While the number of foreclosure auctions is steadily increase, many transactions aren't taking place at asking prices because some lenders are demanding too much, brokers and investors say.

Approximately 2.22% of all homes in the U.S., have entered the foreclosure process, according to estimates by the Foreclosures.com .  By the end of the year, it is estimated that one million homes in the U.S. may be in foreclosure.

Many investors, who make up the bulk of active bidders at auctions, say the banks are asking too much for the homes. To date,  46% of foreclosures—have gone into the possession of the banks as real-estate owned, or REOs, because no bidders were interested in them at auction.

With the banks’ inventory piling up as the properties fail to sell, the banks will likely have to discount their prices more in order to unload the homes, real estate experts predict. Such discounts could continue to drive the broader real estate market lower.