For owners of singular properties, going to auction has become a way to let the market set the price and to decide exactly when the sale will happen.
By Chris Caggiano
At the top of the real estate market, price matters, but it rarely changes a seller’s life. Time does. That distinction is at the center of how Mario Vargas, CEO and partner at DeCaro Auctions International, explains why a growing number of ultra-high-net-worth owners are choosing to sell at auction. In his view, a seller who sets an auction date is not giving up control of the sale but taking it. Voicing that seller’s reasoning, he puts it plainly: “I’m not going to give it away, but I’m going to make sure that I sell it, and I know exactly when I’m going to sell it, so I can move on with my life.”
That framing may surprise anyone who still links real estate auctions with foreclosures. Vargas has worked in the business for 17 years, and he acknowledges that the association lingers. What has changed is who is willing to look past it.
Once Reserved for Masterpieces
In real estate, the auction’s reputation has lagged well behind its reputation in fine art. No one who owned a Picasso would sell it any other way, Vargas notes. Yet the words “real estate auction” have long prompted people to ask whether a bank owned the property. Early in his career, that suspicion was tangible. Sellers welcomed the idea of a dedicated staff member showing the home every day for five or six weeks. They drew the line at a yard sign announcing the auction, worried that neighbors would conclude they were going bankrupt.
The perception changed gradually. High-profile properties with substantial price tags sold at auction, and the format drew steady coverage in the outlets the wealthy read, from the Robb Report to the Financial Times. Vargas dates the moment he felt the shift to roughly eight years ago, when family offices began calling. “When family offices start to call,” he says, “it’s like, okay, the ultra-wealthy are accepting of it.”
Acceptance, in other words, came from the top of the market down. It rests on a reframing Vargas returns to again and again: for these sellers, an auction is not a distress sale but a business decision.
When There Are No Comps
That business decision makes the most sense for properties that resist conventional pricing. In a typical neighborhood, a home’s value can be read from the sales of similar homes nearby. At the top tier, the comparisons often do not exist. The property may be incomparable, or located in a part of town with no recent sales, or it may have been listed long enough that the asking price is clearly missing the mark. The usual response is to chase the market with a series of price reductions.
An auction reverses that sequence. Rather than guessing at a number, the seller invites competition, and when anywhere from three to twelve qualified buyers bid against one another, Vargas says, the result is “what true market value really is.” Before any of that begins, he meets the seller, analyzes the property, and decides with them whether a reserve or no-reserve format fits best. He also vets the seller’s readiness for the process, because, as he puts it, it is not for everybody.
Readiness, in this case, means accepting that the market rather than the seller will determine the final price. Vargas describes the vetting conversation as a direct one: he shares his assessment of the property and asks whether the seller is prepared to proceed on that basis.
That candor matters because each of the auction’s strengths carries a corresponding risk. The format trades the long exposure of a conventional listing for a compressed marketing period, often just two to four weeks, and its success depends on enough qualified bidders emerging within that window. A seller who sets a reserve the bidding never reaches is back to square one, often after paying significantly out of pocket to fund the auction’s marketing. And a seller whose priority is the highest possible net proceeds, rather than certainty and a fixed date, may do better over the longer term with a conventional pricing strategy. In short, the auction rewards sellers who value a decisive outcome over holding out for a particular number.
What’s Auction-Worthy?
What qualifies as auction-worthy depends heavily on location. Vargas points out that $2.5 million in St. Petersburg, Florida, buys something very different from $2.5 million in Aspen. Still, when agents ask what price point to bring him, he offers $2.5 million as a working rule of thumb and makes adjustments based on the market. Once a property reaches double-digit millions, he adds, it qualifies as luxury regardless of where it sits. The threshold can also be met in aggregate. A group of $750,000 condominiums in the Bahamas, offered together, might appeal to buyers looking for a vacation home or an investment.
Competition works, in part, because taste varies so widely. Much of today’s market favors coastal modern and mountain modern design, which can leave homes with more traditional interiors out of step with the broader pool of buyers. Vargas recalls a property that was, in essence, a log cabin, and it split the room. “Some people walk in and say, ‘Oh my god, I got to fix all of this,'” he says. “And then some people walk in, they’re like, ‘I love it.'” An auction puts both kinds of buyers in competition with each other, and that competition works in the seller’s favor.
