`It was perfect. It had a fabulous big garden and you could look out the window in the morning and see the Dublin mountains. I thought, `this is just the right spot - we could live here for life'." Thus were Wayne Lakes's first impressions of the dream home which was to become a nightmare.

A day after viewing the show house in Ellensborough Estate, Tallaght, last October he and his wife, Gemma, agreed to buy "off the plans" a similar home for £129,000, handing over a £2,000 deposit.

This week their struggle to complete the purchase finally ended when they were told in the High Court their booking held no legal sway and that the home they thought they had bought would never be theirs. "There was a day when a handshake clinched a deal," says Mr Lakes ruefully, "but these aren't normal days."

Indeed they are not. As house prices continue to spiral upwards to record levels, home purchasers - particularly young and first-time buyers - are becoming increasingly vulnerable to unhealthy market practices. What happened to the Lakes is becoming more common.

"We thought we had everything sorted," says Mr Lakes. "We had our booking deposit and we'd spoken to the mortgage broker and got our finances sorted out. We'd paid an assessor to examine the site maps and plans, but then we got this phone call to say the house was no longer for sale."

That was February 10th, four months af ter the deposit was paid. The construction work was behind schedule and, according to the developer, Durkan New Homes, the cost of materials had risen due to devaluation of the pound against sterling. The Lakeses were told that a further £36,000 would be required for the house.

"I wouldn't take it. I couldn't have faced paying an extra £300 a month for the rest of my life," says Mr Lakes. The couple had al ready made some sacrifices to meet the original price, including cancelling a Christmas holiday to Lanzarote, which would have been their first break since their honeymoon three years ago.

They decided to take the matter to court where they argued the payment of the £2,000 deposit constituted part-performance of a contract, but this week Mr Justice Mc Cracken found against them. While admitting he had "very considerable sympathy" for the couple, he said the booking receipt was not a binding contract.

Theirs was not the first gazumping case to come before the courts. In February a Cork couple won an action against developers who had tried to get out of a deal, returning a £5,000 deposit over a month after it was paid for a £185,000 dwelling. In the Cork Circuit Civil Court, Judge John Buckley held that the couple had an oral contract with Gable Holdings and Clark Homes for the sale of the house. He ordered the completion of the sale for the agreed sum and made the decree against the developers.

Another case is expected before the courts shortly following allegations of gaz umping at a housing development in Trim, Co Meath. Deposits were returned to a number of buyers who had signed contracts which were unsigned by the developer. Unhappy at the developer's actions, the auctioneers handling the estate resigned their services.

According to the Consumer Association of Ireland, few homebuyers whose purchases fall through take legal proceedings as they are afforded little protection in law. In the absence of legal safeguards, the association's chief executive, Ms Caroline Gill, recommends that buyers "read the terms of any deposit or final contract very carefully".

Since the publication of the Bacon report on housing just over two weeks ago, there has been some movement towards introducing regulations which would give greater protection to buyers. The report warned of a number of market practices which were not in the best interests of consumers, including gazumping and the phased release and aggressive release of new developments in an effort to ratchet up prices.

While the report said such practices were not widespread, it was necessary to introduce measures to restrict them. Specifically, it recommended the introduction of a voluntary code of practice as a first step. If the code could not be implemented effectively, it said, consideration should be given to widening the statutory powers of the office of the Director of Consumer Affairs.

In the Dail after this week's case, the Minister of State with responsibility for housing, Mr Robert Molloy, indicated the Government would prefer to go down the non-statutory route. He called on the Irish Homebuilders Association "to give a positive lead in the development of voluntary arrangements" so that the "unsatisfactory and undesirable" situation faced by couples such as Mr and Mrs Lakes would not recur.

It seems developers are finally taking the hint, with the executive committee of the IHBA due to discuss next week the adoption of a voluntary code which incorporates the main areas of concern of the Bacon report.

Mr Michael Goggins, director of the association, which is holding its a.g.m. in Galway this weekend, said he was confident the committee would respond positively to the proposal. "The perceptions that are there among the public aren't doing us any favours." There was little point in having a code of practice "unless breaches of it will result in some kind of penalties. Without pre-empting any decision, one would have to say that the issue of disciplinary measures will have to be looked at."

However, many are sceptical about the effectiveness of any such penalties. The Director of Consumer Affairs, Mr William Fagan, says the association "really has no form of enforcing discipline". He suggests stronger measures may be necessary, including statutory penalties for builders who cannot justify a price increase made after taking a deposit.

"The penalty could be not only to repay the deposit but to refund part of the difference in price. In other words, make them return the unjustified enrichment." While the proposal was "rather draconian", it was better than introducing price controls.

The introduction of greater safeguards, however, would be too late for the Lakeses. Resigned to a future in the small home which they bought five years ago in Tallaght and, says Mr Lakes, was "designed for rental accommodation, not a family", they have decided to stay out of the property market for a while.

"I couldn't face the thought of buying a house now and I can't afford one either. They are all gone. That's the worst thing about it. We could have bought another house in October which was about £25,000 cheaper. Now it's gone up by £40,000 and we can't afford it."

Meanwhile, four miles down the road, their dream home - unlucky-for-some No 13 Ellensborough - still hasn't been built.