When you make an offer on a house that needs work, it really only makes sense if you can do the work yourself. You don't mention who would do the work if you were to buy these properties.
Since your agent knows your situation much better than I do, he may very well have a good reason for being concerned. I am sure he does not want you to end up in the same situation that these owners finding themselves.
In general, foreclosure purchases should be apprached with caution because oftentimes the properties are in rough condition. In the case of those two houses, it sounds like perhaps they are not yet bank owned so that you would at least get disclosures from the current owners. It is also possible that these are short sales which means that the owners owe more money than what the properties are worth in the current market. If that's the case, any offers would have to be approved by the lender(s) and these days that can take 3 months or more. It sounds like your agent has your best interest at heart and you should listen to him.
If you proceed, do it with caution. Your REALTOR probably has good instincts and I would listen to his / her advice. If you proceed, I would be sure to make the contract contingent on having a home insprction, and maybe even an engineering assessment. If it is in forclosure, or going into forclosure, it will no doubt be sold "as is". But you should at least be able to have those inspections for a recision right. Did the previous owners ever have permits issued for those unfinished renovations ? Just a thought.