible and consistent with your practices.

Key Legal Documents to Put in Place

Having the right contracts and policies in place from day one will set expectations with clients and staff, protect your revenue and make compliance easier. Consider the following:

• Agency Agreement (Sales): Sets out your authority to act for a vendor, your fees and commissions, marketing budgets, exclusivity, cooling‑off where relevant, and termination rights.
• Property Management Agreement: Covers leasing authority, fee schedules, maintenance authorisations, disclosures to tenants, and how you will handle client money.
• Marketing/Advertising Authority: If you run campaigns, document approval processes, budgets, third‑party costs and ownership of marketing assets.
• Tenancy and Application Forms: Clear, compliant forms that include privacy consents, ID collection notices and selection criteria (aligned with discrimination laws).
• Privacy Policy: A public‑facing explanation of how you collect, use and store personal information-publish it on your website and align it with your actual practices via an internal procedure.
• Website Terms and Conditions: House rules for your site and portal use, IP notices, disclaimers and liability limits.
• Employment Contract: Role description, remuneration, commission plans, restraint and confidentiality obligations, and post‑employment restrictions where appropriate.
• Contractor Agreement: If you engage independent contractors (for example, photographers or virtual assistants), set deliverables, turnaround times, IP ownership and payment terms.
• Shareholders Agreement: If you have co‑founders or investors in a company, a Shareholders Agreement covers ownership, decision‑making, exits and dispute processes.
• Non‑Disclosure Agreement (NDA): Use an NDA when discussing confidential growth plans, partnerships or potential acquisitions.
• Office Lease: Ensure commercial lease terms match your operational needs and regulator requirements; consider an early lease review to negotiate key risk areas.

Not every agency needs every document, but most will rely on several of the above. Make sure your templates reflect local laws and your licence conditions, and that your team understands when and how to use them.

Key Takeaways

• Plan your model early-sales, leasing, property management or a mix-and confirm the state or territory licence you and your business will need.
• Choose a structure that suits your risk and growth goals; many agencies set up a company for limited liability and brand credibility. Get tax advice before deciding.
• Register your ABN and business name, set up a compliant trust account, and hold professional indemnity insurance at required levels.
• Comply with core laws from day one, including the Australian Consumer Law, privacy and data security expectations, employment law and trust account rules.
• Protect your brand and cash flow with strong legal documents-client authority agreements, privacy notices, website terms, employment contracts and, where relevant, a shareholders agreement.
• Buying a business or joining a franchise can accelerate growth, but thorough legal due diligence and careful contract review are essential.

If you would like a consultation on starting a real estate business in Australia, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.