Housing finance companies in India are playing a pivotal role in development of housing sector and allied sectors and it is often viewed as growth engines. Housing sector is of paramount importance to the economy of the country with regard to the investment and employment generation. The financial effectiveness of housing finance companies is the backbone of Indian housing sector. House construction activity stimulates and gives a boost to investment and production in a host of other industries which provide essential inputs for construction activity. After agriculture, the Housing Industry is the second largest employment generator in the country. It is estimated that the budgeted 2 million units would lead to the creation of an additional 10 million man-years of direct employment and another 15 million man-years of indirect employment. The construction sector ranks 4th among 14 sectors in terms of backward linkage and 3rd in terms of total linkage effect with other sectors of the economy in India.HDFC was setup in 1977 at the initiative of ICICI and His Royal Highness the Aga Khan and International Finance Corporation, Washington (IFC).