New California Law Regulates Use of AI Images in Real Estate Ads
California recently enacted a new law that requires real estate brokers or salespeople who use a “digitally altered image” in a property ad to include a specific disclosure that they have done so. Violating this new law is considered a crime and can lead to a fine and a jail sentence of up to one year. It can also result in the suspension or revocation of the broker’s or salesperson’s license.
The LLF National Law Firm’s Professional License Defense Team can help you understand the scope of this new California law. And because other states are likely to adopt similar laws, cases that are decided in California may have an effect on how similar cases are resolved in those other states. To learn more about how the LLF National Law Firm’s Professional License Defense Team can help you stay compliant with your state’s real estate sales laws and regulations, call us at 888.535.3686, or submit our online contact form so we can schedule a confidential consultation to go over your concerns and explain how we can help.
The California Law Relating to Digitally-Altered Images in Real Estate Ads
California’s Assembly Bill 723, signed into law by Governor Newsom in October of 2025, applies to “digitally altered” images included in an “advertisement or other promotional material” relating to the sale of real property. A “digitally altered” image is one that has been altered by the use of photo editing software or artificial intelligence to “add, remove, or change elements in the image.” Real estate brokers and salespeople must include a disclosure along with those altered images “that the image has been altered.”
They must also include a link or QR code to a “publicly accessible internet website” that includes and identifies the original image that was altered. That disclosure, including the link, must be “reasonably conspicuous” and must be “located on or adjacent to the image.” It needs to note that the original images can be viewed on the website accessible via the link. Alternatively, the original images can be displayed along with the altered ones in the same ad or on the same webpage.
The law specifically notes that the definition of “digitally altered image” does not include one where only certain adjustments, such as lighting, sharpening, color correction, and the like, have been made that “do not change the representation of the real property.”
Concerns for Licensed Real Estate Professionals
The law went into effect on January 1, 2026. Real estate professionals in California need to pay close attention in situations where, for example, an empty room in a home listed for sale has been “digitally staged” with furniture that is not in fact present in the home. In that case, the ad would also need to include a photo of the room as it exists without that digitally staged furniture, or a link to that photo. It would also need a “reasonably conspicuous” notice that the digitally staged image had been altered.
Consumers concerned that a real estate ad is deceptively displaying images in violation of this new law can file both criminal complaints with local authorities and complaints against the real estate professional’s license with the California Department of Real Estate. How strictly the DRE will enforce this new requirement remains to be seen. And questions about how much fine-tuning of images (adjustments to lighting, color, sharpness, etc.) will be allowed before the image is considered to be “digitally altered” still remain to be answered.
The LLF National Law Firm’s Professional License Defense Team Can Help
If a complaint has been filed against you with the DRE, accusing you of violating California’s new digitally-altered images notice law, contact the LLF National Law Firm’s Professional License Defense Team for help. We understand the laws, regulations, rules, and procedures that apply in disciplinary cases brought before the DRE. We regularly defend real estate professionals in California as well as in states across the country who have been accused of violating their state’s laws and regulations relating to the sale of real estate. Our experienced attorneys are ready to help you protect your license and your livelihood.
Call the LLF National Law Firm’s Professional License Defense Team today at 888.535.3686, or submit our online contact form, and we will schedule a confidential consultation to discuss your case. Tell us about the allegations made against you, and let us explain how we can help protect your future as a licensed real estate professional in California.