TBR's New MLS Rules: Virtual Staging, Concessions, Comp Listings & Clear Cooperation

Virtual staging has come a long way.

An empty living room can now acquire a sofa, rug, artwork, lamps, houseplants and, apparently, an unlimited supply of decorative vases without anybody carrying a single piece of furniture through the front door.

For sellers, it can be an inexpensive way to help buyers picture how an empty space might function. For buyers, it can make a vacant house feel a whole lot easier to visualize.

But as virtually staged photos become increasingly realistic, there’s an obvious question for real estate agents:

What are we allowed to do, and what do buyers need to know?

That question is especially timely because the Capital Area Technology & REALTOR® Services (CATRS) Board of Directors recently changed one of its local MLS requirements involving virtually staged photos.

What Changed With Virtual Staging?

Until recently, CATRS required the first sentence of a listing’s public remarks to begin with this specific disclosure when virtual staging was used:

“One or more photo(s) has been virtually rendered.”

Last week via email, they announced that (in their July meeting) the CATRS Board of Directors removed that requirement after determining it was redundant with other rules governing virtually staged photos.

The important part is what didn’t happen:

CATRS did not suddenly declare virtual staging a free-for-all.

The change removes the requirement that a particular disclosure occupy the very first sentence of the public remarks. The MLS still has rules designed to keep listing imagery accurate and prevent consumers from being misled.

CATRS Rules About Listing Photos and Renderings

Under the current CATRS MLS Rules and Regulations, at least one property photograph is required for most listing classes before a listing can become Active. The required photo is generally the exterior front of the building, and branding or personal images are prohibited.

More importantly for virtual staging, the rules specifically address inaccurate photos or renderings.

If CATRS determines that a photo or rendering is inaccurate, the MLS can notify the listing agent and require it to be corrected within 48 hours. Failure to correct it can result in suspension of MLS service and a $100 fine per inaccurate listing.

So while technology has changed dramatically, the underlying principle is pretty straightforward:

Marketing can help someone imagine a property. It shouldn’t create a different property.

What Virtual-Staging Rules Still Apply?

The July change was fairly narrow.

It does not mean agents no longer have to identify virtually staged images or follow the other MLS standards that apply to altered listing photos.

Based on CATRS’ existing virtual-staging policy and the July Board update, agents should still make sure virtually staged images are clearly identified as virtually staged or virtually rendered so consumers know they are looking at a modified image rather than the home exactly as it exists.

So the practical takeaway is:

The disclosure didn’t disappear. The requirement that a very specific disclosure occupy the first sentence of the public remarks did.

Agents still need to make it apparent when an image has been virtually staged, and the image itself still needs to comply with CATRS standards for accurate property representation.

Virtual Furniture Is One Thing. Virtual Remodeling Is Another.

This is where virtual staging gets interesting.

Adding a couch to an empty living room helps illustrate one possible furniture arrangement.

Digitally changing something that actually exists in the house is a much different proposition.

There’s an important practical distinction between:

• adding furniture, rugs, artwork and décor to an otherwise accurate image;
• digitally removing existing furnishings to demonstrate an empty room;
• and altering permanent property characteristics such as flooring, walls, cabinetry, windows, fireplaces or other physical features.

CATRS’ rule regarding inaccurate photographs and renderings is why agents should be especially careful once virtual staging moves beyond “here’s how you could furnish this room” and starts becoming “here’s what this house could look like if it were different.”

Beautiful marketing is useful.

A buyer arriving for a showing and wondering where the extra window went is considerably less useful.

What About AI?

This is becoming an even bigger issue because creating these images no longer requires expensive photo-editing software or a professional designer.

AI tools can furnish a room in seconds.

They can also:

• replace flooring;
• repaint walls;
• change light fixtures;
• remove furniture;
• add landscaping;
• modify a fireplace;
• alter a view;
• and occasionally become very emotionally invested in adding another vase.

The easier the technology becomes to use, the more important it is for agents to distinguish between visualizing a space and changing the representation of the property itself.

Why This Matters for Agents

Virtual staging isn't inherently good or bad.

It's a marketing tool.

Used well, it can help a seller present an empty home more effectively and help buyers understand the scale and possibilities of a room.

Used poorly, it can create unrealistic expectations before a buyer ever walks through the door.

That's why the CATRS change is a useful reminder that compliance isn't just about memorizing the exact sentence that has to appear in a particular field.

It's about understanding why the rule exists in the first place.

The MLS database isn't simply an advertising platform. Agents, appraisers, brokers and consumers rely on the accuracy of the information submitted to it.

And as our marketing tools become more sophisticated, knowing where that line sits becomes increasingly important.

Virtual Staging Wasn’t the Only CATRS Update

The July CATRS Board meeting produced three other notable changes local agents should know about.

Seller concessions: Paragon MLS is being updated so agents can report the dollar amount of closing costs and/or other concessions along with a description. Better concessions data should provide more context when agents and appraisers analyze comparable sales and valuations.

Sold/Comp listings: CATRS condensed the requirements for entering sold/comp transactions, and supporting documents can now be uploaded into Paragon.

Clear Cooperation enforcement: Warnings will no longer count toward repeat-offender violations; only fines will. CATRS also codified an additional four-hour grace period after staff notifies the listing agent and broker of a violation before a fine is imposed. The underlying Clear Cooperation rule still requires a residential listing to be submitted to the MLS within one business day of public marketing.

The Bottom Line

Rules change.

Marketing technology changes even faster.

The challenge for agents isn't simply keeping track of which sentence disappeared from the MLS instructions this month.

It's understanding how those changes affect the way we market properties, represent what buyers are actually purchasing and protect the accuracy of the data everyone in our market relies on.

Virtual staging is a perfect example.

By all means, give us the couch.

Give us the rug.

Give us the throw pillows.

Apparently, give us six vases.

Just make sure buyers can tell the difference between what's possible and what's actually there.

Source: Capital Area Technology & REALTOR® Services (CATRS) MLS Rules and Regulations and CATRS July Board of Directors policy update.