What California AB723 means for Sacramento home buyers and sellers...

If you’ve ever clicked through a Sacramento home listing and thought, “Wow… this looks amazing,” only to tour the house and quietly wonder where the sofa, that amazing sunset, and vibrant green grass in the front yard went, then you’re not alone. Real estate photos have gotten very good. Sometimes too good. 

On all of my listings I hire an awesome professional photographer who does an stellar job at capturing the perfect angle, balancing light, and softening the rough edges of homes...but some agents and photographers take things a few steps too far and use AI or other tools to virtually add features a home just does not have, or photoshop out those fugly power lines running through the backyard, or virtually remodel a home. 

I have walked into homes with clients before and been like "Huh, I thought this kitchen was remodeled?"

Enter California AB723, a new law going into effect next week that is designed to bring and fewer surprises to real estate marketing photos. Starting January 1, 2026, real estate listings in California will be required to clearly disclose when images have been digitally altered in ways that materially change the features of the property. In plain English: if a photo has been edited to add furniture, change landscaping, remove unsightly neighboring properties, repaint walls, or otherwise make the property look meaningfully different than it is in real life, the listing must say so. And the listing must make this original image available. 

Now, don’t worry: this doesn’t mean listings have to look boring or unpolished. Basic touch-ups like adjusting lighting, color balance, optimizing the way a room looks with a wide angle lens, or cropping a photo are still perfectly fine. AB723 focuses on changes that could impact how a buyer perceives or understands the actual condition or features of the home. 

So as an example from one of my own listings -- last year I wanted to illustrate that the backyard of an Arden-Arcade home I listed was potentially big enough to build an Accessory Dwelling Unit. So I hired someone to add a rendering of an ADU to one of the aerial drone images my professional photographer took. And they also happened to edit the grass to be more green (which I did not ask them to do but it sure made the photo look better!). I did add a disclaimer to the photo and include the original in the listing, however now in the future I would also want to add a disclosure to the image specifically noting it was digital altered. For what it is worth, I also added some virtual staging furniture to two rooms, and did disclose the images were altered and provided the originals, as you can see in the archived listing online. Was I required to by law at that time? No. But I have always felt transparency is better. And now everyone in California will have to disclose digital alterations.

For home buyers, this is a win. You’ll have clearer expectations before you ever step foot inside a home. If a listing photo has been digitally altered, you’ll know it, and you’ll also have access to the original, unaltered images. Fewer surprises means better decision-making, less frustration, and hopefully fewer “Wait… where did that go?” moments during showings. 

For home sellers, this law encourages transparency without taking away great marketing. Virtual staging and enhanced photos can still be used -- they just need to be clearly labeled. Trust me seller, you want to avoid buyer disappointment when they walk in the door. That can leave a bad taste in a buyer's mouth...you want a buyer to connect with your home, not be frustrated by a big letdown or upset expectations. 

Real estate is already emotional enough for buyers without feeling catfished by a listing photo. This new law will help keep expectations realistic.

Accessory Dwelling Units -- want to build one? It is a lot easier than it has been in the past...

At the end of 2019, during an interview with the Sacramento Bee asking my opinion about the local Sacramento real estate market, the reporter asked about my most "out there" forecast or trend: I responded with -- wait for it -- constructing Accessory Dwelling Units, aka - ADU's! 

At that time, I was optimistic that as some state legislation encouraged city/county ADU application streamlining and the "by-right" ability of residential property owners to add ADUs to their properties, we'd see more homeowners building them. There are many parcels in greater Sacramento that could easily accommodate ADUs, whether that means converting existing space like a garage or basement to an ADU, or constructing a freestanding ADU Casita in the backyard. We could have thousands of mini-infill projects all over our region adding more housing at affordable prices.

Well, fast forward to 2025: ADUs have arrived! 

An Accessory Dwelling Unit (ADU) is a secondary residence on the same lot as a primary home. It can be attached, detached, or created by converting existing spaces like a basement. ADUs offer flexible living solutions, increase housing unit supply, and provide more affordable housing options. Examples include detached cottages, garage conversions, or repurposed home areas.

I am noticing ADU construction all over greater Sacramento...I am also noticing more and more that you can purchase existing resale homes with ADUs (which is now a searchable property characteristic in our MLS), and I am noticing new construction builders offering options for detached ADUs or attached "multigen" suites -- separate attached units with private entrances, kitchenettes, living space, and private bedrooms/bathrooms. Super cool, and I can tell you these are in demand.

