SECOND AMENDMENT TO AGREEMENT
                       OF SALE AND PURCHASE



     THIS SECOND AMENDMENT TO AGREEMENT OF SALE AND PURCHASE (this
"Amendment") is entered into effective as of December ___, 1996, by
and between NASHBORO VILLAGE, L.L.C., a Delaware limited liability
company ("Additional Property Seller"), NASHBORO VILLAGE
APARTMENTS, L.P., a Delaware limited partnership ("Seller"), and
WALDEN RESIDENTIAL, INC., a Maryland corporation ("Purchaser").

                         R E C I T A L S:

     A.   Seller and Purchaser entered into that certain Agreement
of Sale and Purchase dated as of November 15, 1996 (the
"Agreement"), as amended by that certain First Amendment to
Agreement of Sale and Purchase executed effective as of
November 25, 1996 (the "First Amendment") pertaining to the sale of
certain property more particularly described therein and commonly
known as the Nashboro Village Apartments, Nashville, Tennessee
("Property").  Unless otherwise defined herein, all words
designated with initial capital letters shall have the meanings as
set forth in the Agreement.

     B.   Purchaser and Seller desire to further amend the
Agreement, and Additional Property Seller desires to join in this
Amendment and in the Agreement as amended hereby, to the extent
that the Agreement as to amended covers the Additional Property and
provides for rights and obligations of Additional Property Seller,
to reflect said parties' agreement regarding certain matters as set
forth below.

     NOW, THEREFORE, for and in consideration of Ten Dollars
($10.00) and other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the undersigned parties
agree as follows:

     1.   ADDITIONAL SELLER.  The introductory paragraph of the
Agreement is hereby amended to add, after the defined term
("Seller"), the following:

          and Nashboro Village, L.L.C., a Delaware limited
          liability company ("Additional Property Seller")

     2.   ADDITIONAL PROPERTY.

          (A)  The Agreement is hereby amended to add a new Section
     1.2, in its entirety as follows:

          1.2  Sale and Purchase.  Additional Property Seller
     agrees to sell and convey unto Purchaser, and Purchaser agrees
     to purchase and accept from Additional Property Seller, for
     the price and subject to the terms, covenants, conditions and
     provisions herein set forth, the following:

          (a)  All of that certain land (the "Additional Land") in
     Nashville, Tennessee, being more particularly described on
     Exhibit "A-1" attached hereto and incorporated herein by this
     reference for all purposes;

          (b)  All right, title and interest of Additional Property
     Seller in and to all structures, improvements and fixtures
     (collectively, "Additional Improvements") located on the
     Additional Land.  The Additional Land and the Additional
     Improvements are sometimes referred to herein collectively as
     the "Additional Real Property", and consist primarily of a
     tennis facility, marketing center and undeveloped land.

          (c)  All right, title and interest of Additional Property
     Seller, if any, in and to any land lying in the bed of any
     street, road or access way, opened or proposed, in front of,
     at a side of or adjoining the Additional Land to the
     centerline thereof ("Additional Property Rights");

          (d)  All right, title and interest of Additional Property
     Seller, reversionary or otherwise, in and to all easements in
     or upon the Additional Land and all other rights and
     appurtenances belonging or in anywise pertaining thereto, if
     any ("Additional Appurtenances");

          (e)  All furniture, carpeting, draperies, appliances,
     building supplies, equipment, machinery, inventory and other
     items of personal property owned by Seller and presently
     affixed or attached to, placed or situated upon the Additional
     Real Property and used solely in connection with the
     ownership, operation and occupancy of the Additional Real
     Property ("Additional Personalty"), but specifically excluding
     property owned by third parties and leased to Additional
     Property Seller;

          (f)  Additional Property Seller's interest in all
     assignable leasing, service, supply and maintenance contracts
     relating solely to the Additional Real Property or Additional
     Personalty ("Additional Contracts"); and

          (g)  All right, title and interest of Seller, in any, in
     and to all intangible property relating solely to the
     ownership or operation of the Additional Real Property or
     Additional Personalty, in each case only to the extent
     assignable, including licenses, permits, guaranties,
     warranties and trade names, if any, but in each case without
     warranty, including right to use the name "Nashboro Village"
     on a non-exclusive basis ("Additional Intangible Property").

     The items described in (a) through (g) of this Section 1.2 are
     hereinafter collectively called the "Additional Property".

