California’s 2026 legislative updates introduce several important changes that directly affect how residential properties are marketed and sold. These laws focus on transparency, consumer protection, and the responsible use of digital tools—especially AI—in real estate advertising.
For homeowners, churches, and nonprofits selling residential property such as parsonages or staff housing, understanding these updates is essential for compliance and risk management.
AB 723 – Mandatory Disclosure of Digitally Altered Listing Photos:
One of the most significant changes for residential sellers is AB 723, which regulates the use of digitally altered or AI‑edited images in property marketing.
Under this law, if a seller or agent uses any photo that has been digitally modified beyond basic adjustments, they must:
- Provide a clear disclosure that the image has been altered
- Include a link or QR code to the original, unedited image
- Ensure that edits do not misrepresent the property’s true condition
Minor edits—such as brightness, cropping, or color correction—are still allowed without disclosure.
This requirement is designed to protect buyers from misleading representations and applies to MLS listings, flyers, websites, and social media posts.
Expanded Residential Disclosure Expectations:
Beyond AB 723, California’s 2026 real estate updates emphasize broader transparency in residential sales.
According to statewide legal summaries, sellers must now take extra care to ensure that:
- AI‑generated descriptions or images are clearly identified
- All material facts are disclosed fully and accurately
- Marketing materials do not unintentionally mislead buyers
These updates reflect the Department of Real Estate’s ongoing push for honest representation and clear communication in all housing transactions.
HOA‑Related Disclosure Updates for Condos and PUDs:
If the property being sold is part of a homeowners’ association, 2026 brings additional disclosure obligations.
New HOA‑related laws require:
• Greater transparency in reserve studies
• Clear identification of any AI‑generated HOA communications
• Updated documentation regarding fines and enforcement practices
Sellers must ensure that buyers receive current, compliant HOA packets that reflect these 2026 updates.
Notes:
For anyone selling a residential property in 2026—whether a homeowner, investor, or nonprofit organization—these laws create new responsibilities. These updates are especially important for churches and nonprofits that may rely on volunteers or staff to prepare listing materials. Even well‑intentioned digital edits can trigger disclosure obligations under AB 723.
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Disclaimer: Every situation is different and particular facts may vary thereby changing or altering a possible course of action or conclusion. The information contained herein is intended to be general in nature as laws vary between federal, state, counties, and municipalities and therefore may not apply to any given matter. This information is not intended to be legal advice or relied upon as a legal opinion, course of action, accounting, tax, or other professional services. You should consult the proper legal or professional advisor knowledgeable in the area that pertains to your particular situation.
