FORM 10-QSB--QUARTERLY OR TRANSITIONAL REPORT UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                        Quarterly or Transitional Report

                     U.S. Securities and Exchange Commission
                             Washington, D.C. 20549

                                   Form 10-QSB

(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

                   For the quarterly period ended March 31, 2000


[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934


                For the transition period from _________to _________

                         Commission file number 0-13454

                           NATIONAL PROPERTY INVESTORS 7
         (Exact name of small business issuer as specified in its charter)



         California                                         13-3230613
(State or other jurisdiction of                          (I.R.S. Employer
 incorporation or organization)                         Identification No.)

                     55 Beattie Place, Post Office Box 1089
                        Greenville, South Carolina 29602
                      (Address of principal executive offices)

                                 (864) 239-1000
                           (Issuer's telephone number)

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days. Yes X No___

<PAGE>


                         PART I - FINANCIAL INFORMATION

ITEM 1.     FINANCIAL STATEMENTS

a)

                           NATIONAL PROPERTY INVESTORS 7

                                  BALANCE SHEET

                                   (Unaudited)

                        (in thousands, except per unit data)

                                 March 31, 2000
<TABLE>
<CAPTION>

Assets
<S>                                                                         <C>
   Cash and cash equivalents                                                $ 1,876
   Receivables and deposits                                                     124
   Restricted escrows                                                           458
   Other assets                                                                 517
   Investment properties:
       Land                                                  $  3,738
       Buildings and related personal property                 43,580
                                                               47,318
       Less accumulated depreciation                          (28,069)       19,249
                                                                           $ 22,224

Liabilities and Partners' (Deficit) Capital
Liabilities
   Accounts payable                                                          $  107
   Tenant security deposit liabilities                                          103
   Accrued property taxes                                                        85
   Other liabilities                                                            273
   Mortgage notes payable                                                    21,010

Partners' (Deficit) Capital:
   General partner                                            $  (296)
   Limited partners (60,517 units
      issued and outstanding)                                     942           646
                                                                           $ 22,224
</TABLE>

                   See Accompanying Notes to Financial Statements


<PAGE>

b)

                           NATIONAL PROPERTY INVESTORS 7

                            STATEMENTS OF OPERATIONS

                                   (Unaudited)

                        (in thousands, except per unit data)


<TABLE>
<CAPTION>

                                                               Three Months Ended
                                                                   March 31,
                                                               2000          1999
Revenues:
<S>                                                           <C>           <C>
   Rental income                                              $1,751        $1,813
   Other income                                                   73            64
       Total revenues                                          1,824         1,877

Expenses:
   Operating                                                     704           716
   General and administrative                                     91            71
   Depreciation                                                  484           432
   Interest                                                      420           409
   Property taxes                                                106           110
       Total expenses                                          1,805         1,738

Net income                                                     $  19         $ 139

Net income allocated to general partner (1%)                   $  --           $ 1

Net income allocated to limited partners (99%)                    19           138

                                                               $  19         $ 139

Net income per limited partnership unit                       $ 0.31        $ 2.28

Distributions per limited partnership unit                    $19.96        $ 4.91
</TABLE>


                   See Accompanying Notes to Financial Statements

<PAGE>

c)

                           NATIONAL PROPERTY INVESTORS 7

                STATEMENT OF CHANGES IN PARTNERS' (DEFICIT) CAPITAL
                                   (Unaudited)

                        (in thousands, except per unit data)

<TABLE>
<CAPTION>

                                     Limited
                                   Partnership    General     Limited
                                      Units       Partner     Partners      Total

<S>                                   <C>         <C>         <C>          <C>
Original capital contributions        60,517      $    1      $30,259      $30,260

Partners' (deficit) capital at
   December 31, 1999                  60,517      $ (284)     $ 2,131      $ 1,847

Distribution to partners                  --         (12)      (1,208)      (1,220)

Net income for the three months
   ended March 31, 2000                   --          --           19           19

Partners' (deficit) capital
   at March 31, 2000                  60,517      $ (296)       $ 942        $ 646
</TABLE>

                   See Accompanying Notes to Financial Statements

<PAGE>

d)

