California AB 723: What Every Agent Needs to Know About the New AI Listing Photo Law

By AIDE Transaction Coordination | aide-re.com

If you use virtual staging, AI photo tools, or any kind of digital editing on your listing photos — and most agents do — California's new AB 723 law applies to you. It went into effect January 1, 2026, and most agents are still not fully aware of what it requires.

Here is a clear breakdown of what the law says, what it covers, what it does not cover, and what you need to do right now to stay compliant.

What Is AB 723?

Assembly Bill 723 adds Section 10140.8 to the California Business and Professions Code. It requires real estate brokers, salespersons, and anyone acting on their behalf to disclose when property marketing images have been digitally altered — and to provide buyers access to the original, unedited versions.

The goal is straightforward: buyers deserve to know what a property actually looks like, not just what it looks like after editing. This is especially important now that AI tools have made it faster and easier than ever to dramatically alter listing photos.

Violating this law is not just an MLS compliance issue. Willful violations can constitute a criminal misdemeanor under California law. The California Department of Real Estate also has enforcement authority, including disciplinary action against brokers and salespersons, and civil liability exposure.

What Counts as a "Digitally Altered" Image?

An image is considered digitally altered under AB 723 if it was modified using photo editing software or artificial intelligence to add, remove, or change visual elements of the property in a way that affects how a buyer perceives it.

Examples that require disclosure:

• Virtual staging — adding furniture, rugs, or decor to an empty room

• Removing clutter, equipment, or personal items

• Adding or enhancing a fire in a fireplace

• Greening dead or brown grass

• Removing power lines, neighboring structures, or other exterior elements

• Adding pool water or reflections

• Changing paint colors or flooring

• Any AI-generated enhancements to the property's physical appearance

Examples that do NOT require disclosure:

• Adjusting brightness, exposure, white balance, or color correction

• Cropping or straightening an image

• Sharpening or basic clarity adjustments

The test is simple: does the edit make the property appear different from how it actually looks? If yes, disclosure is required.

What the Disclosure Must Include

When you use a digitally altered image in any real estate marketing, you must:

1. Include a clear and conspicuous disclosure stating that the image has been digitally altered. This must appear on or directly adjacent to the altered image — not buried in fine print elsewhere.

2. Provide access to the original, unaltered image. How you do this depends on where the image appears:

• For print advertising (flyers, brochures, mailers): Include a link, URL, or QR code that buyers can use to view the original photo on a publicly accessible website.

• For online advertising on a website or MLS platform you control: You can either follow the print rule above, OR simply include the unaltered photo directly alongside the altered one in the listing.

CRMLS has already updated its internal rules to align with AB 723. For MLS listings, altered images must be labeled as "digitally altered" or "virtually staged," and the original photo must be included either directly before or after the altered version in the listing view. MetroList also updated its rules effective February 2, 2026 under Section 11.6.1 with the same requirements.

Where This Applies

This law is not limited to MLS listings. It applies to every place your marketing appears, including:

• MLS listings

• Your personal or brokerage website

• Social media posts and ads

• Print flyers and mailers

• Email marketing

• QR code photo galleries

• Any promotional material for the property

If you did not create the altered image but it is published in your listing or under your name, you are still responsible for compliance.

What About Existing Listings?

The law applies to listings posted on or after January 1, 2026. Listings posted before that date are generally not retroactively subject to the requirement. However, if a listing is re-activated or re-listed after January 1, 2026, full compliance applies. When in doubt, consult your broker's compliance team or review the California Association of REALTORS® 2026 New Laws guidance.

Practical Steps to Stay Compliant

1. Audit your current listings. Review any active listings posted after January 1, 2026 and identify photos that have been digitally altered. If they are not properly labeled and accompanied by the original, fix them now.

2. Create a simple compliance workflow. When you receive edited listing photos, ask your photographer or editor to provide both the original and the altered version. Store originals in a publicly accessible folder or photo gallery and use a single QR code linking to all originals for print materials.

3. Label altered images clearly. Use captions like "Virtually Staged," "Digitally Altered," or "Image has been digitally altered" directly on or next to the photo.

4. Talk to your photographer. Many professional real estate photographers in California are already building AB 723 compliance tools into their delivery systems. Confirm that your photographer is providing both versions and documenting which images were edited.

5. When in doubt, disclose. If you are unsure whether an edit crosses the line from acceptable adjustment to digital alteration, disclose it. The legal exposure from over-disclosing is zero. The exposure from under-disclosing is significant.

Why This Matters Beyond Compliance

This law reflects a broader shift in how California regulators are approaching AI and digital manipulation in consumer-facing industries. Real estate has always been held to a high standard of disclosure — and that standard is now extending to visual marketing.

Agents who embrace this transparently will build more trust with buyers. Buyers who feel deceived by listing photos — especially those who make offers without physically seeing a property — have clear grounds for complaint, civil action, and DRE disciplinary action. Protecting yourself starts with an honest listing.

For more on how recent legal and regulatory changes are reshaping real estate practice, read our posts on the NAR MLS Rule Changes, New California Real Estate Laws for 2025, and 10 AI Tools Every Real Estate Agent Should Be Using in 2025.

Stay compliant. Stay professional. AIDE is here.

AIDE Transaction Coordination | aide-re.com | support@aide-re.com