California's law on digitally altered listing photos, explained

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A listing photograph does a great deal of work before anybody opens a front door. It decides which homes a buyer shortlists and which viewings are booked. Software can now furnish an empty room, relay a floor or tidy a garden in a few seconds, and the picture that results may show a home that does not exist in quite that form. California has answered with a specific rule. A state law passed in 2025 as Assembly Bill 723 requires real estate licensees to say so when a listing image has been digitally altered, and to point the reader to the original picture.

This guide sets out where that rule comes from, how it reached the statute book, what counts as an altered image and what does not, what the disclosure has to do, who is bound, and what the existing Real Estate Law already said about false advertising. It then places the California rule beside the Code of Ethics of the National Association of Realtors, which requires a "true picture" in advertising. It describes the position as read in October 2026. The wording of the section is taken from the chaptered bill as republished by the bill-tracking service LegiScan, which is a copy and not the Legislature's own publication; the history comes from the Legislature's committee analyses, and the regulator's reading from the Department of Real Estate's advisory of 17 March 2026. The last section lists what those sources leave open.

Section and chapter from the Department of Real Estate's list of statute changes for 2026; compliance date from its advisory of 17 March 2026; filing date from the chaptered bill as republished by LegiScan.

Where the rule sits in California law

Real estate brokers and salespersons in California are licensed and regulated by the Department of Real Estate under the Real Estate Law, which begins at section 10000 of the Business and Professions Code. The Senate Judiciary Committee's analysis of AB 723 recalls that section 10050 requires the Real Estate Commissioner to enforce that law for the maximum protection of buyers.

AB 723, carried by Assembly Member Pellerin under the title "Real estate: digitally altered images: disclosure", adds one section to that body of law. The Department of Real Estate's list of statute changes in the 2026 Real Estate Law records it in a single line: section 10140.8, added by AB 723, Chapter 497. The number places it directly among the advertising provisions. Section 10140, the long-standing rule against false or fraudulent statements in property advertising, sits just before it, and section 10140.6, which the department describes as the rule requiring a licensee's name, licence identification number and responsible broker's identity on solicitation materials intended as the first point of approach to a consumer, sits beside it.

How AB 723 became law

The legislative record shows a bill that was reshaped as it moved. The Assembly Committee on Privacy and Consumer Protection's analysis dates the introduced version to 14 February 2025. In that first form the bill was short: a statement disclosing that an advertising image had been altered, the same images without alteration where the material was posted on a website, and a single exclusion, for the adjustment of lighting.

The Assembly committee heard the bill on 1 April 2025. Its analysis records that the author agreed to amendments which excluded minimal editing, required the disclosure to be reasonably conspicuous and allowed a link to the original image in place of the image itself. The Senate Judiciary Committee's analysis, written for a hearing on 15 July 2025 on the version amended on 2 July 2025, lists the votes up to that point, among them 66 to 2 on the Assembly floor and 8 to 3 in the Senate Committee on Business, Professions and Economic Development.

The dates of the hearings and floor sessions come from the legislative record published by CalMatters' Digital Democracy service. The chaptered bill, in the LegiScan copy, carries both the Governor's approval and the filing with the Secretary of State on 10 October 2025. The Senate analysis marks the bill "Urgency: No", which means it was not written to take effect on signature, and the Department of Real Estate's advisory of 17 March 2026 states that licensees must comply with section 10140.8 "as of January 1, 2026".

The committee analyses describe the bill as it stood in April and July 2025. The text that was chaptered differs from those versions on several points, and the sections below follow the chaptered wording, noting where it moved.

What counts as a digitally altered image

The definition is the heart of the rule, and it changed more than any other part of the bill. In subdivision (b)(1) of the chaptered section, as republished by LegiScan, a "digitally altered image" has three features.

First, it is an image created by, or at the direction of, the real estate broker or salesperson, or a person acting on their behalf. Second, it has been altered using photo editing software or artificial intelligence. Third, the alteration adds, removes or changes elements in the image.