I am so glad to see that Sacramento County and many of the cities withing Sacramento County have not only made the permit/application process easier for ADUs -- they have also created pre-approved design plans!

ADU info in different jurisdictions -- 

• Sacramento County (basically will be any areas within Sacramento County that are not within the city limits -- areas like Antelope, Orangevale, Carmichael, Fair Oaks, parts of areas called Sacramento that aren't in the city limits, etc) -- https://building.saccounty.gov/pages/adu.aspx 
• City of Sacramento -- https://adu.cityofsacramento.org/Shelf-ready-plans 
• City of Citrus Heights -- https://www.citrusheights.net/1108/Permit-Ready-ADU-Program 
• City of Elk Grove -- https://www.elkgrovecity.org/sites/default/files/city-files/Departments/Building/building-forms-and-handouts/over-the-counter-adu-program.pdf 
• City of Folsom -- https://www.folsom.ca.us/government/community-development/housing-services/accessory-dwelling-units
• City of Galt -- https://www.cityofgalt.org/government/community-development/planning/planning-division-forms-handouts
• City of Rancho Cordova -- https://www.cityofranchocordova.org/home/showpublisheddocument/20034/638644999044430000

If you are interested in constructing an ADU, I can point you to a few different builders who have come to specialize in them...or if you are wanting to purchase a resale or new construction home with an ADU, I am happy to assist you. Don't hesitate to reach out.

Quoted in a Sacramento Bee article about the 2020 Sacramento Real Estate Market Forecast...

It's always an honor to be thought of as "an expert" and quoted in articles about our local Sacramento real estate market. This weekend my quotes were featured in an article about next year's 2020 market forecast. It's always interesting to see what others who were asked the same questions say in response and based on quotes from fellow interviewees in the article, it sounds like we are all mostly observing the same things and are on the same page.

While I do not profess to have a crystal ball, as a top producing Realtor and policy geek, I have my finger on the pulse of what is going on and offered a few key points when interviewed.

(1) When asked if the Sacramento real estate market will crash in 2020: NO. I do not believe the Sacramento real estate market will crash in 2020. The end of 2019 has been super busy and spring buying frenzy seems to have arrived early. Sellers - take note. You may want to list your homes a little ahead of schedule. There is not much on the market right now and A LOT of buyers out there home shopping. I think there were many factors that coincided with the market slow down at the end of 2018 that were not present during 2019 - interest rates increased in 2018, ambient smoke and the poor air quality kept many would-be buyers inside, and there was a rhetoric-filled election. In 2019, interest rates significantly declined making mortgages a little more affordable, there was less chaos during fire season, and it has been a non-election cycle. Home price increases in 2019 slightly outpaced inflation and were up a bit, but not drastically so, and overall there seemed to be a more workable balance between buyers and sellers in the market.

(2) When asked if buyers will "show up" in 2020: YES. The buyers are out there and they are motivated. Interest rates remain low, and many predict continued downward pressure on interest rates in 2020 as the global economy sorts out trade wars and reconciles other geopolitical tensions. With rates likely to remain low, I think home buyers will continue to be extremely motivated to buy. I do think home prices will rise in 2020 slightly, probably on a similar trajectory as what we have experienced in 2019. In Sacramento I do see a good amount of new housing inventory coming to market, though unfortunately not enough of it will be at price points targeted at entry-level buyers. There are not enough new homes at the more affordable end of the price spectrum to satisfy that demand. Every little bit of construction helps though. Move-up buyers of new construction homes should still free-up inventory when selling their a smaller homes that entry-level buyers can purchase.

(3) When asked if there will be a recession in 2020: DOUBTFUL. At least not one of much magnitude, if at all. It seems like for probably the last 4-5 years people have expressed concern about a looming recession, as if the decade long economic expansion is destined for a catastrophic end. Our national, state and local economies seem to be humming along right now. And if we were to experience an economic slow-down, I doubt it would be caused by fraudulent lending practices and collapse of our financial system as in 2007. Previous recessions did not have a devastating impact on home values and I doubt values would suffer a collapse of a similar magnitude as we saw in the Great Recession.

(5) When asked about my most "out there" forecast or trend: ADU's! I am optimistic that 2020 becomes the year of the Accessory Dwelling Unit (ADU). Recent legislation has mandated city/county application streamlining and the "by-right" ability of residential property owners to add ADUs to their properties. I hope that MANY homeowners look to construct them. We absolutely need more affordable places for people to live. There are many parcels in greater Sacramento that could easily accommodate ADUs, whether that means converting existing space like a garage or basement to an ADU, or constructing a freestanding ADU Casita in the backyard. We could have thousands of mini-infill projects all over our region adding more housing with affordable rents.