          (B)  Except for Articles IV, V, VI and Sections 7.2(a),
     7.2(b), 7.2(c), 7.3(e) and 7.2(f) of the Agreement, the
     Agreement is also hereby amended to additionally insert the
     corresponding defined terms relative to the Additional
     Property (from new Section 1.2(a) as provided for above),
     where appropriate, at every place where a defined term
     relative to the Property occurs in the Agreement, so that such
     provisions of the Agreement will also apply to the Additional
     Property and its various component parts.

          (C)  The Agreement is also hereby amended to attach and
     incorporate  Exhibit "A-1" attached hereto (describing the
     Additional Land).

     3.   PURCHASE PRICE.  Section 2.1 is hereby amended to reflect
an aggregate Purchase Price for the Property and the Additional
Property of Forty-Eight Million Eight-Hundred Thousand and No/100
Dollars ($48,800,000.00).

     4.   ADDITIONAL PROPERTY CLOSING.

          (A)  Section 7.1 of the Agreement is amended to change
     the Closing Date to 1:00 p.m. Central Time on December 16,
     1996.

          (B)  Article VII is also hereby amended to add to the
     Agreement new Sections 7.5 and 7.6, in their entirety as
     follows:

          Section 7.5    Additional Property Closing for Additional
          Property.

          (a)  If on the Closing Data Purchaser has not reviewed
     the title and a survey of the Additional Property as described
     in Section 7.5(c) below, the Closing with respect to the
     Property shall occur, and the portion of the Closing
     consisting of the sale and purchase of the Additional Property
     (the "Additional Property Closing") shall be deferred;
     provided, however, that the Additional Property Closing shall
     occur in all cases on or before 1:00 p.m. Central Time on
     December 31, 1996 ("Additional Property Closing Deadline").

          (b)  If the Additional Property Closing is postponed as
     provided for immediately preceding Section 7.5(a), then Two
     Million Eight Hundred Thousand and No/100 Dollars
     ($2,800,000.00) ("Additional Property Escrow") shall be
     withheld from the Purchase Price to be paid by Purchaser on
     the Closing Date, and shall be held in escrow by the Title
     Company pending the Additional Property Closing on the same
     terms as the Earnest Money Deposit is held, as set forth in
     Section 2.2(b) of the Agreement.

          (c)  As soon as practicably following the date of this
     Amendment, Seller shall at Seller's sole cost and expense
     deliver to Purchaser (i) an update of the most recent survey
     of the Additional Real Property ("Additional Property
     Survey"), additionally showing Tract 4B as described in
     Section 10.16 below and containing a certificate substantially
     in accordance with the form attached hereto as Exhibit "G";
     (ii) a title commitment ("Additional Property Commitment") by
     the terms of which the Title Company agrees to issue to
     Purchaser an owner policy of title insurance ("Additional
     Property Title Policy") for the Additional Property in
     accordance with Section 5.1(a) of this Agreement; and (iii)
     photocopies of all documents ("Additional Property Title
     Documents") referenced or described in the exceptions shown on
     the Additional Property Commitment.

          (d)  At the Additional Property Closing, Additional
     Property Seller shall:

          (i)  Cause the Title Company to modify (by interlineation
     or otherwise) the Additional Property Commitment to reflect
     the "Additional Property Permitted Exceptions" (defined as the
     Permitted Exceptions as defined in Section 5.1(b) of this
     Agreement, to the extent the same affect the Additional Real
     Property, and any additional matters of record, which matters
     should be reflected on the Additional Property Survey or the
     Additional Property Commitment and shall be approved by
     Purchaser);

          (ii) To the extent available and in Seller's possession
     or control, deliver originals of all Additional Contracts
     affecting the Additional Real Property either at Additional
     Property Closing or by making same available at the Additional
     Property;

          (iii)     Deliver possession of the Additional Property,
     subject to the Additional Property Permitted Exceptions, the
     rights of parties in possession and all rights and obligations
     under the Additional Contracts;

          (iv) To the extent available and in Seller's possession,
     deliver copies of all necessary permits issued by appropriate
     governmental authorities and utility companies relating to the
     Additional Property;

          (v)  Execute, acknowledge and deliver a special warranty
     deed ("Additional Deed") in the form attached hereto as
     Exhibit "T", conveying the Additional Real Property;

          (vi) Execute, acknowledge and deliver a bill of sale,
     assignment and assumption ("Additional Bill of Sale") in the
     form attached hereto as Exhibit "J", conveying without
     warranty the Additional Personalty and assigning Additional
     Property Seller's interest in the Additional Intangible
     Property and the Additional Contracts;