                           NATIONAL PROPERTY INVESTORS 7

                            STATEMENTS OF CASH FLOWS

                                   (Unaudited)

                                 (in thousands)

<TABLE>
<CAPTION>

                                                                 Three Months Ended
                                                                      March 31,
                                                                   2000        1999
Cash flows from operating activities:
<S>                                                               <C>          <C>
  Net income                                                      $  19        $ 139
  Adjustments to reconcile net income to net cash
    provided by operating activities:
    Depreciation                                                    484          432
    Amortization of loan costs                                       28           28
    Change in accounts:
      Receivables and deposits                                      213           97
      Other assets                                                  (23)         (32)
      Accounts payable                                              (59)           2
      Tenant security deposit liabilities                            (4)          (5)
      Accrued property taxes                                         18          (94)
      Other liabilities                                             (28)           8

       Net cash provided by operating activities                    648          575

Cash flows from investing activities:
  Property improvements and replacements                           (303)         (91)
  Net deposits to restricted escrows                                (11)         (24)

       Net cash used in investing activities                       (314)        (115)

Cash flows from financing activities:
  Payments on mortgage note payable                                 (15)         (10)
  Loan costs paid                                                   (16)          --
  Distributions to partners                                      (1,220)        (300)

       Net cash used in financing activities                     (1,251)        (310)

Net (decrease) increase in cash and cash equivalents               (917)         150

Cash and cash equivalents at beginning of period                  2,793        1,074

Cash and cash equivalents at end of period                      $ 1,876      $ 1,224

Supplemental disclosure of cash flow information:
  Cash paid for interest                                         $ 334        $ 382
</TABLE>

                   See Accompanying Notes to Financial Statements

<PAGE>

e)

                           NATIONAL PROPERTY INVESTORS 7

                          NOTES TO FINANCIAL STATEMENTS

                                   (Unaudited)

Note A - Basis of Presentation

The accompanying unaudited financial statements of National Property Investors 7
(the  "Partnership"  or  "Registrant")  have been  prepared in  accordance  with
generally accepted accounting  principles for interim financial  information and
with  the  instructions  to Form  10-QSB  and Item  310(b)  of  Regulation  S-B.
Accordingly,  they do not include all of the information and footnotes  required
by generally accepted accounting  principles for complete financial  statements.
In the opinion of NPI Equity  Investments,  Inc. (the "Managing General Partner"
or "NPI Equity"),  all  adjustments  (consisting of normal  recurring  accruals)
considered  necessary  for a fair  presentation  have been  included.  Operating
results for the three  month  period  ended  March 31, 2000 are not  necessarily
indicative  of the  results  that may be  expected  for the fiscal  year  ending
December 31, 2000. For further  information,  refer to the financial  statements
and footnotes thereto included in the Partnership's Annual Report on Form 10-KSB
for the year ended December 31, 1999.

Note B - Transfer of Control

Pursuant  to a series  of  transactions  which  closed  on  October  1, 1998 and
February 26, 1999,  Insignia Financial Group, Inc. and Insignia Properties Trust
merged into Apartment  Investment and Management Company  ("AIMCO"),  a publicly
traded real estate investment trust, with AIMCO being the surviving  corporation
(the "Insignia Merger").  As a result, AIMCO acquired 100% ownership interest in
the Managing General Partner. The Managing General Partner does not believe that
this  transaction  has had or will have a  material  effect on the  affairs  and
operations of the Partnership.

Note C - Transactions with Affiliated Parties

The  Partnership  has no employees  and is  dependent  on the  Managing  General
Partner  and  its  affiliates  for  the  management  and  administration  of all
Partnership  activities.  The  Partnership  Agreement  provides  for payments to
affiliates for services and as  reimbursement  of certain  expenses  incurred by
affiliates on behalf of the Partnership.