Two things moved between the committee stage and the final text. The Assembly analysis of April 2025 described a definition narrowed to a "still-photo image"; the chaptered wording, in the copy read, says "an image" and does not carry that qualifier. The list of example elements also grew. The committee analyses named furniture, appliances, flooring and walls. The chaptered text lists fixtures, furniture, appliances, flooring, walls, paint colour, hardscape, landscape, facade and floor plans. It then steps beyond the boundary of the home itself, to elements outside of, or visible from, the property, "including, but not limited to" streetlights, utility poles, views through windows and neighbouring properties.

Subdivision (b)(2) says what is left out. The term does not include an image where only certain adjustments have been made: lighting, sharpening, white balance, colour correction, angle, straightening, cropping, exposure, or other common photo editing adjustments that "do not change the representation of the real property". Two details of that sentence matter. The word "only" means the exclusion covers a picture that has had nothing else done to it; a photograph that has been colour corrected and also had a pole removed is an altered image. And the closing phrase gives the test for any adjustment that is not on the list: it stays outside the definition if it is a common editing adjustment and leaves the representation of the property unchanged.

The Department of Real Estate puts the dividing line in similar terms in its advisory: a clear disclosure is required when images have been digitally modified in a way that changes the appearance of the property, and that includes modifications made or enhanced by artificial intelligence. The section itself, as read, does not define artificial intelligence. For the meaning of the term in existing California law, the Assembly analysis points to section 11547.64 of the Government Code.

What the disclosure has to do

The first duty is in subdivision (a)(1). A broker or salesperson, or a person acting on their behalf, who includes a digitally altered image in "an advertisement or other promotional material for the sale of real property" must include a statement disclosing that the image has been altered.

The chaptered text, in the copy read, attaches four conditions to that statement. It must be "reasonably conspicuous". It must be located on or adjacent to the image. It must come with a link to a publicly accessible internet website, URL or QR code that "includes, and clearly identifies, the original, unaltered image". And it must include language indicating that the unaltered images can be accessed on that linked website, URL or QR code.

The last two are where the final text goes further than the committee analyses. In the April version a link was an option for material posted online. In the chaptered paragraph the pointer to the original is part of the statement itself, and the paragraph is not limited to any medium: it speaks of advertisements and other promotional material in general. A printed sheet cannot carry a clickable link, and a web address or a QR code are both among the three routes the text names.

On wording, the section prescribes none. It sets no formula and no type size; the only standard for visibility is "reasonably conspicuous". What it fixes is the content of the message: that the image has been altered, and where the unaltered images can be found. The phrase "clearly identifies" adds a requirement for the destination as well. The page at the end of the link has to contain the original and mark it as the original.

Both conditions of placement are attached to the individual picture: the text asks for a statement on or next to each altered image. The Assembly analysis illustrates the idea with a virtually staged photograph that carries a watermarked "Virtual Staging" label in the image itself. A column carried by the San Diego Association of Realtors on a page dated 1 January 2026, written by a broker of record and presented as the author's opinion and not as legal advice, offers sample captions of the same kind, among them "This image has been digitally altered."

The original image and the website rule

The second duty, in subdivision (a)(2), concerns websites. Where an advertisement or promotional material of the kind described in paragraph (1) is posted on an internet website over which the broker or salesperson, or the person acting on their behalf, has control, the posting must include the unaltered version of the images from which the digitally altered images were created.

The paragraph then offers an alternative. The duty may be met by including a link to a publicly accessible internet website that includes, and clearly identifies, the original, unaltered image. If that route is taken, the statement must include language indicating that the unaltered images can be accessed on the linked website, URL or QR code. The Legislative Counsel's Digest printed with the chaptered bill sums up the pair of duties in two sentences: a disclosure where an altered image is used in sales marketing, and the unaltered version where the images are posted online.

The San Diego column describes one way of arranging the first route, which it calls the carousel method: the altered photograph, followed by the original as the next image with a caption such as "Original Photo".