Part of the Plan
If competition is what reveals a property’s value, timing is what determines how the auction is perceived. The agents who use auctions most effectively, Vargas says, raise the option at the very first listing appointment. They present it as one more tool to explore if, after 90 or 180 days depending on the season, the market is telling them something different. In his rendering of that conversation, the agent tells the seller directly: “This is not a last resort. This is not a desperation move. This is a business decision.”
The contrast is stark when the timing is reversed. An agent who suggests an auction two weeks before a listing expires, Vargas notes, makes it look like exactly the desperation move sellers fear. The auction itself is identical in both cases. What differs is whether it reads as a plan or a reaction, and that depends entirely on when it enters the conversation.
The reasons agents bring properties to him vary. A seller may have a change in circumstances, a trust to settle, or a selling season running out, as when a Jackson Hole listing approaches the end of its season. In every case, though, the agent stays in place. Vargas says his company has never sold a property without including the listing agent or cutting out buyers’ agents. Early in his career, he would open meetings at brokerages by saying exactly that, and he could watch the agents with folded arms visibly relax. He describes the relationship as a division of expertise: “They’re the real estate experts, and we’re the auction experts.”
Bidding From Anywhere
That partnership with local agents has become more important, not less, as buyers bid from farther away. When Vargas started, every auction was a live event, a white-glove occasion with champagne that he remembers fondly and that also let visiting agents see how the process worked. Some auctions are still held in person. Increasingly, however, buyers bid online or by phone from any time zone. Common in Australia and elsewhere, auctions have become more accepted in the United States over the last few years.
Technology has also changed how buyers evaluate a property before bidding. With virtual tours, Matterport scans, video, and a full due diligence package, a distant buyer can reach the point Vargas describes: “I’ve seen what I need to see. I don’t even need to fly in.” Even so, he insists that local agents must understand the auction process, because buyers bidding from elsewhere will likely turn to a local agent to guide them through the transaction. By the same logic, he has not abandoned traditional marketing. Public relations, print advertising, and even simple directional signage still bring people to the property, while digital platforms extend its reach around the world.
A Share of the Mountain
Having widened the pool of who can bid, the auction format is now widening who can own. DeCaro Auctions recently introduced what it calls a first-of-its-kind dual-track fractional format, drawing on a co-ownership model that has been gaining ground in conventional luxury real estate. A seller can offer a home as a whole property, divide it into eight deeded shares, or sell some of those shares while keeping one or more for personal use, with whole-property and fractional buyers competing in a single auction. Vargas is quick to distinguish the arrangement from a timeshare. Rather than buying weeks, co-owners buy a deeded share of the property itself and split the carrying costs, taxes, and insurance.
The appeal, as Vargas describes it, runs in several directions. An owner who loves a home in Aspen but uses it less than expected could sell fractions of it, keep visiting a few weeks a year, and take some money out of the property. A billionaire who never bought a second or third home, because they knew they would not spend enough time there, might find that owning a share makes sense in Aspen, Tahoe, Telluride, or Cabo. And a buyer who could never afford an $8 million property might well afford a $1 million share of one.
The format also offers an answer for families. When siblings inherit a vacation property, some may want to sell while others want to keep it. Under co-ownership, those who want out can take their share in cash while the others hold on. Vargas sees attorneys, wealth managers, and family offices as natural partners for exactly these situations. He is candid that the format is new and that its future remains to be seen. He places it within a longer arc: Dan DeCaro founded the company more than 40 years ago, and Vargas and his partners, who later bought in, aim to keep the fundamentals that built its reputation while continuing to evolve.
That balance between new structures and old fundamentals brings the story back to the auction’s simplest mechanism, the deadline. A conventional listing sits among all the other listings, Vargas observes. An auction date forces buyers to act, builds competition, and lets them establish what the property is truly worth. Fractional ownership adds new ways to use that deadline, but the premise is unchanged: the seller decides when, and the market decides how much.
About the Expert: Mario Vargas is CEO and Partner of DeCaro Auctions International. Based in Tampa, Florida, he specializes in luxury real estate auctions, and is a member of REALM Global, an international network of real estate professionals working in the ultra-luxury segment.
