Advertising Do’s and Don’ts When Using AI
QUESTION: I’ve been looking at houses with my buyer clients, and we keep seeing listings with AI-enhanced photos. Online, the homes look bright, updated, and pristine, but when we arrive in person, they are often darker, dated, or noticeably worse condition. It feels deceptive, and I’m surprised it’s not illegal. Is it really permitted for agents to use AI-enhanced photos?
ANSWER: North Carolina brokers are already prohibited from using advertising in a manner that misrepresents a property. Under the License Law and Commission Rule 58A .0115, a broker may not make false assurances, exaggerations, or engage in any conduct that creates a misleading impression about a listed property. That standard applies regardless of whether an image is produced through traditional photo editing tools or newer AI technology. The Code of Ethics reinforces the same principle. Article 2 prohibits exaggeration or concealment of pertinent facts, and Article 12 requires REALTORS® to present a “true picture” in their advertising and representations to the public.
Virtual staging and digitally edited photos may be permissible as long as they are not misleading and are clearly identified as altered. Commonly accepted uses include correcting lighting, removing clutter, adjusting perspective, or adding virtual furnishings, provided those edits do not change the actual condition or features of the home. Editing becomes problematic when it changes factual characteristics of the property, such as covering stains or cracks, depicting old or damaged fixtures as new, altering landscaping or surroundings, or presenting a digitally remodeled “after” image as though it reflects current reality. If a buyer walks into a home and reasonably feels that the photos painted a false picture of its condition, that’s exactly the kind of situation these rules are designed to address.
For that reason, North Carolina brokers using AI tools should clearly label altered images, maintain and display unedited photos, and avoid any enhancement that hides, minimizes, or obscures material facts. Listing photos are advertising, and advertising must give a fair and honest depiction of the property being offered. AI can be a useful tool in real estate marketing, but its use is lawful only when it improves presentation without distorting what a buyer can expect when they actually step inside the home. Stepping outside these guardrails could subject a listing broker to complaints and potential discipline before the Real Estate Commission or a local Grievance Committee.
Release Date: 11/27/2025
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