California’s New Disclosure Rule for Digitally Altered Real Estate Marketing

First impressions in real estate are increasingly made through a screen. Professional photography has always shaped how buyers perceive a home, but today’s digital tools can do far more than brighten a room or warm a sunset. They can provide virtual staging and walkthroughs, and enable listing agents and property owners to fix eyesores and property damage. While physical staging can cost thousands of dollars and take time, virtual staging with artificial intelligence dramatically streamlines the process.

On October 10, 2025, Governor Newsom signed into law a first-in-the-nation disclosure requirement for digital alteration of real estate marketing materials. Assembly Bill (“AB”) 723, which goes into effect on Jan. 1, 2026, requires licensed real estate brokers and salespersons to clearly disclose when an image used in real-estate marketing has been digitally altered, and makes it a criminal offense to fail to make this disclosure. 

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