To study the structure of the liberalized housing finance market of India and analyze its effect on the Indian housing market. The first section of the paper introduces housing finance markets around the world. The second section of the paper presents a clear picture of the structure, composition, and functioning of housing credit markets in India. The third section of the paper analyses the relationship between housing finance variables such as house disbursements and Interest rates and housing demand variables such as housing sales and Housing demand for a city in India namely; Hyderabad. The last section of the paper will discuss policy initiatives that could help boost the Indian housing and housing finance markets.