The government's plan to force home sellers to use home information packs was defeated in the House of Lords yesterday, to the dismay of campaigners for change in the way homes are marketed.

A Conservative amendment to the housing bill now makes the home information packs voluntary instead of compulsory as the government had wanted.

The opposition amendment was backed by peers who voted by 179 votes to 132 to defeat the plan and accept the amendment that the government had said was unworkable.

Housing minister, Lord Rooker had said that the packs would not be introduced until after extensive consultations and pilot studies.

However, he conceded that if the system did not work it would annoy people, but he believed that there was an urgent need to improve the way the market operated.

"Buying and selling homes drives people to distraction," Lord Rooker said. "All the evidence suggests that buyers and sellers are unhappy with the way properties are bought and sold."

Lord Hanningfield, Conservative spokesman in the Lords, said the amendment was a sensible step forward. "In choosing this approach we are leaving it completely to the discretion of home owners to judge the merits of the packs and to decide whether commissioning one will assist them in the property market," he said. "This is a proper championing of consumer rights rather than forcing them into such a scheme unwillingly."

But Keith Hill said: "Home information packs are a key to a range of new Government initiatives aimed at improving the housing market efficiency."

"Voluntary packs will simply not work. The consumer deserves more than being left in a home-buying selling system that does not operate effectively or offer any form of redress."

The Royal Institution of Chartered Surveyors (RICS) said this morning it was very disappointed about the peer's decision.

There are many, many reasons why the packs should be mandatory, the surveyors said. The system cannot work as a voluntary, two-tier system.

The government is committed to a 2007 start date, a date, which may now be under threat. RICS has worked on the project since in began in 1999 and says it will continue to campaign for its introduction.