The  following  payments  were  made to the  Managing  General  Partner  and its
affiliates during the three month periods ended March 31, 2000 and 1999:

                                                                  2000      1999
                                                                  (in thousands)

 Property management fees (included in operating expenses)        $ 90      $ 96
 Reimbursement for services of affiliates (included in
   investment properties and general and administrative
   expenses)                                                        43        44
 Non-accountable reimbursement (included in general and
   administrative expenses)                                         30        --

During  the three  months  ended  March 31,  2000 and  1999,  affiliates  of the
Managing  General Partner were entitled to receive 5% of gross receipts from all
of  the  Partnership's   properties  as  compensation  for  providing   property
management  services.  The  Registrant  paid  to such  affiliates  approximately
$90,000  and  $96,000  for the  three  months  ended  March  31,  2000 and 1999,
respectively.

<PAGE>

An  affiliate  of  the  Managing  General  Partner  received   reimbursement  of
accountable  administrative  expenses  amounting  to  approximately  $43,000 and
$44,000 for the three months ended March 31, 2000 and 1999, respectively.

For services relating to the  administration of the Partnership and operation of
Partnership  properties,  the  Managing  General  Partner is entitled to receive
payment for  non-accountable  expenses up to a maximum of $150,000 per year from
distributions from operations,  based upon the number of Partnership units sold,
subject  to  certain   limitations.   The  Managing   General  Partner  received
approximately  $30,000 in  reimbursements  for the three  months ended March 31,
2000.  The  Managing  General  Partner  was not  entitled  to  receive a similar
reimbursement during the three months ended March 31, 1999 because there were no
distributions from operations.

The Managing General Partner has extended to the Partnership a line of credit of
up to $500,000.  Loans under the line of credit will have a term of 365 days, be
unsecured  and bear  interest at the rate of 2% per annum in excess of the prime
rate announced from time to time by Chase Manhattan Bank, N.A. The maturity date
of such  borrowing  will be  accelerated in the event of: (i) the removal of the
Managing  General  Partner  (whether  or  not  For  Cause);  (ii)  the  sale  or
refinancing of a property by the  Partnership;  or (iii) the  liquidation of the
Partnership. At the present time, the Partnership has no outstanding amounts due
under this line of credit.

AIMCO and its affiliates  currently own 38,400 limited  partnership units in the
Partnership  representing  63.453% of the  outstanding  units. A number of these
units were acquired  pursuant to tender offers made by AIMCO or its  affiliates.
It is possible  that AIMCO or its  affiliates  will make one or more  additional
offers to acquire  additional limited  partnership  interests in the Partnership
for cash or in exchange for units in the operating  partnership of AIMCO.  Under
the  Partnership  Agreement,  unitholders  holding a  majority  of the Units are
entitled to take action with respect to a variety of matters. As a result of its
ownership  of  63.453%  of the  outstanding  units,  AIMCO is in a  position  to
influence all voting  decisions with respect to the  Registrant.  When voting on
matters,  AIMCO would in all  likelihood  vote the Units it acquired in a manner
favorable  to the  interest of the  Managing  General  Partner  because of their
affiliation  with the Managing General Partner.  However,  DeForest  Ventures II
L.P., from whom AIMCO, through its merger with Insignia,  acquired significantly
all of its Units, had agreed for the benefit of non-tendering unit holders, that
it would vote its Units: (i) against any increase in compensation payable to the
Managing  General  Partner  or to  affiliates;  and  (ii) on all  other  matters
submitted  by it  or  its  affiliates,  in  proportion  to  the  votes  cast  by
non-tendering units holders.  Except for the foregoing, no other limitations are
imposed on Insignia Properties, L.P.'s right to vote each Unit acquired.

Note D - Distributions

During the three months ended March 31, 2000, the Partnership  declared and paid
a distribution  of  approximately  $1,220,000  (approximately  $1,208,000 to the
limited  partners  or  $19.96  per  limited   partnership  unit)  consisting  of
approximately $335,000  (approximately $332,000 to the limited partners or $5.49
per limited partnership unit) of cash from operations and approximately $885,000
(approximately   $876,000  to  the  limited   partners  or  $14.47  per  limited
partnership  unit) of cash from the refinance  proceeds of The Pines  Apartments
and from  refinancing  proceeds in prior years. A distribution of  approximately
$300,000  (approximately  $297,000 to the limited  partners or $4.91 per limited
partnership  unit) from refinancing  proceeds in prior years was paid during the
three months ended March 31, 1999.