          (vii)     Delivery evidence of its authority to execute
     the Additional Deed and the Additional Bill of Sale;

          (viii)    Deliver a non-foreign entity certification in
     the form attached hereto as Exhibit "K", certifying in
     compliance with Section 1445 of the Internal Revenue Code of
     1986, as amended, and the regulations promulgated thereunder
     that Additional Property Seller is not a "foreign person";

          (ix) Deliver an affidavit or certificate reasonably
     requested by the Title Company in connection with its issuance
     of the Additional Property Title Policy; and

          (x)  Deliver the restrictions relating to Tract 4B, as
     more particularly described in Section 10.16(b)(i) herein.

          (xi) Delivery such other documents as may be reasonably
     requested by Purchaser (including an audit letter in the form
     attached hereto as Exhibit "B-1") or Title Company, including
     transfer tax affidavits and evidence of authority to sell the
     Additional property in accordance with this Agreement.

          (e)  At the Additional Property Closing, Purchaser shall:

          (i)  Authorize the Title Company to release the
     Additional Property Escrow funds to Additional Property
     Seller;

          (ii) Execute and deliver such documents as may be
     reasonably required by Additional Property Seller or Title
     Company, including but not limited to, a certified copy of a
     resolution of the Board of Directors of Purchaser (if a
     corporation) authorizing Purchaser to consummate the purchase
     of the Additional Property and designating those persons
     authorized to execute and deliver all necessary documents at
     the Additional Property Closing;

          (iii)     Deliver (A) Certificates of Good Standing and
     Corporate Existence of Purchaser, and (B) copies of any and
     all of the documents evidencing the corporate structure of
     Purchaser which Additional Property Seller reasonably may
     request;

          (iv) Execute and deliver the Additional Bill of Sale,
     assuming the obligations under the Additional Contracts from
     and after Additional Property Closing and the obligation,
     whether arising before or after Additional Property Closing,
     relating to the physical or environmental condition of the
     Additional Property;

          (v)  As the Additional Property Closing, Purchaser and
     Seller shall execute and deliver an Additional Closing
     Statement setting forth the amount held in the Additional
     Property Escrow and all prorations, adjustments and credits
     thereto and, if necessary, a post-closing agreement for the
     Additional Property Closing, with respect to any adjustment
     based on the estimates that are to be readjusted after the
     Additional Property Closing

          (f)  At the Additional Property Closing, prorations shall
     be governed by Section 7.2(d) of this Agreement, and the
     allocation of costs for the Additional Property Closing shall
     be governed by Section 7.3.

          (g)  Purchaser agrees to assume and perform (i) all of
     the covenants of Additional Property Seller and Additional
     Property Seller's predecessor in title pursuant to the
     Additional Contacts, which are performable subsequent to the
     Additional Property Closing Date, and (ii) all obligations,
     whether arising before or after the Additional Property
     Closing Date, relating to the physical or environmental
     condition of the Additional Property.  Purchaser indemnifies
     and holds Seller harmless from and against any and all claims,
     costs and expenses (including reasonable attorneys' fees)
     asserted against or incurred by Additional property Seller and
     arising out of the failure of Purchaser to perform its
     obligations pursuant to this Section 7.6(f).  The provisions
     of this Section 7.5(f) shall survive the Additional Property
     Closing.

     Section 7.6 Additional Property Remedies.  In the event that
Additional Property Seller is unwilling to unable to convey the
Additional property in accordance herewith by the Additional
Property Closing Deadlines, Purchaser may elect, as its sole
remedy, either to: (i) terminate its obligation to purchase the
Additional Property by giving Additional Property Seller timely
written notice of such election, and upon such termination
Purchaser shall be entitled to the return of the Additional
property Escrow; or (ii) pursue specific performance of its right
to acquire the Additional property under the terms of this
Agreement.  In the event that Purchaser is unwilling or unable to
close on the Additional Property in accordance herewith by the
Additional Property Closing Deadline, Additional Property Seller's
sole remedy shall be to recover from the Additional Property
Escrow, and the Title Company shall disburse to Additional Property
Seller from the Additional Property Escrow, liquidated damages in
the amount of Two Hundred Thousand and No/100 Dollars ($200,000). 
The parties hereby agree that such liquidated damages amount
represents the parties' agreed best estimate of the damages which
will result to Additional Property Seller from any such default by
Purchaser, which damages are subjective in nature and difficulty to
ascertain.  The balance of the Additional Property Escrow remaining
after payment of such liquidated damages shall be returned and
disbursed by the Title Company to Purchaser.
     5.   SPECIAL PROVISIONS.  The Agreement is hereby amended to
add new Section 10.16, in its entirety as follows:

     Section 10.16  Special Provisions.  The following special
provisions shall survive the Closing and the Additional Property
Closing, and shall be evidenced of record by a memorandum to be
executed by Additional Property Seller and Purchaser and filed of
record against the Property, Additional Property, Tract 28 and
Tract 4B:

          (a)  Tract 28.