(6) When asked how can more people afford to buy Sacramento homes: IT'S COMPLICATED. In part because a lot of people who want to buy homes can afford to buy homes, but they do not know they can afford it. They do not know enough about the purchase process to know they can qualify for a mortgage. I speak to people all the time who think they must have a 20% downpayment to purchase a home, when in reality there are many downpayment assistance programs available to people with stable employment and decent credit. There are also many low-downpayment programs that require only 3-5% down. In October, the Sacramento Association of REALTORS sponsored an extremely well-attended educational workshop in Oak Park for this purpose. There are other local organizations that promote similar workshops as well.

(7) When asked if Millennials are buying homes: YES. About a third of my transactions this year in 2019 involved a Millennial purchaser, and in my transactions that age bracket seems to represent an increasing number of home buyers. I expect that will continue to trend upward in 2020.

(8) And lastly, when asked about if I see Baby Boomers downsizing: KINDA. I have seen in my own transactions that the Boomers who are selling are relocating out of the area to be closer to family. The boomers who I am working with seem to be making more lateral moves -- with playrooms and bedrooms for the grandkids when they come over. I talk to many other Boomers who would love to downsize and move closer to family, but since they have owned their homes for decades, they face a steep increase in property taxes if they sell their homes and move into another county. Generally those Boomers decide not to sell. If there are reforms in 2020 that allow more Boomers to transfer their property tax base I would expect a significant increase in the number of Boomers who sell and downsize. The California Association of Realtors is currently signature gathering for another ballot initiative that, among other things, would allow for property tax basis transfers for seniors anywhere in the state.

So with all that...I look forward to a great 2020. 2018 lead to an extremely productive and busy 2019, and I believe all that will continue into the new year. Cheers!

Planning to sell a home that one of my buyers may like?

It's mid-February in Sacramento. And, like our seasonal real estate cycles typically predict, it is that wonderful time of the year when home buyers really get motivated to buy, and sellers start to prep their homes for sale...the perfect storm when buyers are ready to go, but there is not quite yet an abundance of housing inventory on the market for buyers to choose from. Which brings me to today's post...do you have a home that you would like to sell that my buyers would like to buy? I am working with some really well-qualified (pre-approved!), amazing people...

Buyer A
Seeking a home in the Arden / Arcade, Carmichael, or Fair Oaks areas. In a perfect world, the property would have 3 bedrooms, 2 bathrooms, 1600sf or larger, a built-in pool, AND an Accessory Dwelling Unit for a multi-generational situation. An ADU is also commonly referred to as a "granny flat", "in-law unit", or "studio". A home with room to add an ADU may also work, or they are also willing to retrofit some existing space to create an ADU. They are pre-approved up to $500,000.

Buyer B
Seeking a home in the Tahoe Park, Tallac Village, Hollywood Park, or surrounding areas. Ideally the property would be a 2 bedroom, 1 bathroom home of 900sf or larger, be pretty turn-key and not need a lot of work, but this buyer would happily do some minor repairs, replace flooring and paint if need be. This buyer is pre-approved up to $335,000.

Buyer C
Seeking a home in the East Sacramento, Land Park, or Midtown Sacramento areas. They would prefer something with architectural character that is walkable. They are down-sizing and a 2 bedroom, 1 bathroom home of 1200sf+ would be great. A second bathroom would be a bonus. Ideally the home has an open layout where the kitchen is open to the living area. A garage is a must, and they'd also love a basement too but that is not required. They are pre-approved up to $600,000.

Buyer D
Seeking a home in the South Land Park, Pocket / Greenhaven, or Little Pocket areas. They would love a 4 bedroom home, but are also fine with a 3 bedroom, 2 bathroom home of at least 1200sf. A half-plex would also be ok too. The house must have a decent-sized yard for their soon-to-be adopted dog. They are pre-approved up to $350,000.

Buyer E
Seeking a newer home (2014 or newer, but not new construction) in Roseville or Rocklin areas at least 4 bedrooms, 2.5 bathrooms, and 2000sf+, and with a good-sized yard (aka, larger than just a patio). They are doing a tax-deferred 1031 Exchange and are all cash buyers. By the rules of their exchange, they need to spend a minimum of $500,000 and a max of $550,000.

So anyway, if you own a home something like what I have described here and are thinking about selling it, drop me a line at erin@erinstumpf.com or 916-342-1372! My buyers would love to hear about it. And if it is not a great fit for one of them, I can help you prep your home for sale and list your home as well.