The disclosure itself is easy: a short label on or next to the image, the same label in the MLS photo field, and the original photo alongside. This guide covers what counts, what the label should look like, and what happens if you skip it. It is general information, not legal advice.
The disclosure requirement, in one paragraph
There is no single national rule, but the strictest common requirements look like this: when software or AI has been used to add, remove, or change visible elements in a listing photo (furniture, fixtures, finishes, landscaping, views, neighboring properties), label the image as altered, put the label on or next to the image, and make the unaltered original available, either right next to the staged photo in the listing or through a link. That is what California's AB 723 requires in advertising and what MLSs such as CRMLS and Canopy require in listings.
Your MLS may add specifics, and some MLSs ban certain edits outright even with a label.
What counts as "virtual staging" requiring disclosure
Disclosure required (or strongly advised):
- Adding virtual furniture, décor, art, rugs
- Decluttering (removing furniture or personal items)
- Day-to-dusk conversion and sky replacement (these go beyond a lighting adjustment)
- Changing wall color or finishes, where your MLS allows it at all (CRMLS and Stellar MLS do not)
- Changing landscaping, views, or neighboring properties, which several MLSs prohibit outright
Never edit out defects such as water stains or cracks. A label does not fix hiding a material problem, and MLSs such as Canopy and Stellar prohibit it.
Disclosure NOT required (common edits):
California's AB 723 excludes these, and CRMLS follows the same line, as long as the edit doesn't change how the property is represented:
- Lighting, exposure, sharpening, white balance, color correction
- Cropping, straightening, angle correction
- Other common adjustments, such as standard HDR exposure blending
The line: if the edit changes what a buyer would perceive as the actual condition of the property, you need disclosure. If it just makes the existing condition photograph well, you don't. When in doubt, disclose.
How the disclosure needs to look
Rules differ mainly on where the disclosure goes. One approach covers the common requirements.
A practical disclosure label
"Virtually staged. Furniture and décor are not included in the sale. See the original, unaltered photo at [short URL or QR code]."
Put it on the image where it stays readable at thumbnail size, repeat it in the MLS photo description field, and upload the original immediately before or after the staged photo.
How that maps to the main rules:
- California AB 723: a reasonably conspicuous statement on or adjacent to the image that it was altered, plus a link, URL, or QR code to the original, with wording saying the original can be viewed there (Bus. & Prof. Code §10140.8).
- CRMLS Rule 11.5.2: a label such as "Virtually Staged" or "Digitally Altered" in the altered photo's text field, with the original displayed immediately before or after it (CRMLS rule text).
- Canopy MLS §1.18: disclosure on the image itself or within the virtual tour, plus a non-staged original immediately before or after (Canopy MLS).
- NAR Article 12 and Standard of Practice 12-10: present a true picture and don't mislead consumers with images, in any market (2026 Code of Ethics).
- Wisconsin 2025 Act 69 (from January 1, 2027): reported to require disclosure when technology materially alters how a property is presented in marketing images; check the final wording before then.
If your MLS prescribes its own wording, use it. Read the full disclosure-language guide.
When you download a staged photo from SofaBrain, you can choose a version with a "Virtually staged" label on the image plus the original photo, or a side-by-side before and after. That gives you the on-image label and the original to upload; the MLS fields and any prescribed wording are still up to you.
What doesn't count as disclosure
Common formats that fall short:
- Just a sentence in the listing remarks. Canopy says disclosure only in captions or agent remarks is not acceptable, and CRMLS wants the label in the altered photo's own text field.
- A watermark with just "Virtually Staged". Enough for some MLSs, but AB 723 also requires a link to the original and wording saying the original can be viewed there.
- An asterisk or footnote at the bottom of the listing. AB 723 requires the statement to be reasonably conspicuous and on or adjacent to the image; a footnote elsewhere doesn't meet that.
- A separate "About this listing" page. The disclosure has to travel with the photo.
What happens if you don't disclose
Several layers of risk:
1. MLS enforcement
Usually corrective at first. Under CRMLS's FAQ (updated July 2026), a violation gets a warning, then a $250 fine if not corrected in time (CRMLS). Other MLSs may remove offending photos or fine under their own schedules.
2. State licensing discipline
State license laws generally prohibit misleading advertising, with or without an AI-specific law. In California, AB 723 is part of the Real Estate Law, whose willful violation is a crime, and the Department of Real Estate can discipline licensees. In New York, the Department of State's November 2025 trend alert on AI-generated listing images reminded licensees that misleading ads are prohibited under Real Property Law §441-c and can lead to discipline.
3. Civil lawsuits
A buyer who relied on a misleading photo can bring a misrepresentation claim, and state consumer-protection statutes can add remedies. Massachusetts Chapter 93A and New Jersey's Consumer Fraud Act, for example, allow multiplied damages.
We are not aware of a published US court decision focused on AI virtual staging as of October 2026, but these claims don't need an AI-specific law.
4. Your E&O coverage
If you are sued, your errors and omissions (E&O) policy normally pays for the defense, so check how it treats AI. Some insurers have begun adding AI exclusions to liability policies; Verisk's ISO, for example, released optional generative-AI exclusions for commercial general liability policies in January 2026 (Big I summary). Real estate E&O policies vary, so read your exclusions or ask your carrier how a claim involving an AI-edited photo would be handled. Clear disclosure helps here too: it is hard to argue you concealed anything when every altered photo was labeled and the original sat next to it.
How to disclose correctly — practical checklist
For every virtually staged or AI-edited listing photo:
- Label on or next to the image ("Virtually staged" or your MLS's wording)
- The same label in the MLS photo description field
- Original unaltered photo uploaded immediately before or after the staged one
- For California advertising: a link, URL, or QR code to the original, with wording saying the original can be viewed there
- No edits to permanent features, views, or defects
- Originals and edited files saved, with a note of what was changed
- Accurate answers to any AI-usage questions on your E&O renewal application
Frequently asked questions
Do I have to disclose lighting and color correction?
No. California's AB 723 excludes lighting, sharpening, white balance, color correction, angle, straightening, cropping, exposure, and similar common adjustments that don't change how the property is represented, and CRMLS follows the same line. Replacing the sky or converting a daytime photo to dusk goes further than that, so label those.
Is it enough to disclose virtual staging in the listing description?
Usually not. CRMLS requires the label in the altered photo's own text field, and Canopy MLS requires it on the image or within the virtual tour, saying remarks alone are not acceptable. The safest approach is a label on the image plus the photo description field, with the original right next to the staged photo.
Can I use a small unobtrusive watermark?
Yes, as long as it stays legible. AB 723 sets no font size but requires the statement to be reasonably conspicuous and on or adjacent to the image, and Canopy requires a clear, readily visible disclosure. Check that the label is readable at thumbnail size.
What if I'm a buyer's agent? Do I have disclosure obligations?
The labeling rules fall on whoever creates and publishes the listing photos, so as a buyer's agent you usually have no disclosure duty for someone else's images. You do owe your client careful representation, so point out photos that look altered and encourage them to see the property in person.
What if the listing photographer uses AI without telling me?
You are likely still responsible. AB 723 covers images created by the licensee or at their direction, including by anyone acting on their behalf, and MLS rules put the obligation on the agent who submits the photos. Ask your photographer in writing whether they use AI edits, and require them to tell you whenever they do.