          (i)  Rezoning.  Purchaser acknowledges that Additional
     Property Seller intends that Tract 28 of Nashboro Village
     ("Tract 28"), as more particularly described on the Survey
     dated November 26, 1996 prepared by Wamble & Associates (the
     "Existing Survey"), and to be shown on the Additional Property
     Survey, be rezoned for commercial use as a commercial planned
     unit development ("Commercial PUD") which shall not permit
     industrial or light industrial uses.  In connection with the
     Commercial PUD, Purchaser hereby agrees not to object to any
     application made by Additional Property Seller or other party
     for the Commercial PUD.

          (ii) Other Development.  In the event that Tract 28 is
     not rezoned as a Commercial PUD, Purchaser acknowledges and
     agrees that Additional Property Seller may itself develop
     Tract 28 as a multi-family apartment project, or subject to
     Section 10.16(a)(iii) below sell Tract 28 to a buyer who plans
     to develop Tract 28 as a multi-family apartment project.  In
     connection with the development of Tract 28 as a multi-family
     apartment project, Purchaser hereby agrees that Tract 28 shall
     have such development rights as necessary out of the rights
     available under the applicable Planned Unit Development so as
     to allow for development of Tract 28 with a unit density of at
     least 135 units or ten units per acre.

          (iii)     Right of First Offer.  If Additional Property
     Seller desires to sell Tract 28 for an amount (the "Proposed
     Offer Price") of less than One Dollar and 56/100 ($1.56)
     p.s.f., Additional Property Seller shall first offer to sell
     Tract 28 to Purchaser by providing to Purchaser written notice
     (the "Offer Notice") of all material terms of such sale,
     including but not limited to the Proposed Offer Price. 
     Purchaser shall within ten (10) days from receipt by Purchaser
     of the Offer Notice (the "Acceptance Period") provide to
     Additional Property Seller written notice  (the "Acceptance
     Notice") of Purchaser's acceptance of such offer and intention
     to purchase Tract 28 on the terms and conditions set forth in
     the Offer Notice.  If Additional Property Seller received the
     Acceptance Notice within the Acceptance Period, Additional
     Property Seller shall be obligated to sell Tract 28 to
     Purchaser on the terms and conditions set forth in the Offer
     Notice, and Purchaser shall be obligated to purchase Tract 28
     on the terms and conditions set forth in the Offer Notice,
     including but not limited to the Proposed Offer Price. 
     Purchaser shall pay the Proposed Offer Price in cash at
     closing, and closing of Purchaser's acquisition of Tract 28
     pursuant to the Offer Notice will occur within thirty (30)
     days following Additional Property Seller's receipt of the
     Acceptance Notice.  If Purchaser fails to deliver the
     Acceptance Notice within the Acceptance Period, Additional
     Property Seller may, for one (1) year following the expiration
     of the Acceptance Period, sell Tract 28 to a third party for
     a price equal to or greater than ninety-five percent (95%) of
     the Proposed Offer Price.  Upon closing of such sale to a
     third party within such 1-year period, Purchaser's right of
     first offer as provided for in this subsection shall
     terminate.  Failing such sale within such 1-year period,
     Purchaser's right of first offer as provided for in this
     subsection shall again be effective on the same terms and
     conditions as set forth herein.

          (b)  Tract 4B.

          (i)  Conveyance to Purchaser.  Purchaser acknowledges
     that Tract 4B of Nashboro Village, as more particularly
     described on the Existing Survey and to be shown on the
     Additional Property Survey ("Tract 4B") is not included as a
     part of the Property or the Additional Property to be
     purchased by Purchaser pursuant to this Agreement .  Purchaser
     and Additional Property Seller hereby acknowledge that in
     connection with obtaining the Commercial PUD for Tract 28,
     Additional Property Seller may relocate a certain existing
     historical homesite (the "Homesite") from Tract 28 to Tract
     4B.  If the Homesite is to be relocated to Tract 4B,
     Additional Property Seller shall convey Tract 4B in its
     entirety to the appropriate historical society, municipal
     authority, governmental entity, neighborhood or homeowners'
     association or other non-profit organization or entity, with
     the understanding that Tract 4B will be held and maintained
     for public, community or neighborhood purposes.  Such
     conveyance will be only by a deed containing restrictions
     mutually acceptable to Additional Property Seller and
     Purchaser.  In the event that Additional Property Seller sells
     Tract 28 and retains ownership of Tract 4B, Additional
     Property Seller shall convey Tract 4B to Purchaser for no
     further consideration beyond the Purchaser Price to be paid by
     Purchaser hereunder.