<PAGE>

Note E - Refinancing of Mortgage Note Payable

On December 13, 1999, the  Partnership  refinanced the mortgage  encumbering The
Pines  Apartments.   The  refinancing  replaced  indebtedness  of  approximately
$3,406,000 with a new mortgage in the amount of $4,225,000. The interest rate on
the new  mortgage is 7.97% as compared to 8.56% on the  previous  debt.  The new
loan requires  monthly  principal and interest  payments and is being  amortized
over 20 years.  Total capitalized loan costs were  approximately  $88,000 during
the year ended December 31, 1999. Additional loan costs of approximately $16,000
were capitalized during the three months ended March 31, 2000.

Note F - Segment Reporting

The  Partnership  has  one  reportable  segment:   residential  properties.  The
Partnership's  residential property segment consists of five apartment complexes
located in the Southeast.  The Partnership  rents apartment units to tenants for
terms that are typically twelve months or less.

The  Partnership  evaluates  performance  based on segment  profit (loss) before
depreciation.  The accounting policies of the reportable segment are the same as
those of the Partnership as described in the Partnership's Annual Report on Form
10-KSB for the fiscal year ended December 31, 1999.

The Partnership's reportable segment is investment properties that offer similar
products and  services.  Although each of the  investment  properties is managed
separately,  they have been aggregated into one segment as they provide services
with similar types of products and customers.

Segment information for the three months ended March 31, 2000 and 1999, is shown
in the tables below (in  thousands).  The "Other"  column  includes  partnership
administration  related  items and  income  and  expense  not  allocated  to the
reportable segment.
<TABLE>
<CAPTION>

                     2000                        Residential        Other      Totals
<S>                                                <C>              <C>        <C>
Rental income                                      $ 1,751          $  --      $ 1,751
Other income                                            65              8          73
Interest expense                                       420             --         420
Depreciation                                           484             --         484
General and administrative expense                      --             91          91
Segment profit (loss)                                  102            (83)         19
Total assets                                        21,602            622      22,224
Capital expenditures for investment
  properties                                           303             --         303
</TABLE>

<PAGE>

<TABLE>
<CAPTION>

                     1999                        Residential      Other      Totals
<S>                                                <C>            <C>       <C>
Rental income                                      $ 1,813        $   --    $ 1,813
Other income                                            60             4         64
Interest expense                                       409            --        409
Depreciation                                           432            --        432
General and administrative expense                      --            71         71
Segment profit (loss)                                  206           (67)       139
Total assets                                        21,940           297     22,237
Capital expenditures for investment
  properties                                            91            --         91
</TABLE>

Note G - Legal Proceedings

In March 1998, several putative unit holders of limited partnership units of the
Partnership  commenced an action  entitled  Rosalie  Nuanes,  et al. v. Insignia
Financial  Group,  Inc., et al. in the Superior Court of the State of California
for the County of San Mateo. The plaintiffs  named as defendants,  among others,
the  Partnership,  the Managing  General Partner and several of their affiliated
partnerships  and corporate  entities.  The action  purports to assert claims on
behalf of a class of limited  partners and derivatively on behalf of a number of
limited  partnerships  (including  the  Partnership)  which are named as nominal
defendants,  challenging  the  acquisition  by Insignia  Financial  Group,  Inc.
("Insignia")  and  entities  which  were,  at one time,  affiliates  of Insignia
("Insignia  Affiliates") of interests in certain general partner entities,  past
tender offers by Insignia  Affiliates to acquire limited  partnership units, the
management of partnerships  by Insignia  Affiliates and the Insignia Merger (see
"Note B - Transfer  of  Control").  The  plaintiffs  seek  monetary  damages and
equitable relief, including judicial dissolution of the Partnership. On June 25,
1998,  the Managing  General  Partner  filed a motion  seeking  dismissal of the
action.  In lieu of  responding  to the  motion,  the  plaintiffs  have filed an
amended  complaint.  The Managing General Partner filed demurrers to the amended
complaint which were heard February 1999.  Pending the ruling on such demurrers,
settlement negotiations commenced. On November 2, 1999, the parties executed and
filed a  Stipulation  of  Settlement,  settling  claims,  subject to final court
approval, on behalf of the Partnership and all limited partners who own units as
of November 3, 1999.  Preliminary  approval of the  settlement  was  obtained on
November 3, 1999 from the Superior Court of the State of  California,  County of
San Mateo, at which time the Court set a final approval hearing for December 10,
1999.  Prior to the  December  10,  1999  hearing  the  Court  received  various
objections to the settlement,  including a challenge to the Court's  preliminary
approval based upon the alleged lack of authority of class  plaintiffs'  counsel
to enter the settlement.  On December 14, 1999, the Managing General Partner and
its affiliates terminated the proposed settlement. Certain plaintiffs have filed
a motion to  disqualify  some of the  plaintiffs'  counsel  in the  action.  The
Managing  General  Partner does not anticipate  that costs  associated with this
case will be material to the Partnership's overall operations.

