Current study, which is descriptive-analytical in nature, attempts to identify the strength and weakness of housing sector in Baghdad city as well as offer practical solutions for achieving sustainable development in the housing sector in Iraq. Documental analysis, field research, and interviews with authorities and stakeholders in the housing policy making sector (ministry of construction and housing, and ministry of planning) are used as data collection methods. The SWOT strategic model is used to analyze data collected and the Quantitative Strategic Planning Matrix (QSPM) used to determine appropriate strategies. Eleven external factors that have an impact on the housing sector in Iraq identified and classified to six opportunities factors and five threats factors, in addition to ten internal factors classified to four strength factors and six weakness factors. According to the results of an analysis of those internal and external factors, fifteen strategies are determined and recommended to reduce the housing shortage and step forward to sustainable housing sector.