          (ii) Boat Storage.  Purchaser hereby agrees that within
     thirty (30) days after the Closing for the Property, it will
     notify its Tenants to remove and relocate any and all items of
     personality stored by such Tenants in the boat storage
     facility located on Tract 4B (the "Boat Storage Facility"), 
     Purchaser hereby indemnifies and holds Seller harmless from
     any claims after the closing for the Property arising as a
     result of or relating to the use by Purchaser's Tenants of the
     Boat Storage Facility, including but not  limited to incidents
     arising from or as the result of the removal of personalty
     therefrom.  Purchaser shall use its best efforts to enforce
     the timely removal from the Boat Storage Facility of all
     personalty belonging to the Tenants, and within sixty (60)
     days after expiration of the above-specified 30-day period,
     Purchaser shall seek to enforce all remedies available under
     any storage agreements applicable to the Boat Storage
     Facility.

          (c)  Sales Center Interim Lease.  In the event that the
     Additional Property Closing is postponed as provided for in
     Section 7.5(a) of this Agreement, in return for the
     consideration to be paid by Purchaser and Seller and
     Additional Property Seller hereunder, Additional Property
     Seller hereby leases to Purchaser on an interim basis a
     portion of that certain information center located on Tract 29
     of Nashboro Village, as said Tract 29 and said information
     center are more particularly described and shown on the
     Existing Survey and will be shown on the Additional Property
     Survey (the "Premises"), on the following terms and
     conditions:

          (i)  Term.  The lease of the Premises to Purchaser shall
     commence upon the Closing for the Property and shall terminate
     on the earlier to occur of (A) the Additional Property Closing
     or (B) December 31, 1996;

          (ii) Use.  Purchaser shall be entitled to use the
     Premises only as an information center and leasing office for
     the Property, and such use by Purchaser will be subject to (A)
     Additional Property Seller's right to leave in place on the
     Premises all of Additional property Seller's documents and
     records and other personal property, furnishings and equipment
     currently situated on the Premises and (B) a right of
     Additional Property Seller, its employees, contractors,
     customers, clients and invitees to go on the Premises from
     time to time and to have access to and use Additional Property
     Seller, its employee, contractors, customers, clients and
     invitees to go on the Premises from time to time and to have
     access to and use Additional Property Seller's documents and
     records and other personal property, furnishings and equipment
     on the Premises; and

          (iii)     Indemnification.  Purchaser hereby indemnifies
     and holds harmless Additional Property Seller from and against
     any and all claims and liability of any kind whatsoever
     relating to or arising out of the Premises, Purchaser's use,
     operation and maintenance of the Premises or activities on the
     Premises by Purchaser's employees, contractors, customers,
     clients and invitees, except to the extent any such claims or
     liability arise out of Additional property Seller's use,
     operation and maintenance of the Premises, or activities on
     the Premises by Additional Property Seller's employees,
     contractors, customers, clients and invitees.

<PAGE>
     EXECUTED as of the date set forth on the first page hereof.

                              "SELLER"
                              
                              NASHBORO VILLAGE APARTMENTS, L.P.,
                              a Delaware limited partnership
                              
                              By:  NVA, INC., a Delaware
                                   corporation, General Partner
                              
                              
                              
                              By:  ______________________________
                                   Name:  _______________________
                                   Title: _______________________
                              
                              
                              "PURCHASER"
                              
                              WALDEN RESIDENTIAL PROPERTIES, INC.,
                              a Maryland corporation
                              
                              
                              By:  ______________________________
                                   Name:  _______________________
                                   Title: _______________________
                              
                              
                              "ADDITIONAL PROPERTY SELLER"
                              
                              NASHBORO VILLAGE, L.L.C.,
                              a Delaware limited liability company
                              
                              
                              
                              By:  ______________________________
                                   Name:  _______________________
                                   Title: _______________________