The  Partnership is unaware of any other pending or outstanding  litigation that
is not of a routine nature arising in the ordinary course of business.

<PAGE>

ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

The  matters  discussed  in this Form  10-QSB  contain  certain  forward-looking
statements  and  involve  risks and  uncertainties  (including  changing  market
conditions,   competitive  and  regulatory   matters,   etc.)  detailed  in  the
disclosures  contained  in this  Form  10-QSB  and the  other  filings  with the
Securities and Exchange Commission made by the Registrant from time to time. The
discussion of the  Registrant's  business and results of  operations,  including
forward-looking  statements  pertaining  to such  matters,  does not  take  into
account the effects of any changes to the  Registrant's  business and results of
operation.  Accordingly,  actual  results  could  differ  materially  from those
projected in the forward-looking  statements as a result of a number of factors,
including those identified herein.

The Partnership's investment properties consist of five apartment complexes. The
following  table sets forth the average  occupancy of the properties for each of
the three month periods ended March 31, 2000 and 1999:

                                                  Average Occupancy
                                                   2000       1999

      Fairway View II Apartments                    93%        96%
         Baton Rouge, Louisiana
      The Pines Aparments                           97%        95%
         Roanoke, Virginia
      Patchen Place Apartments                      93%        95%
         Lexington, Kentucky
      Northwoods I and II Apartments                90%        95%
         Pensacola, Florida
      South Point Apartments                        89%        96%
         Durham, North Carolina

The Managing  General  Partner  attributes  the decrease in occupancy at Fairway
View II  Apartments  to tenants  temporarily  moving in during 1999 because of a
fire at a neighboring complex owned by an affiliated Partnership, which inflated
occupancy for the period.  The Managing General Partner  attributes the decrease
in occupancy at  Northwoods  Apartments  to a current  road  expansion  project.
Traffic  issues and road barriers have impacted new prospect  traffic as well as
additional  move  outs  due  to  this  project.  The  Managing  General  Partner
attributes  the  decrease in occupancy  at South Point  Apartments  to increased
competition in the Durham, North Carolina area.

Results of Operations

The  Registrant's  net  income for the three  months  ended  March 31,  2000 was
approximately  $19,000 compared to  approximately  $139,000 for the three months
ended March 31, 1999.  The decrease in net income was due to a decrease in total
revenues and an increase in total  expenses.  Total revenues  decreased due to a
decrease in rental  income  which was  partially  offset by an increase in other
income.  Rental income decreased primarily due to decreased occupancy at Fairway
View II, Northwoods I and II, Patchen Place, and South Point Apartments, as well
as  decreased  average  rental  rates  at  Fairway  View  II and  Patchen  Place
Apartments. In addition, concessions increased at Fairway View II and Northwoods
I and II  Apartments  and bad  debt  expense  increased  at  Patchen  Place  and
Northwoods I and II  Apartments.  The increase in other income was primarily due
to an increase in interest income as a result of higher interest bearing average
cash balances held by the Partnership during 2000.