The words "has control" answer an objection recorded in the Senate Judiciary Committee's analysis. The California Association of Realtors opposed the bill unless amended, arguing that licensees should not be liable for images on third-party sites they do not control, because listings are syndicated and reposted beyond the reach of the person who created them. The chaptered section, as read, has only two subdivisions and contains no provision that speaks of third-party sites, multiple listing services or syndication. The control wording appears in paragraph (2) alone; the statement duty in paragraph (1) is not tied to who runs the site.

How that applies to a listing fed to portals and social media is something the text does not spell out, and published readings in the trade are broad. In a column published by Inman under the date 23 January 2026, America Foy, a broker associate at The Grubb Co., reads the law as reaching every place a buyer might see an altered image, including multiple listing services, portals and social media: "There's no carve-out for Instagram." That is a practitioner's reading and not the regulator's. The Department of Real Estate's advisory states the duty in a single sentence: licensees must make the original, unaltered image available to consumers.

A worked example shows how the two duties combine. Assume a listing with 25 photographs, published on the listing broker's own website. Four of them have been virtually staged with furniture; the other 21 have only been cropped, straightened and colour corrected. On the chaptered text as read, the four staged pictures are digitally altered images. Each carries a conspicuous statement on or next to it, saying that it has been altered and that the unaltered images can be found at a stated link, web address or QR code; and because the site is under the broker's control, the four originals are either included in the posting or reachable through a link to a public page that identifies them. The 21 remaining photographs are not digitally altered images, because only listed adjustments were made to them. If one of those 21 had also had a utility pole removed, the count would become five and 20. The numbers are illustrative; the point is that the rule works image by image.

Who the rule binds

The chaptered text names three duty holders: a real estate broker, a real estate salesperson, and a person acting on their behalf. The Assembly analysis gives the definitions of the first two from existing law: under section 10015 a real estate broker is a person licensed under section 10130 and the sections that follow, and under section 10016 a real estate salesperson is a licensed natural person who, for compensation or in expectation of compensation, is retained by a broker to carry out licensed activities.

The third category reaches the people who in practice produce listing media for a licensee. It matches the definition of the image, which covers pictures created by or at the direction of any of the three. An altered image that none of them made or commissioned sits outside the definition as it is worded.

The section is also limited by transaction. Paragraph (a)(1) speaks of advertising and promotional material "for the sale of real property", and the text as read does not mention leases or rentals. Section 10140, by contrast, is described in the committee analyses as covering property offered for sale or lease, so the general rule against false advertising is wider on this point than the new disclosure rule.

The Department of Real Estate adds the supervisory layer. Its advisory of 17 March 2026 states that section 10177(h), section 10159.2 and Regulation 2725 place responsibility on brokers for supervising affiliated licensees and brokerage operations, that this supervision extends to AI tools, and that brokers may face discipline for failing to supervise. The department says that the licensee, and not the technology provider, remains responsible for what an AI tool produces. Its recommendations to brokers are to adopt written AI policies, train affiliated licensees, monitor compliance and keep records showing how AI outputs were reviewed and verified.

What happens when the rule is not followed

Section 10140.8 states no penalty of its own. The consequence comes from where it sits. The Legislative Counsel's Digest printed with the chaptered bill recalls that a wilful violation of the Real Estate Law is a crime, and describes AB 723 as imposing new requirements on real estate licensees, "the violation of which is a crime". For that reason the Digest classes the bill as a state-mandated local programme, and the bill's second section declares that the state is not required to reimburse local agencies for the costs. The sources also set out the existing framework around it.

The first element is the criminal provision next door. Under section 10140, according to both analyses, publishing a false or fraudulent written statement in an advertisement, pamphlet, prospectus or letter about real property offered for sale or lease is a public offence, punishable by a fine of up to US$1,000 or up to one year in county jail.

The second element is licence discipline. Under section 10176, as the Senate analysis summarises it, the Commissioner may suspend or revoke a licence for substantial misrepresentation, false promises, a continued course of misrepresentation, fraud or dishonest dealing, and for violating a law that applies to licensees. The Department of Real Estate's advisory cites the same section and adds that advertising must be truthful and not misleading whether or not AI is used.

