Do you have to disclose virtual staging?

What California's AB 723 actually says

The bill is called Real estate: digitally altered images: disclosure. It was signed on October 10, 2025 and took effect on January 1, 2026. Two obligations sit at the centre of it, and they apply to "a real estate broker or salesperson, or person acting on their behalf" — which includes your photographer, your marketing assistant and any software you use.

1. A disclosure that is hard to miss. The statute asks for a statement that the image has been altered, "reasonably conspicuous and located on or adjacent to the image." A line buried at the bottom of the listing remarks is not on or adjacent to the image.
2. The original, available. The unaltered photo has to be reachable — posted directly where the listing is under your control, or reachable by a link, URL or QR code to a publicly accessible page.

An image counts as digitally altered if photo editing or AI was used to add, remove or change physical elements — the statute names fixtures, furniture, landscaping, views and neighboring properties. Virtual staging is squarely inside that. What is not covered is the ordinary work every listing photo gets: lighting, cropping, color correction, straightening.

A violation is a crime under existing California Real Estate Law. That is a sentence worth reading twice, because it is not the usual "may result in disciplinary action" language.

What this means for a normal listing

Nothing about virtual staging has become illegal. The thing that has become illegal is doing it quietly. In practice, three habits cover it:

• Put the words on the picture. A "Virtually staged" label baked into the image travels with it — onto Zillow, into a PDF flyer, into a screenshot somebody texts a friend. A caption does not travel. Given the statute asks for the disclosure to be on or adjacent to the image, the label is the version that is still compliant after the photo leaves your MLS.
• Upload the original too. Most California MLSs have implemented AB 723 by asking for the unaltered photo to be paired with the altered one. SDMLS states it plainly: the image must be clearly disclosed as digitally altered, and "the unaltered original image must be available and paired with the altered image."
• Never change the house. Furniture is staging. Removing a power line, widening a room, greening a lawn, editing out the neighbor's roof — those change what somebody is buying, and no disclosure makes them a good idea.

Outside California

The federal picture has not changed, but it was never permissive. Under the Realtor Code of Ethics, Article 12 requires a true picture in advertising, and most MLS rules independently require a virtually staged photo to be identified — by a watermark on the image or a notation in the photo description — and many already ask for the unstaged original to be included.

So the honest summary is: California made explicit, and criminal, what the rest of the country already expected of you. If you are already labeling and keeping originals, AB 723 asks nothing new. If you are not, California is the first state to attach real consequences.

The part nobody mentions: disclosure is good marketing

There is a widespread worry that a "virtually staged" label makes a listing look weaker. The behavior of actual buyers suggests the opposite problem. The loudest complaint about virtual staging is not that it exists — it is arriving at a showing to find a house that looks nothing like its photos. A visible label and a visible original head that off, and the buyer who walks in already knowing the room is empty is a buyer who is not disappointed.

The National Association of Realtors' 2025 Profile of Home Staging also puts the value of staging itself in perspective: 49% of sellers' agents observed that staging reduced time on market, and 29% reported staging led to a 1% to 10% increase in the dollar value offered. Worth noting honestly in the same breath: the same report found 34% of sellers' agents considered virtual staging less important than physical staging, and 24% felt it was equally important. It is a tool, not a miracle.

Who is actually on the hook

The statute reaches "a real estate broker or salesperson, or person acting on their behalf." That last clause is the one worth reading carefully, because it means the obligation does not move when the work does. If your photographer stages the image, if your marketing coordinator uploads it, if a piece of software adds the furniture — the disclosure duty is still yours. "The vendor did it" is not a defence, and a tool that hands you a staged photo without the original leaves you holding an obligation you cannot meet.

It also reaches every channel. The bill covers "an advertisement or other promotional material for the sale of real property," and there is no carve-out for a particular platform. The staged photo in your MLS, the same photo on a portal, on your own site, in an emailed flyer, on a printed sheet at an open house, in a social post — each of them is promotional material carrying a digitally altered image.

The three mistakes that make a compliant photo non-compliant

• Disclosing once, for a whole gallery. A single line in the listing remarks saying "some photos are virtually staged" leaves a buyer unable to tell which ones. The statute asks for the disclosure on or adjacent to the image, which means per-image, not per-listing.
• Keeping the original somewhere you cannot link to. An untouched file sitting in a folder on your laptop is not "available" in the sense the law means. It has to be posted or reachable by a link, URL or QR code. This is the half people forget, because the label feels like the whole obligation and it is only half of it.
• Letting the label fall off in transit. A caption lives in the system you typed it into. Syndicate the listing, export a PDF, let somebody screenshot a room they liked and text it to their partner, and the caption is gone while the photo travels on. A label baked into the pixels is the only version that survives the journey.

What a good disclosure actually looks like

There is no prescribed wording in the statute, which is a gift as long as you do not overthink it. The phrase agents and MLSs have settled on is "Virtually staged", set in the corner of the image, legible at thumbnail size, in a colour that holds against a light or dark room. Three things make it work:

1. It is on the photo. Not under it, not beside it, not in a field.
2. It is readable where people look. A portal thumbnail is small. A label sized for a full-screen view can vanish at gallery size, which is exactly where the buyer forms the impression.
3. It says what happened, not how clever it was. "Virtually staged" is a fact. "AI-enhanced visualization" is a phrase somebody wrote to avoid saying it.

And pair it with the original. Most California MLSs implement AB 723 by asking for the unaltered photo to be uploaded alongside the altered one — SDMLS states that the original "must be available and paired with the altered image." Practically, that means downloading both files from whatever tool you used, which is only possible if the tool kept your original in the first place.

What happens if you get it wrong

AB 723 attaches to existing California Real Estate Law, under which a violation is a crime — not the usual "may be subject to disciplinary action" phrasing that most marketing rules carry. In practice the realistic exposure for an ordinary agent is not a prosecution; it is a complaint to the Department of Real Estate, an MLS citation, and the much more common commercial cost: a buyer who felt misled, walked, and told their agent why.

That last one is the reason to take it seriously even outside California. Disclosure is cheap. A buyer who arrives expecting an empty room and finds an empty room is a buyer still in the conversation.

How to comply in about ten seconds a photo

The workflow that satisfies both halves of AB 723 is short:

1. Stage the photo.
2. Turn on the "Virtually staged" label so the words are baked into the image itself.
3. Download both the staged photo and the untouched original.
4. Upload them as a pair, in whatever order your MLS specifies.

SoldStaged does the middle two by default: the disclosure label is a toggle, and your original is always kept for download alongside the staged version, because the law now asks for both and a tool that only hands back the staged one leaves you half-compliant.