<PAGE>

Total expenses  increased due to increases in  depreciation  expense and general
and  administrative  expenses  which  were  partially  offset by a  decrease  in
operating expenses.  Depreciation expense increased due to property improvements
and  replacements  completed  during the last twelve  months which are now being
depreciated. General and administrative expenses increased primarily due to fees
paid to the Managing General Partner in connection with the  distributions  from
operations  made during the three  months  ended March 31,  2000.  For the three
months ended March 31, 1999, no similar fees were paid because the  distribution
paid during this period was  entirely  from  refinancing  proceeds.  Included in
general  and  administrative  expenses  at both  March 31,  2000 and  1999,  are
management  reimbursements  to the Managing  General  Partner  allowed under the
Partnership   Agreement.   Costs   associated  with  the  quarterly  and  annual
communications  with  investors  and  regulatory  agencies  and the annual audit
required by the  Partnership  Agreement are also  included.  Operating  expenses
decreased primarily due to decreased utility expenses primarily at The Pines and
Northwoods I and II  Apartments  and to decreased  salary  expense at all of the
Partnership's properties.

As part of the ongoing  business plan of the  Partnership,  the Managing General
Partner  monitors  the  rental  market  environment  of each  of its  investment
properties  to assess  the  feasibility  of  increasing  rents,  maintaining  or
increasing  occupancy  levels and protecting the  Partnership  from increases in
expense.  As part of this plan, the Managing General Partner attempts to protect
the  Registrant  from the burden of  inflation-related  increases in expenses by
increasing rents and maintaining a high overall occupancy level. However, due to
changing market  conditions,  which can result in the use of rental  concessions
and  rental  reductions  to  offset  softening  market  conditions,  there is no
guarantee that the Managing General Partner will be able to sustain such a plan.

Liquidity and Capital Resources

At  March  31,  2000,  the  Partnership   had  cash  and  cash   equivalents  of
approximately  $1,876,000 as compared to  approximately  $1,224,000 at March 31,
1999. Cash and cash  equivalents  decreased by  approximately  $917,000 from the
Partnership's  year ended December 31, 1999 due to  approximately  $1,251,000 of
cash used in financing  activities  and  approximately  $314,000 of cash used in
investing  activities,  which more than  offset  approximately  $648,000 of cash
provided by operating activities. Cash used in financing activities consisted of
partner  distributions  and, to a lesser  extent,  the payment of loan costs and
payments of principal  made on the mortgage  encumbering  The Pines  Apartments.
Cash  used in  investing  activities  consisted  of  property  improvements  and
replacements and, to a lesser extent, net deposits to escrow accounts maintained
by the mortgage lender.

The Managing  General Partner has extended to the Partnership a $500,000 line of
credit.  The  Partnership  has no  outstanding  amounts  due under  this line of
credit. Based on present plans, the Managing General Partner does not anticipate
the need to borrow  against  the line of credit in the near  future.  Other than
cash and cash equivalents,  the line of credit is the Partnership's  only unused
source of liquidity.

The sufficiency of existing  liquid assets to meet future  liquidity and capital
expenditure   requirements   is  directly   related  to  the  level  of  capital
expenditures  required at the various  properties  to  adequately  maintain  the
physical  assets and other  operating needs of the Registrant and to comply with
Federal, state and local legal and regulatory requirements. Capital improvements
for each of the Registrant's properties are detailed below.

<PAGE>

Fairway View II

During  the  three  months  ended  March 31,  2000,  the  Partnership  completed
approximately  $27,000 of capital  improvements  at Fairway View II,  consisting
primarily of carpet and vinyl  replacements and structural  improvements.  These
improvements were funded from operating cash flow. The Partnership evaluated the
capital  improvement  needs of the  property  for the current  year.  The amount
budgeted is approximately $79,000, consisting primarily of air conditioning unit
replacement,   appliances,   carpet  and  vinyl  replacements,   and  structural
improvements.  Additional  improvements may be considered and will depend on the
physical  condition  of  the  property  as  well  as  replacement  reserves  and
anticipated cash flow generated by the property.

The Pines

During  the  three  months  ended  March 31,  2000,  the  Partnership  completed
approximately $21,000 of capital improvements at The Pines, consisting primarily
of carpet  replacement,  major  landscaping,  and swimming pool upgrades.  These
improvements were funded from operating cash flow. The Partnership evaluated the
capital  improvement  needs of the  property  for the current  year.  The amount
budgeted is approximately $65,000, consisting primarily of air conditioning unit
replacement, window treatments,  appliances, and carpet replacement.  Additional
improvements may be considered and will depend on the physical  condition of the
property as well as replacement  reserves and anticipated cash flow generated by
the property.