The third element is civil. In its letter, as reported by the Senate Judiciary Committee, the California Association of Realtors pointed to the remedies that already exist for misleading advertising: civil damages, fines and discipline by the department, which in its words could include the loss of the licence in egregious situations.

How these apply to a given advertisement depends on the facts: what was changed, whether it was disclosed, who created the image and where it was published.

Virtual staging in the committees' own words

The analyses are careful about what the bill is not. The Assembly committee describes digital staging as "a useful and economical way" to present a listing, and sets it beside the long-established practice of physically staging a home with furniture and decoration to show its potential. Traditional staging, the analysis notes, usually covers a few rooms, and it cites a national brokerage's estimate of about US$500 to US$600 a room.

The analysis locates the difficulty in one place: an image becomes misleading when it substantially changes the condition of the property, for example by improving an unappealing view from a window, removing unsightly features, repairing damage or upgrading fixtures. One of its two illustrations is a kitchen rendered with cabinetry, countertops and an island that were not in the actual home. The window view now appears in the chaptered definition.

The national context: the Realtor code's true picture

Outside California, the standard most widely cited on listing images is private rather than statutory. The National Association of Realtors publishes a Code of Ethics and Standards of Practice; the 2026 edition is effective from 1 January 2026.

Article 12 of that Code states that Realtors "shall be honest and truthful in their real estate communications" and shall present a true picture in their advertising, marketing and other representations. Standard of Practice 12-10 applies the true-picture duty to internet content, images, web addresses and domain names, and lists practices it prohibits: deceptive framing, manipulated content, deceptive metatags, unattributed content and misleading images.

The California Legislature drew the connection itself. The Senate Judiciary Committee's analysis states that the bill's provisions align with Article 12 and Standard of Practice 12-10, and quotes the California Association of Realtors' staging guidance, which says that if a property is altered, a clear and explicit warning must be included.

The two instruments differ in three ways. The first is reach. The Code applies to Realtors, a term the Code says includes Realtor-Associates; it binds members of the association. Section 10140.8 binds California brokers and salespersons because they are licensed, whether or not they are members.

The second is precision. The Code states a principle, a true picture and no misleading images, and leaves its application to the case. The California section names the kinds of edit that trigger it, lists those that do not, and prescribes where the statement goes, what it must say and what it must link to.

The third is enforcement. Under Article 14 of the Code, a Realtor charged with unethical practice places the facts before the tribunals of the Member Board. The California rule belongs to a state licensing law administered by the Department of Real Estate. The Code also settles the order between the two: where the Code and the law conflict, it says, the obligations of the law take precedence.

A national code asks for a true picture. California now says which edits make a picture something else, and what must be shown beside it.

What the sources leave open

Five points could not be settled from the documents read for this guide.

The first is the official publication. The wording described here was read in LegiScan's copy of the chaptered bill, not on the Legislature's own site or in the Department of Real Estate's printed Real Estate Law. A copy can carry errors, and the official text is the one that counts.

The second is syndication. The section contains no provision on third-party sites or multiple listing services, and the sources read do not include a statement from the Department of Real Estate on how the statement duty applies to an image that travels from a licensee's listing to sites the licensee does not run.

The third is moving pictures. The chaptered definition speaks of "an image". None of the sources read says whether video, reels or virtual tours fall within that word; the San Diego column mentions them only to recall that general advertising law, the Realtor Code and listing service rules apply in any case.

The fourth is timing. The Inman column of January 2026 observes that the statute does not say how it applies to listings already online before 1 January 2026.

The fifth is practice. The Department of Real Estate's advisory restates the duty and the compliance date, and gives no template statement, no size or position standard beyond the law's own terms, and no account of enforcement to date.

Kooky, from Shaka

Kooky edits Agents Estate and builds Shaka, the payment router he made for real estate professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.

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