Your agent works for you and should know what is going on with the properties you have written offers on. You should definitely keep looking, even if the owner has accepted your offier. You don't have a deal until the bank approves it and you could miss out on some great homes waiting for something that may or may not happen.
I don't mean to be judgemental, but it doesn't sound like your current agent has much experience with short sales. If you are interested in these properties, it is best to find an agent that understands them, so that you have the best possible chance of getting what you want.
If you have any additional concerns or questions, please feel free to contact me directly.
I had a buyer with an offer in a short sale, and it was also auctioned, even though our offer was strong - and all cash. When a short sale offer is accepted by the owner, that's just the beginning - the lender has to approve the short sale in writing, and that's the longest part of the process. In my case the listing agent had no idea the property was even auctioned, in fact he was told that we were in first position of the competing offers - so he was communicating with the lender, and it still happened. No agent can control what a bank is going to do, and no buyer's agent can control who gets an accepted offer on an REO. There are definitely ways to make sure your offer is the strongest, and not just in price, that's ultimately up to the asset manager with the lender.
When I show short sales and write offer for them, I still encourage my buyers to keep looking. Roughly, only two to three short sales out of five ever even close, so you HAVE to keep looking. You can't put all your eggs in one iffy basket.
And when this home does come back on the market as an REO, you can bet it will get offers. REO's get more offers than short sales because they can close much quicker, like a regular sale.
If your agent won't show you other homes, just find another agent who understands better. If you signed a buyer-broker agreement, talk to the agent's broker and request a new agent.
While this home will return to the market it can sometimes take weeks or months for that to happen. The bank must deal with the occupant, if any, have the home cleaned out and evaluated., then clear up any potential title issues before they list and market the property. While that can go quickly, it often does not. I recommend you keep looking and have your agent monitor that home to determine when and at what price it will become available.
Perhaps your agent doesn't know that the property sold at auction. If you show her proof that the house has sold at auction, maybe then she'll be ready to show you more property.
Or, maybe when you placed the offer on the property it was a short sale. Since then the bank has taken it back, and it may be coming on the market as an REO. In this case your agent may believe that he/she can get you the property once the bank owns it.
Just make sure that you are communicating with your agent, becomes sometimes agents don't have all the information. And if the agent is unwilling to explain something to your satisfaction, then I would recommend finding a new agent.