Are Your Listing Photos Compliant? What You Need to Know About California’s AB 723.

Kathy Mehringer
Broker of Record -  Compass

Virtual Staging & Digitally Altered Images (CA AB 723)

Effective Date: January 1, 2026

The Big Picture: What's Changing?
Starting January 1, 2026, a new California law (AB 723) requires a new level of  transparency when "digitally altered images"  are used in real estate advertising. This includes common and powerful tools like virtual staging.

The goal is to continue using this technology to showcase a property's potential while leading with the transparency and integrity that our brand stands for. 

This guide outlines our simple, compliant best practices when using AI or training agents to use AI:

Think of it as the Two-Part Rule:
When you use a "digitally altered image" in advertising, you must do two things:

1. Disclose: Add a "reasonably conspicuous" disclosure stating the image has been digitally altered.

2. Show the Original: On any website(s) the broker or agent controls (such as the MLS, Compass.com, and agent/property website(s)), you must also upload the original, unaltered version of the same photo to ensure the consumer is made aware of the accurate and current features/amenities of the property.

What Images Need a Disclaimer?
This law applies when you use any software (including AI) to add, remove, or change elements of the property itself.

DISCLOSURE IS REQUIRED FOR:

• Virtual Staging: Digitally adding furniture, rugs, or art to an empty room.

• Digital Renovation: Changing the texture or color of walls, cabinets, or flooring.

• Offending Object Removal: Editing out power lines, utility poles, wall or floor cracks, or perhaps an adjacent building.

• Landscaping Changes: Making a brown lawn green, adding mature trees when none exist, or digitally adding a pool or other amenities.

DISCLOSURE IS NOT REQUIRED FOR:

• Standard Photo Adjustments that do not change the property's physical condition.

• Examples: Adjusting brightness or lighting, color correction (to make it look more true to life), white balance, sharpening, cropping, or straightening angles.

The Litmus  Test: 

• Are you making the photo look better, or are you making the property look different to make it appear better than it is ? 

• If you're changing the property, you must disclose and add the true-to-life image(s).

Important News:  CRMLS does not allow digitally altered  images other than  “virtual staging,” per MLS rule 11.5 (c) 
Please see a brief summary of  Rule 11.5(c) below:

• Altered Images: Users may not alter photos to modify structural elements, flooring, walls, hardscape, or views, including via AI or photo-editing software. Unless the property will be delivered with  AI enhancements at the close of escrow.

• Virtual Staging/Alteration: If a photo is altered or virtually staged, it must be labeled as such (e.g., "virtually staged") in the description, and the original, unaltered photo should be included.

• Permitted Edits: Standard photo enhancements, such as lighting, color correction, and cropping, are allowed, provided they do not misrepresent the property.

• Compliance: Violations of this rule regarding media misrepresentation are subject to the CRMLS Citation Policy. 

Note: Verify applicable rules with your local MLS. 

Best Practice: Try The "Carousel Method."
This may be the simplest and most effective way to comply with  the law on  MLS, Broker, and agent-controlled websites.

1. The Altered Image: Post your virtually staged or altered photo first. 

2. The Original Image: Immediately after the altered photo (as the next photo in the carousel), upload the original, unaltered version of the same shot.

3. Caption the Original: In the photo caption for the original, unaltered image, label it clearly: "Original Photo" or "Unaltered Image."

4. The Law Also Permits: The use of a link or  QR code to lead the consumer to the “Unaltered Image."

5. Image Collage, Reels, or other Video Imaging: Be mindful that this law, while very specific to digital alterations, does not replace or eliminate General Law in California regarding advertising and true picture to the public, not to mention the NAR Code of Ethics and a variety of MLS Rules. 

5. Sample Disclaimer Language (For Photo Captions)
Use these straightforward disclaimers in the public caption for the altered image:

• For Virtual Staging:
  "Virtually Staged. Some elements have been digitally added."

• For Landscaping/Views:
  "Digitally Enhanced. Landscaping, views have been altered."

• For Digital Renovations (Paint, Flooring, New or Updated Amenities, etc.):
  "Digitally Altered finishes ( e.g. paint/flooring) shown are not as is."

• For General Use/Object Removal:
   "This image has been digitally altered."

The Bottom Line
Following this law — including the disclosure language and the use of the "Carousel Method" — to display the property's actual condition protects you, your client, and Compass from claims of misrepresentation or false advertising and allows the   continued use of  powerful marketing tools while leading with integrity.

“When in doubt, disclose and show the actual/original image.”