California AB 723, in plain English for real estate agents

California AB 723 is the first US state law that directly addresses digitally altered real estate photos in marketing — including virtually staged images. If you list property in California and you use virtual staging, the law applies to you. This post walks through what the statute requires, what it doesn't, and what we recommend every agent put in their listing workflow.

What the law actually requires

Stripped of the legalese, AB 723 says three things. First, if you materially alter a listing photo digitally, you need to disclose that alteration in the listing. Second, you need to keep the unaltered original and hand it over if a potential buyer or their agent asks. Third, you cannot use digital alteration to hide defects or misrepresent structural features.

'Material alteration' is the language courts will end up defining over time, but in practice it captures everything an MLS-safe virtual staging workflow does: adding furniture, changing wall color, adding plants, swapping soft furnishings. It does not capture minor color correction or straightening a tilted horizon — those have always been accepted practice.

What counts as a material alteration

The dividing line most MLSes and courts have converged on is simple: if a reasonable buyer would form a different opinion about the property because of the alteration, it's material. A few examples:

• Adding furniture to an empty room — material. Trigger disclosure.
• Replacing a worn rug with a new rug in the render — material. Trigger disclosure.
• Changing flooring material (wood to tile, for example) — material AND probably misrepresents structure. Avoid entirely.
• Removing a visible crack, water stain, or power outlet — material AND misrepresents defects. Do not do this under any circumstance.
• Adjusting exposure or white balance within a reasonable range — not material. No disclosure needed.
• Adding a window, door, or built-in feature that doesn't exist — not only material, but a likely misrepresentation of structure. Do not do this.

A 5-step compliance checklist

For every listing that includes virtually-staged photos:

1. Keep the original, untouched photo on file. Cloud folder, Dropbox, MLS-native archive — anywhere you can retrieve it in under an hour.
2. Label the altered photo in your MLS listing description with a short disclosure line. We suggest something like: 'Virtually staged; original photo available on request.' That's it.
3. Verify that no structural element in the altered photo misrepresents the property. Same windows, same walls, same camera angle, same flooring material, same permanent fixtures.
4. Don't use altered images to hide defects. If there's a stain, a crack, or a dated fixture in the original, it needs to be visible in the altered version too (or the altered version needs a separate line-item disclosure).
5. If a buyer or buyer's agent requests the original, send it. You have to — and it's also the right thing to do.

How Hausey's MLS-safe mode handles it

Our MLS-safe mode is built around three ideas that map directly onto AB 723. First, every output is verified by an automated structural consistency check — windows, doors, walls, fixtures, camera angle, flooring material, and wall additions like millwork or built-ins. If any of those drift, the variation is rejected and regenerated; if it still drifts, we drop it. You never see a compliance-risky output.

Second, the original photo stays one click away on your dashboard. Six-hour signed URLs let you hand the link to a buyer's agent or counsel without exposing your account.

Third, every altered photo ships with ready-to-paste disclosure text. You copy it into your MLS description and the language is already compliant with both AB 723 and the stricter regional MLSes in California.

What happens if you get this wrong

AB 723 enforcement is new and untested, but the framework it hooks into — California's Unfair Competition Law and existing real estate disclosure law — has a long history. The exposure is not theoretical. Buyers who feel deceived by marketing photos have standing. MLSes can suspend listings. And the Department of Real Estate has independent authority over licensed agents.

The good news is that compliance is genuinely easy. It's the five steps above, every time, no exceptions. Tools help; but the discipline is what matters.