POTSDAM, Germany -- When Gabriele and Reiner Krumnow were given the chance in 1990 to buy the house they had been living in for six years, they snapped it up.
"We couldn't believe it. It was something we'd dreamed of for years," said Mrs. Krumnow, 39, a clerk in the Brandenburg state government.
But their luck turned out to be short-lived.
The Krumnows have been told that because they bought their house after a retroactive cutoff date, they and at least 200,000 other homeowners across former East Germany could lose their homes to West Germans who had owned or inherited the property earlier.
With hundreds of thousands of people facing the loss of their homes, experts worry that social upheaval is being stoked by a policy that originally was meant to address unjust land expropriations in Communist East Germany during the 40 years until 1989.
The Krumnows' case is fairly typical. In 1984, they moved into a run-down state-owned house that they had to rent because purchasing a home in Communist East Germany was very difficult.
They treated the house as their own because East German laws had let tenants rent as long as they wanted without running the risk of having to move.
They renovated it, using bartering, cajoling and most of their savings to acquire the wood, radiators, roofing tiles, paint, fixtures and dozens of other items that were nearly impossible to find in East Germany.
Finally, they had a home for themselves and their son, Peter. But, despite several applications, they were never allowed to buy it.
They thought their moment had come when the Communist government fell in October 1989 and a democratic government was elected the next March. New laws were passed, and the Krumnows were among tens of thousands of people who bought their homes.
Those new laws have proved worthless.
Two months after the Krumnows bought their house in June 1990, East Germany and West Germany signed a treaty governing unification. The two sides agreed that anyone who honestly acquired property after Oct. 18, 1989, would have to return it to the original owners and receive a tiny compensation.
The agreement was meant to give the original homeowners a chance to regain land lost to Communist expropriation.
But the handful of East Germans who honestly acquired property before Oct. 18, 1989, would be allowed to keep it, even if the property originally had been expropriated from West Germans.
Many of the homeowners are especially angry at the arbitrary nature of the cutoff date, which government officials say was picked because it was the day hard-line Communist leader Erich Honecker resigned.
Federal Justice Minister Klaus Kinkel wrote in a recent letter to the homeowners that the cutoff date was legitimate because everyone should have had the foresight to realize that once Mr. Honecker was sacked, West Germans would be returning home for their lost land.
Whoever bought after that date, he said, was "not worthy of protection."
The chief targets of the cutoff date were the thousands of top Communists and Stasi secret police officers who misused the new law to acquire luxury homes, said Klaus-Juergen Warnick, head of Brandenburg's wing of the German Tenants' Association.
In fact, such abuses account for only 5 percent to 10 percent of the 200,000 purchases, he said.
"In trying to prevent these people from retaining their property, .. the government has pulled the rug out from under an entire group of legitimate buyers," Mr. Warnick said.
Not only does the treaty require the homeowners to leave, but the compensation it offers is not enough for a new home, Mr. Warnick said.
Under East Germany's system of low land and housing costs, for example, the Krumnows paid only $19,000 for their house. That, plus compensation for their investment in the house, could total about $25,000. But with house prices starting at about $200,000 in the Potsdam-Berlin area, they stand little chance of finding anything else.
If the law stands, the house probably will end up being owned by the great-niece of the original owners, who died in 1945, Potsdam city records indicate.
The serious housing shortage in Germany makes the situation worse, Mr. Warnick said. The country is short at least 2 million apartments, according to public and private estimates, and about 8,000 people are looking for apartments in Potsdam.
If hundreds of thousands of people lose their homes, there could be serious social trouble among eastern Germans, who already are carrying the greatest weight of unification, Mr. Warnick said.
"You can only burden people so much," he said.
Mr. Warnick said the insecurity was so great that more than 1,000 people a week were seeking advice from his organization. In some neighborhoods near West Berlin, more than half of the property has been claimed by former residents.