Soak the raisins: if you are using raisins, place them in medium sized bowl, pour 1 cup hot water and let soak for 1 hour. If you are not using raisins, skip this step.
Make the bread pudding: Preheat oven to 350F (180C). grease 12-inch (30cm) round baking pan or 13*9-inch (33*22cm) rectangle pan with butter and set aside.
Cut challah bread into 1-inch pieces and spread the pieces into an even layer.
In a large mixing bowl, whisk eggs, milk, sugar, vanilla extract and cinnamon. Pour the mixture over the bread, make sure all the bread is coated. Add soaked raisins and stir to combine. Allow to sit for 15-20 minutes.
Bake for 45-55 minutes, until golden brown.
Make the sauce: in a small sauce pan, whisk sugar, cornstarch and heavy cream. Add the butter and heat until butter melts and the mixture starts to boil. Cook until slightly thickens, turn the heat off and stir in vanilla extract.
Serve warm sauce over the bread pudding and serve!