Patchen Place

During  the  three  months  ended  March 31,  2000,  the  Partnership  completed
approximately  $45,000 of capital  improvements  at  Patchen  Place,  consisting
primarily  of carpet and vinyl  replacement,  electrical  upgrades,  submetering
improvements,  and  major  landscaping.  These  improvements  were  funded  from
operating cash flow. The Partnership  evaluated the capital improvement needs of
the  property  for the  current  year.  The  amount  budgeted  is  approximately
$115,000, consisting primarily of air conditioning unit replacement, appliances,
carpet and vinyl replacement,  structural  improvements,  and plumbing upgrades.
Additional  improvements  may be  considered  and will  depend  on the  physical
condition of the property as well as replacement  reserves and anticipated  cash
flow generated by the property.

Northwoods I and II

During  the  three  months  ended  March 31,  2000,  the  Partnership  completed
approximately  $190,000 of capital improvements at Northwoods I & II, consisting
primarily   of  carpet   replacements,   exterior   painting,   and   structural
improvements.  These  improvements  were funded from  Partnership  reserves  and
operating cash flow. The Partnership  evaluated the capital improvement needs of
the  property  for the  current  year.  The  amount  budgeted  is  approximately
$328,000, consisting primarily of air conditioning unit replacement,  carpet and
vinyl  replacements,   electrical  upgrades,  major  landscaping,   parking  lot
improvements,  appliances,  sprinkler systems, and plumbing upgrades. Additional
improvements may be considered and will depend on the physical  condition of the
property as well as replacement  reserves and anticipated cash flow generated by
the property.

South Point

During  the  three  months  ended  March 31,  2000,  the  Partnership  completed
approximately  $20,000  of  capital  improvements  at  South  Point,  consisting
primarily of carpet and vinyl  replacement,  golf carts,  and appliances.  These
improvements were funded from operating cash flow. The Partnership evaluated the
capital  improvement  needs of the  property  for the current  year.  The amount
budgeted is approximately $59,000, consisting primarily of appliances and carpet
and vinyl replacement. Additional improvements may be considered and will depend
on the physical  condition of the property as well as  replacement  reserves and
anticipated cash flow generated by the property.

The additional  capital  improvements will be incurred only if cash is available
from operations or from Partnership  reserves.  To the extent that such budgeted
capital improvements are completed,  the Partnership's  distributable cash flow,
if any, may be adversely affected at least in the short term.

On December 13, 1999, the  Partnership  refinanced the mortgage  encumbering The
Pines  Apartments.   The  refinancing  replaced  indebtedness  of  approximately
$3,406,000 with a new mortgage in the amount of $4,225,000. The interest rate on
the new  mortgage is 7.97% as compared to 8.56% on the  previous  debt.  The new
loan requires  monthly  principal and interest  payments and is being  amortized
over 20 years.  Total capitalized loan costs were  approximately  $88,000 during
the year ended December 31, 1999. Additional loan costs of approximately $16,000
were capitalized during the three months ended March 31, 2000.

The  Registrant's  current assets are thought to be sufficient for any near-term
needs  (exclusive  of capital  improvements)  of the  Registrant.  The  mortgage
indebtedness of approximately $4,210,000 encumbering The Pines is amortized over
20 years.  The mortgage  indebtedness  of $16,800,000  encumbering the remaining
properties is interest only with required balloon payments due November 1, 2003.
The Managing General Partner will attempt to refinance such indebtedness  and/or
sell the properties  prior to such maturity dates.  If the properties  cannot be
refinanced or sold for a sufficient  amount, the Registrant may risk losing such
properties through foreclosure.

During the three months ended March 31, 2000, the Partnership  declared and paid
a distribution  of  approximately  $1,220,000  (approximately  $1,208,000 to the
limited  partners  or  $19.96  per  limited   partnership  unit)  consisting  of
approximately $335,000  (approximately $332,000 to the limited partners or $5.49
per limited partnership unit) of cash from operations and approximately $885,000
(approximately   $876,000  to  the  limited   partners  or  $14.47  per  limited
partnership  unit) of cash from the refinance  proceeds of The Pines  Apartments
and from  refinancing  proceeds in prior years. A distribution of  approximately
$300,000  (approximately  $297,000 to the limited  partners or $4.91 per limited
partnership  unit) from refinancing  proceeds in prior years was paid during the
three months ended March 31, 1999. Future cash  distributions will depend on the
levels of net cash generated from operations, the availability of cash reserves,
and the timing of debt  maturities,  refinancings,  and/or property  sales.  The
Registrant's  distribution  policy is reviewed on a semi-annual basis. There can
be no assurance,  however,  that the Partnership will generate  sufficient funds
from  operations  after required  capital  expenditures to permit any additional
distributions  to its  partners  during  the  remainder  of 2000  or  subsequent
periods.

<PAGE>

                           PART II - OTHER INFORMATION

ITEM 1.     LEGAL PROCEEDINGS

In March 1998, several putative unit holders of limited partnership units of the
Partnership  commenced an action  entitled  Rosalie  Nuanes,  et al. v. Insignia
Financial  Group,  Inc., et al. in the Superior Court of the State of California
for the County of San Mateo. The plaintiffs  named as defendants,  among others,
the  Partnership,  the Managing  General Partner and several of their affiliated
partnerships  and corporate  entities.  The action  purports to assert claims on
behalf of a class of limited  partners and derivatively on behalf of a number of
limited  partnerships  (including  the  Partnership)  which are named as nominal
defendants,  challenging  the  acquisition  by Insignia  Financial  Group,  Inc.
("Insignia")  and  entities  which  were,  at one time,  affiliates  of Insignia
("Insignia  Affiliates") of interests in certain general partner entities,  past
tender offers by Insignia  Affiliates to acquire limited  partnership units, the
management of partnerships  by Insignia  Affiliates and the Insignia Merger (see
"Part 1 - Financial Information, Item 1. Financial Statements, Note B - Transfer
of  Control").  The  plaintiffs  seek  monetary  damages and  equitable  relief,
including  judicial  dissolution  of the  Partnership.  On June  25,  1998,  the
Managing General Partner filed a motion seeking dismissal of the action. In lieu
of responding to the motion, the plaintiffs have filed an amended complaint. The
Managing  General  Partner filed  demurrers to the amended  complaint which were
heard  February  1999.   Pending  the  ruling  on  such  demurrers,   settlement
negotiations  commenced.  On November 2, 1999, the parties  executed and filed a
Stipulation of Settlement,  settling claims, subject to final court approval, on
behalf of the Partnership and all limited  partners who own units as of November
3, 1999. Preliminary approval of the settlement was obtained on November 3, 1999
from the  Superior  Court of the State of  California,  County of San Mateo,  at
which time the Court set a final approval  hearing for December 10, 1999.  Prior
to the December 10, 1999 hearing the Court  received  various  objections to the
settlement, including a challenge to the Court's preliminary approval based upon
the  alleged  lack of  authority  of class  plaintiffs'  counsel  to  enter  the
settlement.  On  December  14,  1999,  the  Managing  General  Partner  and  its
affiliates  terminated the proposed settlement.  Certain plaintiffs have filed a
motion to disqualify some of the plaintiffs' counsel in the action. The Managing
General Partner does not anticipate that costs associated with this case will be
material to the Partnership's overall operations.

ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K

            a)    Exhibits:

                  Exhibit 27, Financial Data Schedule, is filed as an exhibit to
                  this report.

            b)    Reports on Form 8-K filed during the first quarter of 2000:

                  None.

<PAGE>


                                   SIGNATURES

In accordance with the  requirements of the Exchange Act, the Registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                                    NATIONAL PROPERTY INVESTORS 7

                                    By:   NPI EQUITY INVESTMENTS, INC.
                                          Its Managing General Partner

                                    By:   /s/ Patrick J. Foye
                                          Patrick J. Foye
                                          Executive Vice President

                                    By:   /s/ Martha L. Long
                                          Martha L. Long
                                          Senior Vice President
                                          and Controller

                                    Date: