SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   Form 10-KSB
(Mark One)
[X]   ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
         1934


                    For the fiscal year ended December 31, 2002

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


                For the transition period from _________to _________

                         Commission file number 0-10412

                          NATIONAL PROPERTY INVESTORS 4
                 (Name of small business issuer in its charter)

         California                                             13-3031722
(State or other jurisdiction of                              (I.R.S. Employer
 incorporation or organization)                             Identification No.)

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

                    Issuer's telephone number (864) 239-1000

           Securities registered under Section 12(b) of the Exchange Act:

                                      None

           Securities registered under Section 12(g) of the Exchange Act:

                            Limited Partnership Units
                                (Title of class)

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___

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure  will be contained,  to
the best of the  Partnership's  knowledge  in  definitive  proxy or  information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this Form 10-KSB. [X]

State issuer's revenues for its most recent fiscal year.  $7,563,000

State the aggregate  market value of the voting  partnership  interests  held by
non-affiliates  computed  by  reference  to the price at which  the  partnership
interests  were sold,  or the average bid and asked  prices of such  partnership
interests as of December 31, 2002. No market exists for the limited  partnership
interests of the Registrant,  and,  therefore,  no aggregate market value can be
determined.

                       DOCUMENTS INCORPORATED BY REFERENCE
                                      None


<PAGE>



The matters discussed in this report contain certain forward-looking statements,
including, without limitation, statements regarding future financial performance
and the effect of government  regulations.  The discussions of the  Registrant's
business  and  results  of  operations,   including  forward-looking  statements
pertaining to such matters,  do not take into account the effects of any changes
to the  Registrant's  business  and results of  operations.  Actual  results may
differ  materially  from those described in the  forward-looking  statements and
will  be  affected  by  a  variety  of  risks  and  factors  including,  without
limitation:  national and local economic  conditions;  the terms of governmental
regulations that affect the Registrant and interpretations of those regulations;
the competitive  environment in which the Registrant operates;  financing risks,
including the risk that cash flows from  operations may be  insufficient to meet
required  payments of  principal  and  interest;  real estate  risks,  including
variations  of real  estate  values and the  general  economic  climate in local
markets and competition for tenants in such markets; and possible  environmental
liabilities.   Readers  should  carefully  review  the  Registrant's   financial
statements and the notes thereto,  as well as the risk factors  described in the
documents  the  Registrant  files  from  time to time  with the  Securities  and
Exchange Commission.

                                     PART I

Item 1.     Description of Business

National  Property   Investors  4  (the  "Partnership"  or  "Registrant")  is  a
California  limited  partnership formed in July 1980. The Partnership is engaged
in the business of operating and holding real estate  properties for investment.
NPI Equity  Investments,  Inc., a Florida  corporation,  became the Registrant's
managing  general  partner (the "Managing  General  Partner" or "NPI Equity") on
June 21,  1991.  The  Managing  General  Partner  was a  subsidiary  of National
Property Investors, Inc. ("NPI") until December 31, 1996, at which time Insignia
Properties Trust ("IPT")  acquired the stock of NPI Equity.  On October 1, 1998,
IPT  merged  into  Apartment   Investment  and  Management   Company  ("AIMCO").
Therefore,  the Managing General Partner is a wholly-owned  subsidiary of AIMCO.
The  partnership  agreement  provides  that the  Partnership  is to terminate on
December 31, 2005, unless terminated prior to such date.

The  principal  business  of the  Partnership  is to  hold  for  investment  and
ultimately  sell  income-producing   multi-family  residential  properties.  The
Partnership is a "closed"  limited  partnership  real estate syndicate formed to
acquire multi-family  residential properties.  In 1981, the Partnership offered,
pursuant  to  a  registration  statement  filed  with  the  Securities  Exchange
Commission, 70,000 Limited Partnership units (the "Units") and sold 60,005 units
aggregating  $30,002,500.  The net proceeds of the offering were used to acquire
seven  income-producing   residential  properties.  The  Partnership's  original
property portfolio was geographically diversified. The Partnership's acquisition
activities  were completed in May 1982 and since then the principal  activity of
the Partnership has been managing its portfolio. Six of the properties were sold
prior to 1997.  The  Partnership  currently owns one  residential  property (see
"Item 2.  Description of Property").  Since its initial offering the Partnership
has not  received,  nor are the Limited  Partners  required to make,  additional
capital contributions.

The Partnership  has no employees.  Management and  administrative  services are
provided by the Managing  General Partner and by agents retained by the Managing
General Partner.  Property  management  services are provided by an affiliate of
the Managing General Partner.


<PAGE>



Risk Factors

The  real  estate  business  in which  the  Partnership  is  engaged  is  highly
competitive.  There are other  residential  properties within the market area of
the Partnership's  property.  The number and quality of competitive  properties,
including  those which may be managed by an affiliate  of the  Managing  General
Partner,  in such market area could have a material  effect on the rental market
for the  apartments  at the  Partnership's  property  and the rents  that may be
charged  for  such  apartments.  While  the  Managing  General  Partner  and its
affiliates  own and/or  control a significant  number of apartment  units in the
United  States such units  represent an  insignificant  percentage  of the total
apartment  units in the United  States and  competition  for the  apartments  is
local.

Laws benefiting  disabled persons may result in the Partnership's  incurrence of
unanticipated  expenses.  Under the Americans with  Disabilities Act of 1990, or
ADA,  all places  intended to be used by the public are required to meet certain
Federal  requirements  related to access and use by disabled persons.  Likewise,
the Fair Housing Amendments Act of 1988, or FHAA, requires apartment  properties
first occupied after March 13, 1990 to be accessible to the  handicapped.  These
and other  Federal,  state  and  local  laws may  require  modifications  to the
Partnership's  property, or restrict renovations of the property.  Noncompliance
with these laws could result in the  imposition  of fines or an award of damages
to  private  litigants  and  also  could  result  in an  order  to  correct  any
non-complying  feature,  which could result in substantial capital expenditures.
Although the Managing General Partner believes that the  Partnership's  property
is  substantially in compliance with present  requirements,  the Partnership may
incur unanticipated expenses to comply with the ADA and the FHAA.

Both the income and expenses of operating the property owned by the  Partnership
are subject to factors outside of the Partnership's  control, such as changes in
the supply and demand for  similar  properties  resulting  from  various  market
conditions, increases/decreases in unemployment or population shifts, changes in
the  availability of permanent  mortgage  financing,  changes in zoning laws, or
changes in patterns or needs of users. In addition,  there are risks inherent in
owning  and  operating  residential   properties  because  such  properties  are
susceptible  to the  impact of  economic  and other  conditions  outside  of the
control of the Partnership.

There have been, and it is possible there may be other, Federal, state and local
legislation  and  regulations   enacted   relating  to  the  protection  of  the
environment.  The Partnership is unable to predict the extent,  if any, to which
such new  legislation  or  regulations  might occur and the degree to which such
existing or new legislation or regulations  might adversely  affect the property
owned by the Partnership.

The  Partnership  monitors its property for evidence of  pollutants,  toxins and
other dangerous substances, including the presence of asbestos. In certain cases
environmental  testing has been performed which resulted in no material  adverse
conditions or liabilities.  In no case has the Partnership  received notice that
it is a potentially  responsible party with respect to an environmental clean up
site.

Insurance  coverage is becoming  more  expensive  and  difficult to obtain.  The
current  insurance market is  characterized by rising premium rates,  increasing
deductibles,  and more restrictive  coverage language.  Recent developments have
resulted in  significant  increases in insurance  premiums and have made it more
difficult to obtain  certain types of insurance.  As an example,  many insurance
carriers are excluding  mold-related  risks from their policy coverages,  or are
adding  significant  restrictions to such coverage.  Continued  deterioration in
insurance   market  place   conditions  may  have  a  negative   effect  on  the
Partnership's operating results.


A further  description  of the  Partnership's  business  is included in "Item 6.
Management's Discussion and Analysis or Plan of Operation" included in this Form
10-KSB.

Item 2.     Description of Property

The following table sets forth the Partnership's investment in its property:

                                     Date of
Property                            Purchase     Type of Ownership           Use

Village of Pennbrook Apartments     12/15/81  Fee simple, subject to   Apartment
  Falls Township, Pennsylvania                first mortgage           722 units

Schedule of Property

Set forth  below for the  Partnership's  property is the gross  carrying  value,
accumulated depreciation,  depreciable life, method of depreciation, and Federal
tax basis.

<TABLE>
<CAPTION>

                          Gross
                         Carrying   Accumulated                           Federal
Property                  Value    Depreciation     Rate      Method     Tax Basis
                             (in thousands)                            (in thousands)
Village of Pennbrook
<S>                       <C>         <C>        <C>                      <C>
  Apartments              $28,810     $23,621    5-27.5 yrs    S/L        $ 4,519
</TABLE>

See  "Item  7.  Financial  Statements  -  Note  A"  for  a  description  of  the
Partnership's capitalization and depreciation policies.

Schedule of Property Indebtedness

The  following  table  sets  forth  certain  information  relating  to the  loan
encumbering the Partnership's property.

<TABLE>
<CAPTION>

                       Principal                                            Principal
                      Balance At             Stated                          Balance
                       December    Monthly  Interest   Period   Maturity      Due At
                          31,
Property                 2002      Payment    Rate    Amortized   Date       Maturity
                         (in thousands)                                   (in thousands)
Village of Pennbrook
<S>                     <C>         <C>       <C>        <C>    <C>   <C>      <C>
  Apartments            $29,425     $ 236     7.01%      20     09/01/21       $ --
</TABLE>

On August 31,  2001,  the  Partnership  refinanced  the  mortgage  note  payable
encumbering Village of Pennbrook  Apartments.  The refinancing replaced mortgage
indebtedness of $19,300,000 with a new mortgage of $30,400,000. The new mortgage
carries a stated  interest  rate of 7.01%  compared to a stated rate of 7.33% on
the old  mortgage.  Payments of principal and interest are due monthly until the
loan matures in September  2021 at which time the loan will be fully  amortized.
Loan  costs  capitalized  for  the  refinancing  were  approximately   $858,000,
including  a  $304,000  refinancing  fee paid to an  affiliate  of the  Managing
General Partner pursuant to the Partnership Agreement.  The Partnership recorded
a loss on early extinguishment of debt of approximately  $169,000 as a result of
unamortized loan costs being written off.

See "Item 7. Financial  Statements - Note C" for information with respect to the
Registrant's  ability to repay this loan and other  specific  details  about the
loan.

Rental Rates and Occupancy

Average annual rental rates and occupancy for 2002 and 2001 for the property:

                                    Average Annual
                                     Rental Rates                   Average
                                      (per unit)                   Occupancy
 Property                        2002            2001           2002        2001
 Village of Pennbrook
   Apartments                   $10,584         $10,186         95%          96%

As noted under "Item 1.  Description of Business",  the real estate  industry is
highly  competitive.  The Partnership's  property is subject to competition from
other residential  apartment complexes in the area. The Managing General Partner
believes that the property is adequately  insured.  The property is an apartment
complex  which leases units for terms of one year or less.  No tenant leases 10%
or more  of the  available  rental  space.  The  property  is in  good  physical
condition,  subject to normal  depreciation and  deterioration as is typical for
assets of this type and age.

Real Estate Taxes and Rates

Real estate taxes and rates in 2002 for the property:

                                              2002              2002
                                             Billing            Rate
                                         (in thousands)
       Village of Pennbrook
         Apartments                           $578             5.35%

Capital Improvements

During the year ended December 31, 2002, the Partnership completed approximately
$338,000 of capital improvements at Village of Pennbrook consisting primarily of
air conditioning replacements,  floor coverings, water heaters,  appliances, and
maintenance  equipment.  These capital  improvements  were funded primarily from
operating  cash flow.  The  Partnership  is  currently  evaluating  the  capital
improvement needs of the property for the upcoming year and currently expects to
budget approximately $217,000.  Additional improvements may be considered during
2003 and will  depend  on the  physical  condition  of the  property  as well as
anticipated cash flows generated by the property.

Item 3.     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. (the "Nuanes action") in the Superior Court of the
State of  California  for the  County  of San  Mateo.  The  plaintiffs  named as
defendants,  among others,  the  Partnership,  its 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,  among other
things,  the  acquisition  of  interests  in certain  Managing  General  Partner
entities by Insignia Financial Group, Inc. ("Insignia") and entities which were,
at one  time,  affiliates  of  Insignia;  past  tender  offers  by the  Insignia
affiliates to acquire limited partnership units;  management of the partnerships
by the  Insignia  affiliates;  and the series of  transactions  which  closed on
October 1, 1998 and February 26, 1999 whereby  Insignia and Insignia  Properties
Trust,  respectively,  were merged  into AIMCO.  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  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 court approval, on behalf of the Partnership and all
limited partners who owned units as of November 3, 1999. Preliminary approval of
the  settlement  was obtained on November 3, 1999 from the Court,  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 prior lead counsel to enter the settlement.  On
December 14, 1999, the Managing  General  Partner and its affiliates  terminated
the  proposed  settlement.  In  February  2000,  counsel  for some of the  named
plaintiffs filed a motion to disqualify plaintiff's lead and liaison counsel who
negotiated  the  settlement.  On June  27,  2000,  the  Court  entered  an order
disqualifying  them  from the case and an  appeal  was  taken  from the order on
October 5, 2000. On December 4, 2000, the Court  appointed the law firm of Lieff
Cabraser  Heimann & Bernstein  LLP as new lead  counsel for  plaintiffs  and the
putative class.  Plaintiffs filed a third amended complaint on January 19, 2001.
On March 2, 2001,  the  Managing  General  Partner  and its  affiliates  filed a
demurrer to the third amended  complaint.  On May 14, 2001,  the Court heard the
demurrer to the third amended  complaint.  On July 10, 2001, the Court issued an
order  sustaining  defendants'  demurrer on certain  grounds.  On July 20, 2001,
Plaintiffs filed a motion for reconsideration of the Court's July 10, 2001 order
granting in part and denying in part defendants' demurrer. On September 7, 2001,
Plaintiffs  filed a fourth amended class and  derivative  action  complaint.  On
September 12, 2001, the Court denied Plaintiffs' motion for reconsideration.  On
October 5, 2001, the Managing General Partner and affiliated  defendants filed a
demurrer to the fourth amended complaint,  which was heard on December 11, 2001.
On February 2, 2002,  the Court served its order  granting in part the demurrer.
The  Court has  dismissed  without  leave to amend  certain  of the  plaintiffs'
claims.  On February 11, 2002,  plaintiffs  filed a motion  seeking to certify a
putative  class  comprised of all  non-affiliated  persons who own or have owned
units  in  the  partnerships.   The  Managing  General  Partner  and  affiliated
defendants  oppose the motion.  On April 29,  2002,  the Court held a hearing on
plaintiffs' motion for class  certification and took the matter under submission
after further  briefing,  as ordered by the court, was submitted by the parties.
On July 10, 2002,  the Court entered an order vacating the current trial date of
January 13, 2003 (as well as the  pre-trial  and  discovery  cut-off  dates) and
stayed the case in its  entirety  through  November  7, 2002 so that the parties
could have an opportunity to discuss settlement.  On October 30, 2002, the court
entered an order extending the stay in effect through January 10, 2003.

On January 8, 2003,  the parties filed a  Stipulation  of Settlement in proposed
settlement of the Nuanes action and the Heller action described below. The Court
has  scheduled  the hearing on  preliminary  approval  for April 4, 2003 and the
hearing on final approval for June 2, 2003.

In general  terms,  the  proposed  settlement  provides  for  certification  for
settlement  purposes of a settlement class consisting of all limited partners in
this  Partnership and others (the  "Partnerships")  as of December 20, 2002, the
dismissal  with  prejudice  and  release  of claims  in the  Nuanes  and  Heller
litigation,  payment by AIMCO of $9.9  million  (which shall be  distributed  to
settlement  class  members  after  deduction of attorney fees and costs of class
counsel and certain costs of  settlement)  and up to $ 1 million toward the cost
of independent  appraisals of the Partnerships'  properties by a Court appointed
appraiser.  An affiliate of the Managing General Partner has also agreed to make
a tender offer to purchase all of the partnership  interests in the Partnerships
within one year of final  approval,  if it is granted,  and to provide  partners
with the  independent  appraisals  at the time of these  tenders.  The  proposed
settlement  also provides for the  limitation  of the allowable  costs which the
Managing  General  Partner or its  affiliates  will charge the  Partnerships  in
connection with this litigation and imposes limits on the class counsel fees and
costs in this  litigation.  If the  Court  grants  preliminary  approval  of the
proposed settlement in March, a notice will be distributed to partners providing
detail on the terms of the proposed settlement.

During the third  quarter of 2001, a complaint  (the "Heller  action") was filed
against  the same  defendants  that are named in the  Nuanes  action,  captioned
Heller v. Insignia Financial Group. On or about August 6, 2001, plaintiffs filed
a first amended  complaint.  The first amended complaint in the Heller action is
brought as a purported  derivative  action,  and asserts  claims for among other
things  breach  of  fiduciary  duty;  unfair  competition;   conversion,  unjust
enrichment;  and judicial  dissolution.  Plaintiffs in the Nuanes action filed a
motion to  consolidate  the Heller action with the Nuanes action and stated that
the Heller action was filed in order to preserve the derivative claims that were
dismissed  without  leave to amend in the Nuanes action by the Court order dated
July 10, 2001. On October 5, 2001, the Managing  General  Partner and affiliated
defendants  moved to strike the first  amended  complaint  in its  entirety  for
violating  the Court's July 10, 2001 order  granting in part and denying in part
defendants'  demurrer in the Nuanes action, or alternatively,  to strike certain
portions of the complaint based on the statute of limitations.  Other defendants
in the action  demurred to the fourth  amended  complaint,  and,  alternatively,
moved to strike the complaint. On December 11, 2001, the court heard argument on
the motions  and took the matters  under  submission.  On February 4, 2002,  the
Court  served  notice of its order  granting  defendants'  motion to strike  the
Heller complaint as a violation of its July 10, 2001 order in the Nuanes action.
On March 27, 2002,  the plaintiffs  filed a notice  appealing the order striking
the  complaint.  Before  completing  briefing on the appeal,  the parties stayed
further proceedings in the appeal pending the Court's review of the terms of the
proposed settlement described above.

Estate of Harry  Schubert v.  National  Property  Investors  4, Civil Action No.
97-09129, Court of Common Pleas of Bucks County, Pennsylvania.  During 1998, the
Plaintiff brought action against the Partnership  alleging that as the result of
carbon monoxide and methane  poisoning due to a malfunctioning  heat unit in the
apartment at the Partnership's property, which was leased by decedent's son, the
decedent lost consciousness for several hours,  suffered respiratory arrest, and
suffered  other pains and injuries.  The Plaintiff  alleges  breach of contract,
fraud,  violations of the Unfair Trade Practices and Consumer Protection Law and
negligence resulting in wrongful death. This matter is in the discovery phase of
litigation. The Partnership is vigorously defending this matter.

The  Managing  General  Partner  does  not  anticipate  that  any  costs  to the
Partnership, whether legal or settlement costs, associated with these cases 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.

Item 4.     Submission of Matters to a Vote of Security Holders

During the quarter ended  December 31, 2002, no matters were submitted to a vote
of the Unit holders through the solicitation of proxies or otherwise.


<PAGE>


                                     PART II

Item 5.    Market for the Registrant's Common Equity and Related Security Holder
           Matters

The Partnership,  a publicly-held  limited partnership,  offered and sold 60,005
limited partnership units aggregating $30,002,500.  As of December 31, 2002, the
Partnership  had 60,005  units  outstanding  held by 1,134  limited  partners of
record.  Affiliates of the Managing General Partner owned 45,293 units or 75.48%
at December 31, 2002. No public trading market has developed for the Units,  and
it is not anticipated that such a market will develop in the future.

The  Partnership  distributed  the  following  amounts  during  the years  ended
December 31, 2002 and 2001 (in thousands, except per unit data):

<TABLE>
<CAPTION>

                          Year          Per Limited          Year         Per Limited
                          Ended         Partnership         Ended         Partnership
                    December 31, 2002      Unit       December 31, 2001       Unit

<S>                      <C>              <C>              <C>              <C>
Operations               $ 1,616          $ 26.66          $ 2,666          $ 43.98
Refinancing (1)               --               --           10,226           170.42
                         $ 1,616          $ 26.66          $12,892          $214.40
</TABLE>

(1) From the refinancing of Village of Pennbrook Apartments in August 2001.

Future  cash  distributions  will  depend on the levels of cash  generated  from
operations,  the  availability  of cash  reserves  and the  timing  of the  debt
maturity,   refinancing,   and/or  sale  of  the  property.   The  Partnership's
distribution  policy is reviewed on a monthly  basis.  There can be no assurance
that the  Partnership  will  generate  sufficient  funds from  operations  after
required capital expenditures to permit distributions to its partners in 2003 or
subsequent periods.

In addition to its  indirect  ownership of the general  partner  interest in the
Partnership,  AIMCO and its affiliates  owned 45,293 limited  partnership  units
(the "Units") in the Partnership representing 75.48% of the outstanding Units at
December  31,  2002.  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 acquire additional units of limited partnership  interest in the
Partnership  in  exchange  for cash or a  combination  of cash and  units in the
operating  partnership  of AIMCO  either  through  private  purchases  or tender
offers. Under the Partnership  Agreement,  unitholders holding a majority of the
Units are  entitled to take action  with  respect to a variety of matters  which
would  include  voting on certain  amendments to the  Partnership  Agreement and
voting to remove the Managing General  Partner.  As a result of its ownership of
75.48% of the  outstanding  Units,  AIMCO is in a position to influence all such
voting decisions with respect to the Partnership.  With respect to 26,466 units,
Insignia Properties,  LP, an affiliate of AIMCO, is required to vote such 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 unitholders. Except
for the  foregoing,  no other  limitations  are  imposed on AIMCO's or  Insignia
Properties,  L.P.'s  ability to influence  voting  decisions with respect to the
Partnership.  Although the Managing General Partner owes fiduciary duties to the
limited  partners of the  Partnership,  the Managing  General  Partner also owes
fiduciary duties to AIMCO as its sole  stockholder.  As a result,  the duties of
the Managing  General Partner,  as managing general partner,  to the Partnership
and its limited  partners may come into conflict with the duties of the Managing
General Partner to AIMCO, as its sole stockholder.


Item 6.     Management's Discussion and Analysis or Plan of Operation

This item should be read in conjunction with the financial  statements and other
items contained elsewhere in this report.

Results of Operations

Effective  April 1, 2002, the  Partnership  adopted SFAS No. 145,  "Recission of
FASB  Statements No. 4, 44 and 64." SFAS No. 4 "Reporting  Gains and Losses from
Extinguishment of Debt," required that all gains and losses from  extinguishment
of debt be aggregated  and, if material,  classified as an  extraordinary  item.
SFAS No.  145  rescinds  SFAS No.  4, and  accordingly,  gains and  losses  from
extinguishment  of debt should only be classified as  extraordinary  if they are
unusual  in nature  and occur  infrequently,  neither  of which  applies  to the
Partnership.  As a result,  the accompanying  statements of operations have been
restated  as of January 1, 2001 to reflect the loss on early  extinguishment  of
debt of approximately  $169,000 at Village of Pennbrook Apartments in operations
rather than as an extraordinary item.

The Partnership realized net income of approximately $1,176,000 and $986,000 for
the years ended  December 31, 2002 and 2001,  respectively.  The increase in net
income for the year ended  December 31, 2002 is  attributable  to an increase in
total revenues and a decrease in total expenses. Total revenues increased due to
an increase in rental income as a result of an increase in average  rental rates
at the Partnership's investment property.

The decrease in total  expenses is due to decreases  in  operating,  general and
administrative  expenses and the loss on  extinguishment  of debt  recognized in
2001 partially  offset by increases in interest and depreciation  expenses.  The
decrease  in  operating  expense is due to a decrease  in natural  gas costs and
maintenance  expenses,  primarily interior painting and yard and grounds upkeep,
at the Partnership's  investment property.  Also contributing to the decrease in
maintenance  expenses is an increase in the capitalization of certain direct and
indirect  project costs,  primarily  payroll related costs, at the property (see
"Item 7. Financial Statements,  Note A - Organization and Significant Accounting
Policies.")  General and administrative  expenses decreased due to a decrease in
partnership management fees and non-accountable  reimbursements  associated with
distributions from operations. Interest expense increased due to the refinancing
of the mortgage encumbering Village of Pennbrook Apartments in August 2001 which
resulted in a higher  average debt balance in 2002 (see  "Capital  Resources and
Liquidity"  for a further  discussion).  Depreciation  expense  increased due to
property  improvements  and  replacements  placed into  service  during the past
twelve months which are now being depreciated.  The loss on early extinguishment
of debt was due to the refinancing of the mortgage encumbering the Partnership's
investment property in August 2001.

Included in general and  administrative  expenses at both  December 31, 2002 and
2001 are management reimbursements to the Managing General Partner allowed under
the Partnership Agreement. In addition,  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.

As part of the ongoing  business plan of the  Partnership,  the Managing General
Partner  monitors the rental market  environment of its  investment  property to
assess the feasibility of increasing rents,  maintaining or increasing occupancy
levels and protecting  the  Partnership  from increases in expenses.  As part of
this plan, the Managing General Partner attempts to protect the Partnership 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.

Capital Resources and Liquidity

At  December  31,  2002,  the  Partnership  had  cash and  cash  equivalents  of
approximately  $282,000 compared to approximately $375,000 at December 31, 2001,
a decrease  of  approximately  $93,000.  The  decrease  is due to  approximately
$2,415,000  and $338,000 of cash used in  financing  and  investing  activities,
respectively,  partially offset by approximately  $2,660,000 of cash provided by
operating   activities.   Cash  used  in  financing   activities   consisted  of
distributions  paid to partners  and  principal  payments  made on the  mortgage
encumbering  the  Partnership's  property.  Cash  used in  investing  activities
consisted of property improvements and replacements. The Partnership invests its
working capital reserves in interest bearing accounts.

The Managing  General Partner has extended to the Partnership a $300,000 line of
credit.  At the present time, 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 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 property to adequately maintain the physical assets
and other operating needs of the Partnership and to comply with Federal,  state,
and local  legal and  regulatory  requirements.  The  Managing  General  Partner
monitors  developments  in the area of legal and  regulatory  compliance  and is
studying  new  federal  laws,  including  the  Sarbanes-Oxley  Act of 2002.  The
Sarbanes-Oxley Act of 2002 mandates or suggests  additional  compliance measures
with regard to governance,  disclosure, audit and other areas. In light of these
changes,  the Partnership  expects that it will incur higher expenses related to
compliance,  including  increased  legal  and audit  fees.  The  Partnership  is
currently  evaluating  the capital  improvement  needs of the  property  for the
upcoming  year  and  expects  to  budget   approximately   $217,000  in  capital
expenditures in 2003. Additional  improvements may be considered and will depend
on the  physical  condition of the  property as well as  anticipated  cash flows
generated by the property.

The  Partnership's  assets are thought to be sufficient for any near-term  needs
(exclusive  of  capital   improvements)   of  the   Partnership.   The  mortgage
indebtedness of  approximately  $29,425,000 is being amortized over 20 years and
will mature in  September  2021 at which time the  mortgage is  scheduled  to be
fully amortized.

On August 31,  2001,  the  Partnership  refinanced  the  mortgage  note  payable
encumbering Village of Pennbrook  Apartments.  The refinancing replaced mortgage
indebtedness of $19,300,000 with a new mortgage of $30,400,000. The new mortgage
carries a stated  interest  rate of 7.01%  compared to a stated rate of 7.33% on
the old  mortgage.  Payments of principal and interest are due monthly until the
loan matures.  Loan costs  capitalized  for the refinancing  were  approximately
$858,000,  including  a $304,000  refinancing  fee paid to an  affiliate  of the
Managing General Partner pursuant to the Partnership Agreement. During 2001, the
Partnership  recorded a loss on early  extinguishment  of debt of  approximately
$169,000 as a result of unamortized loan costs being written off.

Pursuant to the Partnership Agreement,  the term of the Partnership is scheduled
to expire on December 31, 2005. Accordingly,  prior to such date the Partnership
will need to  either  sell its  investment  property  or extend  the term of the
Partnership.


<PAGE>


The  Partnership  distributed  the  following  amounts  during  the years  ended
December 31, 2002 and 2001 (in thousands, except per unit data):

<TABLE>
<CAPTION>

                          Year          Per Limited          Year         Per Limited
                          Ended         Partnership         Ended         Partnership
                    December 31, 2002      Unit       December 31, 2001       Unit

<S>                      <C>              <C>              <C>              <C>
Operations               $ 1,616          $ 26.66          $ 2,666          $ 43.98
Refinancing (1)               --               --           10,226           170.42
                         $ 1,616          $ 26.66          $12,892          $214.40
</TABLE>

(1) From the refinancing of Village of Pennbrook Apartments in August 2001.

The  Partnership's  cash  available  for  distribution  is reviewed on a monthly
basis. Future cash distributions will depend on the levels of net cash generated
from operations,  the availability of cash reserves,  and the timing of the debt
maturity,  refinancing,  and/or sale of the property.  There can be no assurance
that the  Partnership  will  generate  sufficient  funds from  operations  after
required  capital  improvements to permit  distributions  to its partners during
2003 or subsequent periods.

Other

In addition to its  indirect  ownership of the general  partner  interest in the
Partnership,  AIMCO and its affiliates  owned 45,293 limited  partnership  units
(the "Units") in the Partnership representing 75.48% of the outstanding Units at
December  31,  2002.  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 acquire additional units of limited partnership  interest in the
Partnership  in  exchange  for cash or a  combination  of cash and  units in the
operating  partnership  of AIMCO  either  through  private  purchases  or tender
offers. Under the Partnership  Agreement,  unitholders holding a majority of the
Units are  entitled to take action  with  respect to a variety of matters  which
would  include  voting on certain  amendments to the  Partnership  Agreement and
voting to remove the Managing General  Partner.  As a result of its ownership of
75.48% of the  outstanding  Units,  AIMCO is in a position to influence all such
voting decisions with respect to the Partnership.  With respect to 26,466 units,
Insignia Properties,  LP, an affiliate of AIMCO, is required to vote such 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 unitholders. Except
for the  foregoing,  no other  limitations  are  imposed on AIMCO's or  Insignia
Properties,  L.P.'s  ability to influence  voting  decisions with respect to the
Partnership.  Although the Managing General Partner owes fiduciary duties to the
limited  partners of the  Partnership,  the Managing  General  Partner also owes
fiduciary duties to AIMCO as its sole  stockholder.  As a result,  the duties of
the Managing  General Partner,  as managing general partner,  to the Partnership
and its limited  partners may come into conflict with the duties of the Managing
General Partner to AIMCO, as its sole stockholder.

Critical Accounting Policies and Estimates

A summary of the Partnership's  significant  accounting  policies is included in
"Note A - Organization and Significant Accounting Policies" which is included in
the financial statements in "Item 7. Financial Statements". The Managing General
Partner  believes that the consistent  application of these policies enables the
Partnership  to provide  readers of the  financial  statements  with  useful and
reliable  information  about the  Partnership's  operating results and financial
condition. The preparation of financial statements in conformity with accounting
principles  generally  accepted in the United States requires the Partnership to
make  estimates and  assumptions.  These  estimates and  assumptions  affect the
reported  amounts  of  assets  and  liabilities  at the  date  of the  financial
statements  as well as reported  amounts of  revenues  and  expenses  during the
reporting  period.  Actual results could differ from these estimates.  Judgments
and  assessments  of  uncertainties  are required in applying the  Partnership's
accounting  policies in many areas. The following may involve a higher degree of
judgment and complexity.

Impairment of Long-Lived Assets

The  Partnership's  investment  property is recorded at cost,  less  accumulated
depreciation,  unless considered impaired.  If events or circumstances  indicate
that the carrying amount of the property may be impaired,  the Partnership  will
make an assessment of its  recoverability by estimating the undiscounted  future
cash flows,  excluding interest charges, of the property. If the carrying amount
exceeds the aggregate  future cash flows,  the  Partnership  would  recognize an
impairment  loss to the extent the carrying amount exceeds the fair value of the
property.

Real  property  investments  are  subject  to varying  degrees of risk.  Several
factors  may  adversely  affect  the  economic  performance  and  value  of  the
Partnership's   investment  property.  These  factors  include  changes  in  the
national,  regional and local economic  climate;  local  conditions,  such as an
oversupply  of  multifamily   properties;   competition   from  other  available
multifamily  property  owners and changes in market  rental  rates.  Any adverse
changes in these factors could cause an impairment in the Partnership's asset.

Revenue Recognition

The Partnership generally leases apartment units for twelve-month terms or less.
Rental income  attributable to leases is recognized  monthly as it is earned and
the Partnership  fully reserves all balances  outstanding  over thirty days. The
Partnership will offer rental concessions during  particularly slow months or in
response  to  heavy  competition  from  other  similar  complexes  in the  area.
Concessions are charged to income as incurred.


<PAGE>


Item 7.     Financial Statements

NATIONAL PROPERTY INVESTORS 4

LIST OF FINANCIAL STATEMENTS

      Report of Ernst & Young LLP, Independent Auditors

      Balance Sheet - December 31, 2002

      Statements of Operations - Years ended December 31, 2002 and 2001

      Statements of Changes in Partners' Deficit-Years ended  December 31, 2002
      and 2001

      Statements of Cash Flows - Years ended December 31, 2002 and 2001

      Notes to Financial Statements


<PAGE>


                 Report of Ernst & Young LLP, Independent Auditors



The Partners
National Property Investors 4


We have audited the accompanying  balance sheet of National Property Investors 4
as of December 31, 2002, and the related  statements of  operations,  changes in
partners' deficit,  and cash flows for each of the two years in the period ended
December 31, 2002.  These  financial  statements are the  responsibility  of the
Partnership's  management.  Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable  assurance about whether the financial  statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made  by the  Partnership's  management,  as  well  as  evaluating  the  overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the financial position of National Property Investors 4
at December 31, 2002,  and the results of its  operations and its cash flows for
each of the two years in the period ended December 31, 2002, in conformity  with
accounting principles generally accepted in the United States.

As  discussed in Note A to the  financial  statements,  in 2002 the  Partnership
adopted Statement of Financial Accounting Standards No. 145, "Rescission of FASB
Statements  No.  4,  44,  and  64."  As a  result,  the  accompanying  financial
statements  for 2001,  referred to above,  have been  restated to conform to the
presentation adopted in 2002 in accordance with accounting  principles generally
accepted in the United States.


                                                            /s/ERNST & YOUNG LLP



Greenville, South Carolina
February 14, 2003



<PAGE>





                          NATIONAL PROPERTY INVESTORS 4

                                  BALANCE SHEET
                        (in thousands, except unit data)

                                December 31, 2002

<TABLE>
<CAPTION>


Assets:
<S>                                                                          <C>
   Cash and cash equivalents                                                 $   282
   Receivables and deposits                                                       75
   Other assets                                                                1,094
   Investment property (Notes C and D):
      Land                                                    $ 1,980
      Buildings and related personal property                   26,830
                                                               28,810
      Less accumulated depreciation                            (23,621)        5,189

                                                                            $ 6,640
Liabilities and Partners' Deficit

Liabilities:
   Tenant security deposit liabilities                                      $    367
   Other liabilities                                                             534
   Mortgage note payable (Note C)                                             29,425

Partners' Deficit:
   General partner                                             $ (381)
   Limited partners (60,005 units issued and
      outstanding)                                             (23,305)      (23,686)

                                                                            $ 6,640

                   See Accompanying Notes to Financial Statements
</TABLE>


<PAGE>


                          NATIONAL PROPERTY INVESTORS 4

                            STATEMENTS OF OPERATIONS
                      (in thousands, except per unit data)


<TABLE>
<CAPTION>

                                                           Years Ended December 31,
                                                              2002         2001
                                                                        (Restated)
Revenues:
<S>                                                          <C>          <C>
  Rental income                                              $ 7,192      $ 7,167
  Other income                                                   371          378
      Total revenues                                           7,563        7,545

Expenses:
  Operating                                                    2,109        2,366
  General and administrative                                     312          499
  Depreciation                                                 1,266        1,216
  Interest                                                     2,135        1,718
  Property taxes                                                 565          591
  Loss on early extinguishment of debt                            --          169
      Total expenses                                         6,387          6,559
                                                               --

Net income                                                   $ 1,176       $ 986

Net income allocated to general partner (1%)                  $ 12         $ 10
Net income allocated to limited partners (99%)                 1,164          976

                                                             $ 1,176       $ 986

Net income per limited partnership unit                      $ 19.40      $ 16.27

Distributions per limited partnership unit                   $ 26.66      $214.40


                   See Accompanying Notes to Financial Statements
</TABLE>

<PAGE>


                          NATIONAL PROPERTY INVESTORS 4

                   STATEMENTS OF CHANGES IN PARTNERS' DEFICIT
                        (in thousands, except unit data)

<TABLE>
<CAPTION>


                                      Limited
                                     Partnership    General     Limited
                                        Units       Partner     Partners      Total

<S>                                    <C>            <C>       <C>         <C>
Original capital contributions         60,005         $ 1       $ 30,003    $ 30,004

Partners' deficit at
  December 31, 2000                    60,005       $ (360)     $(10,980)   $(11,340)

Distributions to partners                  --           (27)     (12,865)    (12,892)

Net income for the year ended
  December 31, 2001                        --            10          976         986

Partners' deficit at
  December 31, 2001                    60,005          (377)     (22,869)    (23,246)

Distributions to partners                  --           (16)      (1,600)     (1,616)

Net income for the year ended
  December 31, 2002                        --            12        1,164       1,176

Partners' deficit at
  December 31, 2002                    60,005       $ (381)     $(23,305)   $(23,686)


                   See Accompanying Notes to Financial Statements
</TABLE>

<PAGE>


                          NATIONAL PROPERTY INVESTORS 4

                            STATEMENTS OF CASH FLOWS
                                 (in thousands)

<TABLE>
<CAPTION>

                                                               Years Ended December 31,
                                                                   2002         2001
Cash flows from operating activities:
<S>                                                              <C>           <C>
  Net income                                                     $ 1,176       $ 986
  Adjustments to reconcile net income to net cash provided
   by operating activities:
     Depreciation                                                   1,266        1,216
     Amortization of loan costs                                        43           61
     Bad debt                                                          44            4
     Loss on early extinguishment of debt                              --          169
     Change in accounts:
      Receivables and deposits                                        319          356
      Other assets                                                    (16)          49
      Accounts payable                                                (37)         (10)
      Tenant security deposit liabilities                             (13)         (41)
      Other liabilities                                              (122)          47
        Net cash provided by operating activities                   2,660        2,837

Cash flows from investing activities:
  Property improvements and replacements                             (338)        (775)
  Net withdrawals from restricted escrows                              --           63
        Net cash used in investing activities                        (338)        (712)

Cash flows from financing activities:
  Distributions to partners                                        (1,616)     (12,892)
  Proceeds from refinancing                                            --       30,400
  Loan costs paid                                                      --         (858)
  Repayment of mortgage note payable                                   --      (19,300)
  Payments on mortgage note payable                                  (799)        (176)
        Net cash used in financing activities                      (2,415)      (2,826)

Net decrease in cash and cash equivalents                             (93)        (701)
Cash and cash equivalents at beginning of period                      375        1,076
Cash and cash equivalents at end of period                        $ 282        $ 375

Supplemental disclosure of cash flow information:
  Cash paid for interest                                         $ 2,270      $ 1,599

                   See Accompanying Notes to Financial Statements
</TABLE>

<PAGE>


                          NATIONAL PROPERTY INVESTORS 4

                          NOTES TO FINANCIAL STATEMENTS

                                December 31, 2002


Note A - Organization and Significant Accounting Policies

Organization

National   Property   Investors  4,  a  California   Limited   Partnership  (the
"Partnership" or "Registrant"),  was formed on July 1, 1980 to acquire, hold for
investment,  and ultimately sell income producing real estate property.  Capital
contributions of $30,002,500  ($500 per unit) were made by the limited partners.
In addition,  the general partner  contributed  $1,000. The Partnership owns one
apartment complex located in Falls Township,  Pennsylvania. The managing general
partner is NPI Equity  Investments,  Inc. ("NPI Equity" or the "Managing General
Partner").  The  Managing  General  Partner  is  a  wholly-owned  subsidiary  of
Apartment  Investment and Management Company  ("AIMCO"),  a publicly traded real
estate investment trust. The Partnership Agreement provides that the Partnership
is to terminate on December 31, 2005, unless terminated prior to such date.

Use of Estimates

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States  requires  management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

Investment Property

Investment  property  consists of one  apartment  complex and is stated at cost.
Acquisition  fees are  capitalized  as a cost of real  estate.  Expenditures  in
excess of $250 that  maintain an existing  asset which has a useful life of more
than  one  year  are  capitalized  as  capital   replacement   expenditures  and
depreciated  over the  estimated  useful  life of the  asset.  Expenditures  for
ordinary  repairs,  maintenance  and  apartment  turnover  costs are expensed as
incurred.  In  accordance  with  Statement  of  Financial  Accounting  Standards
("SFAS")  No. 144,  "Accounting  for the  Impairment  or Disposal of  Long-Lived
Assets," the Partnership  records impairment losses on long-lived assets used in
operations  when  events and  circumstances  indicate  that the assets  might be
impaired  and the  undiscounted  cash flows  estimated  to be generated by those
assets are less than the carrying  amounts of those  assets.  Costs of apartment
properties  that have  been  permanently  impaired  have  been  written  down to
appraised  value.  No  adjustments  for impairment of value were recorded in the
years ended December 31, 2002 and 2001.

During 2001, AIMCO, an affiliate of the Managing General Partner, commissioned a
project to study process improvement ideas to reduce operating costs. The result
of  the  study  led to a  re-engineering  of  business  processes  and  eventual
redeployment of personnel and related capital  spending.  The  implementation of
these plans  during  2002,  accounted  for as a change in  accounting  estimate,
resulted in a refinement of the Partnership's  process for capitalizing  certain
direct and  indirect  project  costs  (principally  payroll  related  costs) and
increased capitalization of such costs by approximately $69,000 in 2002 compared
to 2001.

Depreciation

Depreciation is provided by the straight-line method over the estimated lives of
the apartment  property and related  personal  property.  For Federal income tax
purposes,  the  accelerated  cost recovery  method is used (1) for real property
over 18 years for additions  after March 15, 1984 and before May 9, 1985, and 19
years for additions  after May 8, 1985,  and before January 1, 1987. As a result
of the Tax Reform Act of 1986,  for  additions  after  December  31,  1986,  the
modified  accelerated  cost recovery method is used for depreciation of (1) real
property over 27 1/2 years and (2) personal property additions over 5 years.

Cash and Cash Equivalents

Cash and cash  equivalents  include cash on hand and in banks. At certain times,
the amount of cash deposited at a bank may exceed the limit on insured deposits.
Cash  balances  include  approximately  $274,000 at  December  31, 2002 that are
maintained by an affiliated  management company on behalf of affiliated entities
in cash concentration accounts.

Loan Costs

Loan  costs of  approximately  $858,000  are  included  in other  assets  in the
accompanying  balance sheet and are being  amortized on a  straight-line  method
over the life of the loan.  At December 31, 2002,  accumulated  amortization  is
approximately  $54,000.  Amortization  of loan  costs is  included  in  interest
expense.  Amortization  expense is  expected to be $43,000 for each of the years
2003 through 2007.

Tenant Security Deposits

The Partnership  requires security deposits from lessees for the duration of the
lease.  Deposits are refunded when the tenant  vacates,  provided the tenant has
not damaged its space and is current on rental payments.

Fair Value of Financial Statements

SFAS No.  107,  "Disclosures  about Fair  Value of  Financial  Instruments",  as
amended by SFAS No. 119, "Disclosures about Derivative Financial Instruments and
Fair  Value  of  Financial  Instruments",  requires  disclosure  of  fair  value
information  about  financial  instruments,  whether  or not  recognized  in the
balance sheet, for which it is practicable to estimate fair value. Fair value is
defined in the SFAS as the amount at which the instruments could be exchanged in
a  current  transaction  between  willing  parties,  other  than in a forced  or
liquidation  sale.  The  Partnership  believes that the carrying  amounts of its
financial  instruments (except for long term debt) approximate their fair values
due to the short  term  maturity  of these  instruments.  The fair  value of the
Partnership's long term debt, after discounting the scheduled loan payments at a
borrowing rate currently available to the Partnership, approximates its carrying
balance.

Leases

The Partnership generally leases apartment units for twelve-month terms or less.
The  Partnership  recognizes  income as earned on leases and fully  reserves all
balances  outstanding  over thirty  days.  In  addition,  the  Managing  General
Partner's policy is to offer rental concessions during  particularly slow months
or in  response  to  heavy  competition  from  similar  complexes  in the  area.
Concessions are charged against rental income as incurred.

Allocation of Profits, Gains, and Losses

Profits,  gains, and losses of the Partnership are allocated between general and
limited partners in accordance with the provisions of the Partnership Agreement.

Income Taxes

Taxable income or loss of the  Partnership is reported in the income tax returns
of its  partners.  No  provision  for  income  taxes  is made  in the  financial
statements of the Partnership.

Advertising Costs

The Partnership expenses the cost of advertising as incurred.  Advertising costs
of  approximately  $34,000 and $47,000  during the years ended December 31, 2002
and 2001, respectively,  were charged to expense as incurred and are included in
operating expenses.

Segment Reporting

SFAS  No.  131,   "Disclosure  about  Segments  of  an  Enterprise  and  Related
Information"  established  standards  for the way  public  business  enterprises
report information about operating  segments in annual financial  statements and
requires that those  enterprises  report  selected  information  about operating
segments in interim financial reports. It also establishes standards for related
disclosures about products and services,  geographic areas, and major customers.
As defined in SFAS No. 131, the Partnership has only one reportable segment.

Recent Accounting Pronouncements

In August 2001, the Financial  Accounting  Standards  Board issued SFAS No. 144,
"Accounting for the Impairment or Disposal of Long-Lived  Assets".  SFAS No. 144
provides  accounting  guidance for  financial  accounting  and reporting for the
impairment or disposal of long-lived  assets.  SFAS No. 144 supersedes  SFAS No.
121,  "Accounting  for the  Impairment of Long-Lived  Assets and for  Long-Lived
Assets to be Disposed Of". SFAS No. 144 is effective for fiscal years  beginning
after December 15, 2001. The Partnership  adopted SFAS No. 144 effective January
1, 2002.  The adoption of which did not have a material  effect on the financial
position or results of operations of the Partnership.

In April 2002,  the Financial  Accounting  Standards  Board issued SFAS No. 145,
"Rescission of FASB  Statements  No. 4, 44 and 64". SFAS No. 4 "Reporting  Gains
and Losses from Extinguishment of Debt," required that all gains and losses from
extinguishment  of  debt  be  aggregated  and,  if  material,  classified  as an
extraordinary item. SFAS No. 145 rescinds SFAS No. 4, and accordingly, gains and
losses from extinguishment of debt should only be classified as extraordinary if
they are unusual in nature and occur  infrequently,  neither of which applies to
the Partnership.  SFAS 145 is effective for fiscal years beginning after May 15,
2002  with  early  adoption  as an  option.  The  Partnership  adopted  SFAS 145
effective April 1, 2002.  Accordingly the Partnership's  statement of operations
for the year ended

<PAGE>


Note B - Transactions with Affiliated Parties

December 31, 2001 has been restated to reflect the loss on early  extinguishment
of  debt of  approximately  $169,000  at  Village  of  Pennbrook  Apartments  in
operations rather than as an extraordinary item.

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 property management services based on a percentage of revenue and
for  reimbursement of certain  expenses  incurred by affiliates on behalf of the
Partnership.

Affiliates of the Managing  General  Partner are entitled to receive 5% of gross
receipts from the Partnership's  property as compensation for providing property
management  services.  The  Partnership  paid to such  affiliates  approximately
$381,000  for each of the years  ended  December  31,  2002 and  2001,  which is
included in operating expenses.

Affiliates of the Managing General Partner received reimbursement of accountable
administrative expenses amounting to approximately $160,000 and $209,000 for the
years  ended  December  31,  2002 and 2001,  respectively,  which is included in
general and administrative expenses.  Included in these amounts are fees related
to  construction  management  services  provided by an affiliate of the Managing
General Partner of approximately $6,000 and $44,000 for the years ended December
31, 2002 and 2001,  respectively.  The construction  management service fees are
calculated based on a percentage of current additions to investment property.

For services relating to the  administration of the Partnership and operation of
the Partnership's  property, the Managing General Partner is entitled to receive
payment for non-accountable  expenses up to a maximum of $100,000 per year based
upon the number of Partnership units sold, subject to certain  limitations.  The
Managing  General Partner  received  approximately  $55,000 and $100,000 for the
years  ended  December  31,  2002 and 2001,  respectively,  which is included in
general and administrative expenses.

In  addition  to the amounts  discussed  above,  as  compensation  for  services
rendered in managing the  Partnership,  the Managing General Partner is entitled
to receive a Partnership  Management Fee in conjunction  with  distributions  of
cash from  operations,  subject to certain  limitations.  During the years ended
December 31, 2002 and 2001,  approximately  $60,000 and $146,000,  respectively,
was  paid in  conjunction  with  the  operating  distributions.  These  fees are
included in general and administrative  expenses. An additional $28,000 was paid
during the year ended  December 31, 2002 which was included in accounts  payable
at December 31, 2001, and general and administrative expenses for the year ended
December 31, 2001.

The Partnership Agreement also provides for a commission to the Managing General
Partner  for  its  role  in  the  refinancing  of the  Partnership's  investment
property.  During the year ended  December  31,  2001,  the  Partnership  paid a
commission of  approximately  $304,000  related to the refinancing of Village of
Pennbrook Apartments. Such fee was capitalized and is included in other assets.

The Managing  General  Partner has made available to the  Partnership a $300,000
line of credit. At the present time, the Partnership has no outstanding  amounts
due under this line of credit.

Beginning in 2001,  the  Partnership  began  insuring its property up to certain
limits through coverage provided by AIMCO which is generally  self-insured for a
portion of losses and  liabilities  related  to workers  compensation,  property
casualty and vehicle liability.  The Partnership  insures its property above the
AIMCO  limits  through  insurance  policies  obtained  by  AIMCO  from  insurers
unaffiliated  with the General Partner.  During the year ended December 31, 2002
and 2001, the Partnership  paid AIMCO and its affiliates  approximately  $94,000
and $70,000,  respectively,  for  insurance  coverage and fees  associated  with
policy claims administration.

In addition to its  indirect  ownership of the general  partner  interest in the
Partnership,  AIMCO and its affiliates  owned 45,293 limited  partnership  units
(the "Units") in the Partnership representing 75.48% of the outstanding Units at
December  31,  2002.  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 acquire additional units of limited partnership  interest in the
Partnership  in  exchange  for cash or a  combination  of cash and  units in the
operating  partnership  of AIMCO  either  through  private  purchases  or tender
offers. Under the Partnership  Agreement,  unitholders holding a majority of the
Units are  entitled to take action  with  respect to a variety of matters  which
would  include  voting on certain  amendments to the  Partnership  Agreement and
voting to remove the Managing General  Partner.  As a result of its ownership of
75.48% of the  outstanding  Units,  AIMCO is in a position to influence all such
voting decisions with respect to the Partnership.  With respect to 26,466 units,
Insignia Properties,  LP, an affiliate of AIMCO, is required to vote such 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 unitholders. Except
for the  foregoing,  no other  limitations  are  imposed on AIMCO's or  Insignia
Properties,  L.P.'s  ability to influence  voting  decisions with respect to the
Partnership.  Although the Managing General Partner owes fiduciary duties to the
limited  partners of the  Partnership,  the Managing  General  Partner also owes
fiduciary duties to AIMCO as its sole  stockholder.  As a result,  the duties of
the Managing  General Partner,  as managing general partner,  to the Partnership
and its limited  partners may come into conflict with the duties of the Managing
General Partner to AIMCO, as its sole stockholder.

Note C - Mortgage Note Payable

The principal terms of the mortgage note payable are as follows:

<TABLE>
<CAPTION>

                          Principal     Monthly                           Principal
                         Balance At     Payment     Stated                 Balance
                        December 31,   Interest    Interest  Maturity      Due At
Property                    2002         Only        Rate      Date       Maturity
                             (in thousands)                            (in thousands)
Village of Pennbrook
<S>                        <C>           <C>        <C>      <C>   <C>      <C>
  Apartments               $29,425       $ 236      7.01%    09/01/21       $ --
</TABLE>

The  mortgage  note  payable  is  non-recourse  and is  secured by pledge of the
Partnership's  investment property and by pledge of revenues from the investment
property.  Prepayment penalties are imposed if the mortgage note is repaid prior
to  maturity.  Further,  the  property  may  not be  sold  subject  to  existing
indebtedness.

On August 31,  2001,  the  Partnership  refinanced  the  mortgage  note  payable
encumbering Village of Pennbrook  Apartments.  The refinancing replaced mortgage
indebtedness of $19,300,000 with a new mortgage of $30,400,000. The new mortgage
carries a stated  interest  rate of 7.01%  compared to a stated rate of 7.33% on
the old  mortgage.  Payments of principal and interest are due monthly until the
loan matures in September  2021 at which time the loan will be fully  amortized.
Loan  costs  capitalized  for  the  refinancing  were  approximately   $858,000,
including  a  $304,000  refinancing  fee paid to an  affiliate  of the  Managing
General Partner pursuant to the Partnership Agreement.  The Partnership recorded
a loss on early extinguishment of debt of approximately  $169,000 as a result of
unamortized loan costs being written off.

Scheduled  principal payments subsequent to December 31, 2002 are as follows (in
thousands):

                                   2003        $   725
                                   2004            845
                                   2005            906
                                   2006            972
                                   2007          1,043
                                Thereafter      24,934
                                               $29,425

Note D - Real Estate and Accumulated Depreciation

<TABLE>
<CAPTION>

                                                        Initial Cost
                                                       To Partnership
                                                       (in thousands)

                                                              Buildings        Cost
                                                             and Related    Capitalized
                                                              Personal     Subsequent to
Description                         Encumbrances     Land     Property      Acquisition
                                   (in thousands)                         (in thousands)
Village of Pennbrook Apartments
<S>                                    <C>         <C>         <C>            <C>
  Falls Township, Pennsylvania         $29,425     $ 1,972     $18,245        $ 8,593
</TABLE>


                      Gross Amount At Which Carried
                          At December 31, 2002
                             (in thousands)
<TABLE>
<CAPTION>

                                Buildings
                               And Related
                                Personal             Accumulated     Date    Depreciable
Description             Land    Property    Total    Depreciation  Acquired  Life-Years
                                                    (in thousands)
Village of Pennbrook
<S>                   <C>        <C>       <C>         <C>          <C>      <C>
  Apartments          $ 1,980    $26,830   $28,810     $(23,621)    12/81    5-27.5 yrs
</TABLE>

Reconciliation of "Real Estate and Accumulated Depreciation":

                                                    December 31,
                                                 2002          2001
                                                   (in thousands)
Investment Property
Balance at beginning of year                    $28,472       $27,789
  Property improvements                             338           683
Balance at end of year                          $28,810       $28,472

Accumulated Depreciation
Balance at beginning of year                    $22,355       $21,139
  Additions charged to expense                    1,266         1,216
Balance at end of year                          $23,621       $22,355


The  aggregate  cost of the real  estate  for  Federal  income tax  purposes  at
December  31,  2002  and  2001,  is  approximately  $6,380,000  and  $6,043,000,
respectively. The accumulated depreciation taken for Federal income tax purposes
at December  31, 2002 and 2001,  is  approximately  $1,861,000  and  $1,326,000,
respectively.

<PAGE>

Note E - Income Taxes

The  following is a  reconciliation  of reported net income and Federal  taxable
income (in thousands, except per unit data):

                                                December 31,
                                              2002         2001

Net income as reported                      $ 1,176       $ 986
Add (deduct):
  Depreciation differences                      731          697
  Prepaid rent                                   12           (7)
  Other                                          83          (60)

Federal taxable income                      $ 2,002      $ 1,616

Federal taxable income per limited
  partnership unit                          $ 33.03      $ 26.66

The following is a reconciliation between the Partnership's reported amounts and
Federal tax basis of net liabilities (in thousands):

                                                       2002

         Net liabilities as reported                $ (23,686)
         Land and buildings                           (22,430)
         Accumulated depreciation                      21,760
         Syndication and distribution costs             3,375
         Other                                            518

         Net liabilities - Federal tax basis         $(20,463)

Note F - 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. (the "Nuanes action") in the Superior Court of the
State of  California  for the  County  of San  Mateo.  The  plaintiffs  named as
defendants,  among others,  the  Partnership,  its 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,  among other
things,  the  acquisition  of  interests  in certain  Managing  General  Partner
entities by Insignia Financial Group, Inc. ("Insignia") and entities which were,
at one  time,  affiliates  of  Insignia;  past  tender  offers  by the  Insignia
affiliates to acquire limited partnership units;  management of the partnerships
by the  Insignia  affiliates;  and the series of  transactions  which  closed on
October 1, 1998 and February 26, 1999 whereby  Insignia and Insignia  Properties
Trust,  respectively,  were merged  into AIMCO.  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  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 court approval, on behalf of the Partnership and all
limited partners who owned units as of November 3, 1999. Preliminary approval of
the  settlement  was obtained on November 3, 1999 from the Court,  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 prior lead counsel to enter the settlement.  On
December 14, 1999, the Managing  General  Partner and its affiliates  terminated
the  proposed  settlement.  In  February  2000,  counsel  for some of the  named
plaintiffs filed a motion to disqualify plaintiff's lead and liaison counsel who
negotiated  the  settlement.  On June  27,  2000,  the  Court  entered  an order
disqualifying  them  from the case and an  appeal  was  taken  from the order on
October 5, 2000. On December 4, 2000, the Court  appointed the law firm of Lieff
Cabraser  Heimann & Bernstein  LLP as new lead  counsel for  plaintiffs  and the
putative class.  Plaintiffs filed a third amended complaint on January 19, 2001.
On March 2, 2001,  the  Managing  General  Partner  and its  affiliates  filed a
demurrer to the third amended  complaint.  On May 14, 2001,  the Court heard the
demurrer to the third amended  complaint.  On July 10, 2001, the Court issued an
order  sustaining  defendants'  demurrer on certain  grounds.  On July 20, 2001,
Plaintiffs filed a motion for reconsideration of the Court's July 10, 2001 order
granting in part and denying in part defendants' demurrer. On September 7, 2001,
Plaintiffs  filed a fourth amended class and  derivative  action  complaint.  On
September 12, 2001, the Court denied Plaintiffs' motion for reconsideration.  On
October 5, 2001, the Managing General Partner and affiliated  defendants filed a
demurrer to the fourth amended complaint,  which was heard on December 11, 2001.
On February 2, 2002,  the Court served its order  granting in part the demurrer.
The  Court has  dismissed  without  leave to amend  certain  of the  plaintiffs'
claims.  On February 11, 2002,  plaintiffs  filed a motion  seeking to certify a
putative  class  comprised of all  non-affiliated  persons who own or have owned
units  in  the  partnerships.   The  Managing  General  Partner  and  affiliated
defendants  oppose the motion.  On April 29,  2002,  the Court held a hearing on
plaintiffs' motion for class  certification and took the matter under submission
after further  briefing,  as ordered by the court, was submitted by the parties.
On July 10, 2002,  the Court entered an order vacating the current trial date of
January 13, 2003 (as well as the  pre-trial  and  discovery  cut-off  dates) and
stayed the case in its  entirety  through  November  7, 2002 so that the parties
could have an opportunity to discuss settlement.  On October 30, 2002, the court
entered an order extending the stay in effect through January 10, 2003.

On January 8, 2003,  the parties filed a  Stipulation  of Settlement in proposed
settlement of the Nuanes action and the Heller action described below. The Court
has  scheduled  the hearing on  preliminary  approval  for April 4, 2003 and the
hearing on final approval for June 2, 2003.

In general  terms,  the  proposed  settlement  provides  for  certification  for
settlement  purposes of a settlement class consisting of all limited partners in
this  Partnership and others (the  "Partnerships")  as of December 20, 2002, the
dismissal  with  prejudice  and  release  of claims  in the  Nuanes  and  Heller
litigation,  payment by AIMCO of $9.9  million  (which shall be  distributed  to
settlement  class  members  after  deduction of attorney fees and costs of class
counsel and certain costs of  settlement)  and up to $ 1 million toward the cost
of independent  appraisals of the Partnerships'  properties by a Court appointed
appraiser.  An affiliate of the Managing General Partner has also agreed to make
a tender offer to purchase all of the partnership  interests in the Partnerships
within one year of final  approval,  if it is granted,  and to provide  partners
with the  independent  appraisals  at the time of these  tenders.  The  proposed
settlement  also provides for the  limitation  of the allowable  costs which the
Managing  General  Partner or its  affiliates  will charge the  Partnerships  in
connection with this litigation and imposes limits on the class counsel fees and
costs in this  litigation.  If the  Court  grants  preliminary  approval  of the
proposed settlement in March, a notice will be distributed to partners providing
detail on the terms of the proposed settlement.

During the third  quarter of 2001, a complaint  (the "Heller  action") was filed
against  the same  defendants  that are named in the  Nuanes  action,  captioned
Heller v. Insignia Financial Group. On or about August 6, 2001, plaintiffs filed
a first amended  complaint.  The first amended complaint in the Heller action is
brought as a purported  derivative  action,  and asserts  claims for among other
things  breach  of  fiduciary  duty;  unfair  competition;   conversion,  unjust
enrichment;  and judicial  dissolution.  Plaintiffs in the Nuanes action filed a
motion to  consolidate  the Heller action with the Nuanes action and stated that
the Heller action was filed in order to preserve the derivative claims that were
dismissed  without  leave to amend in the Nuanes action by the Court order dated
July 10, 2001. On October 5, 2001, the Managing  General  Partner and affiliated
defendants  moved to strike the first  amended  complaint  in its  entirety  for
violating  the Court's July 10, 2001 order  granting in part and denying in part
defendants'  demurrer in the Nuanes action, or alternatively,  to strike certain
portions of the complaint based on the statute of limitations.  Other defendants
in the action  demurred to the fourth  amended  complaint,  and,  alternatively,
moved to strike the complaint. On December 11, 2001, the court heard argument on
the motions  and took the matters  under  submission.  On February 4, 2002,  the
Court  served  notice of its order  granting  defendants'  motion to strike  the
Heller complaint as a violation of its July 10, 2001 order in the Nuanes action.
On March 27, 2002,  the plaintiffs  filed a notice  appealing the order striking
the  complaint.  Before  completing  briefing on the appeal,  the parties stayed
further proceedings in the appeal pending the Court's review of the terms of the
proposed settlement described above.

Estate of Harry  Schubert v.  National  Property  Investors  4, Civil Action No.
97-09129, Court of Common Pleas of Bucks County, Pennsylvania.  During 1998, the
Plaintiff brought action against the Partnership  alleging that as the result of
carbon monoxide and methane  poisoning due to a malfunctioning  heat unit in the
apartment at the  Partnership's  property,  which was leased by decedent's  son,
thedecedent lost consciousness for several hours,  suffered  respiratory arrest,
and suffered other pains and injuries. The Plaintiff alleges breach of contract,
fraud,  violations of the Unfair Trade Practices and Consumer Protection Law and
negligence resulting in wrongful death. This matter is in the discovery phase of
litigation. The Partnership is vigorously defending this matter.

The  Managing  General  Partner  does  not  anticipate  that  any  costs  to the
Partnership, whether legal or settlement costs, associated with these cases 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 8.     Changes in and Disagreements  with  Accountants  on  Accounting  and
            Financial Disclosures

            None.

<PAGE>

                                    PART III

Item 9.     Directors, Executive Officers,   Promoters   and  Control   Persons;
            Compliance with Section 16(a) of the Exchange Act

The Partnership has no officers or directors.  NPI Equity,  the Managing General
Partner,  manages substantially all of the Partnership's affairs and has general
responsibility  in all matters  affecting its  business.  NPI Equity is a wholly
owned subsidiary of AIMCO.

The  name of the  directors  and  executive  officers  of the  Managing  General
Partner,  their age and the nature of all  positions  with NPI Equity  presently
held by them are set forth below. There are no family  relationships  between or
among any officers and directors.

Name                        Age    Position

Patrick J. Foye              45    Executive Vice President and Director

Paul J. McAuliffe            46    Executive Vice President and Chief
                                     Financial Officer

Thomas C. Novosel            44    Senior Vice President and Chief Accounting
                                     Officer

Patrick J. Foye has been  Executive  Vice President and Director of the Managing
General  Partner  since October 1, 1998.  Mr. Foye has served as Executive  Vice
President  of AIMCO  since  May 1998,  where he is  responsible  for  continuous
improvement,  acquisitions of partnership securities,  consolidation of minority
interests,  and corporate and other  acquisitions.  Prior to joining AIMCO,  Mr.
Foye was a Merger and  Acquisitions  Partner in the law firm of  Skadden,  Arps,
Slate, Meagher & Flom LLP from 1989 to 1998.

Paul J. McAuliffe has been Executive Vice President and Chief Financial  Officer
of the Managing General Partner since April 1, 2002. Mr. McAuliffe has served as
Executive  Vice  President  of AIMCO  since  February  1999 and Chief  Financial
Officer of AIMCO since  October 1999.  From May 1996 until he joined AIMCO,  Mr.
McAuliffe was Senior Managing Director of Secured Capital Corp.

Thomas C. Novosel has been Senior Vice President and Chief Accounting Officer of
the Managing  General  Partner  since April 1, 2002.  Mr.  Novosel has served as
Senior Vice  President and Chief  Accounting  Officer of AIMCO since April 2000.
From October 1993 until he joined  AIMCO,  Mr.  Novosel was a partner at Ernst &
Young LLP, where he served as the director of real estate advisory  services for
the  southern  Ohio  Valley  area  offices  but did not work on any  assignments
related to AIMCO or the Partnership.

One or more of the above persons are also directors and/or officers of a general
partner (or general partner of a general partner) of limited  partnerships which
either have a class of  securities  registered  pursuant to Section 12(g) of the
Securities Exchange Act of 1934, or are subject to the reporting requirements of
Section  15(d) of such Act:  Further,  one or more of the above persons are also
directors and/or officers of Apartment Investment and Management Company and the
general  partner  of  AIMCO  Properties,  L.P.,  entities  that  have a class of
securities  registered  pursuant to Section 12(g) of the Securities Exchange Act
of 1934, or are subject to the reporting  requirements of Section 15 (d) of such
Act.

The executive  officers and director of the Managing General Partner fulfill the
obligations  of the Audit  Committee  and  oversee the  Partnership's  financial
reporting process on behalf of the Managing General Partner.  Management has the
primary  responsibility  for the financial  statements and the reporting process
including  the  systems  of  internal  controls.  In  fulfilling  its  oversight
responsibilities,  the executive  officers and director of the Managing  General
Partner reviewed the audited  financial  statements with management  including a
discussion  of the  quality,  not  just  the  acceptability,  of the  accounting
principles,  the  reasonableness  of significant  judgments,  and the clarity of
disclosures in the financial statements.

The executive  officers and director of the Managing  General  Partner  reviewed
with the independent auditors,  who are responsible for expressing an opinion on
the conformity of those audited financial statements with accounting  principles
generally accepted in the United States,  their judgments as to the quality, not
just the  acceptability,  of the  Partnership's  accounting  principles and such
other  matters as are required to be discussed  with the Audit  Committee or its
equivalent under auditing standards  generally accepted in the United States. In
addition,  the  Partnership  has  discussed  with the  independent  auditors the
auditors' independence from management and the Partnership including the matters
in the written  disclosures  required by the  Independence  Standards  Board and
considered  the   compatibility   of  non-audit   services  with  the  auditors'
independence.

The executive  officers and director of the Managing  General Partner  discussed
with the  Partnership's  independent  auditors  the overall  scope and plans for
their audit. In reliance on the reviews and discussions  referred to above,  the
executive  officers and director of the Managing  General  Partner have approved
the  inclusion of the audited  financial  statements  in the Form 10-KSB for the
year  ended  December  31,  2002 for filing  with the  Securities  and  Exchange
Commission.

The Managing  General Partner has  reappointed  Ernst & Young LLP as independent
auditors to audit the financial statements of the Partnership for 2003. Fees for
2002 were annual audit services of approximately  $30,000 and non-audit services
(principally tax-related) of approximately $14,000.

Item 10.    Executive Compensation

Neither the director nor the officers of the Managing  General Partner  received
any  remuneration  from the Registrant  during the years ended December 31, 2002
and 2001.

Item 11.    Security Ownership of Certain Beneficial Owners and Management

Except as noted below, as of December 31, 2002, no person or entity was known to
own of  record  or  beneficially  more  than  five  percent  of the Units of the
Partnership.

                                             Number of         Percent
                                               Units          of Total
Insignia Properties, L.P.                     32,525           54.20%
  (an affiliate of AIMCO)
IPLP Acquisition I, LLC                        4,452            7.42%
  (an affiliate of AIMCO)
AIMCO Properties, L.P.                         8,316           13.86%
  (an affiliate of AIMCO)

Insignia Properties,  L.P. and IPLP Acquisition I, LLC are indirectly ultimately
owned by AIMCO.  Their  business  address is 55 Beattie  Place,  Greenville,  SC
29602.

<PAGE>


AIMCO  Properties,  L.P.  is  indirectly  ultimately  controlled  by AIMCO.  Its
business  address is Stanford Place 3, 4582 S. Ulster St.  Parkway,  Suite 1100,
Denver, CO 80237.

No director or officer of the Managing General Partner owns any Units.

Item 12.    Certain Relationships and Related Transactions

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 property management services based on a percentage of revenue and
for  reimbursement of certain  expenses  incurred by affiliates on behalf of the
Partnership.

Affiliates of the Managing  General  Partner are entitled to receive 5% of gross
receipts from the Partnership's  property as compensation for providing property
management  services.  The  Partnership  paid to such  affiliates  approximately
$381,000  for each of the years  ended  December  31,  2002 and  2001,  which is
included in operating expenses.

Affiliates of the Managing General Partner received reimbursement of accountable
administrative expenses amounting to approximately $160,000 and $209,000 for the
years  ended  December  31,  2002 and 2001,  respectively,  which is included in
general and administrative expenses.  Included in these amounts are fees related
to  construction  management  services  provided by an affiliate of the Managing
General Partner of approximately $6,000 and $44,000 for the years ended December
31, 2002 and 2001,  respectively.  The construction  management service fees are
calculated based on a percentage of current additions to investment property.

For services relating to the  administration of the Partnership and operation of
the Partnership's  property, the Managing General Partner is entitled to receive
payment for non-accountable  expenses up to a maximum of $100,000 per year based
upon the number of Partnership units sold, subject to certain  limitations.  The
Managing  General Partner  received  approximately  $55,000 and $100,000 for the
years  ended  December  31,  2002 and 2001,  respectively,  which is included in
general and administrative expenses.

In  addition  to the amounts  discussed  above,  as  compensation  for  services
rendered in managing the  Partnership,  the Managing General Partner is entitled
to receive a Partnership  Management Fee in conjunction  with  distributions  of
cash from  operations,  subject to certain  limitations.  During the years ended
December 31, 2002 and 2001,  approximately  $60,000 and $146,000,  respectively,
was  paid in  conjunction  with  the  operating  distributions.  These  fees are
included in general and administrative  expenses. An additional $28,000 was paid
during the year ended  December 31, 2002 which was included in accounts  payable
at December 31, 2001, and general and administrative expenses for the year ended
December 31, 2001.

The Partnership Agreement also provides for a commission to the Managing General
Partner  for  its  role  in  the  refinancing  of the  Partnership's  investment
property.  During the year ended  December  31,  2001,  the  Partnership  paid a
commission of  approximately  $304,000  related to the refinancing of Village of
Pennbrook Apartments. Such fee was capitalized and is included in other assets.

The Managing  General  Partner has made available to the  Partnership a $300,000
line of credit. At the present time, the Partnership has no outstanding  amounts
due under this line of credit.

Beginning in 2001,  the  Partnership  began  insuring its property up to certain
limits through coverage provided by AIMCO which is generally  self-insured for a
portion of losses and  liabilities  related  to workers  compensation,  property
casualty and vehicle liability.  The Partnership  insures its property above the
AIMCO  limits  through  insurance  policies  obtained  by  AIMCO  from  insurers
unaffiliated  with the General Partner.  During the year ended December 31, 2002
and 2001, the Partnership  paid AIMCO and its affiliates  approximately  $94,000
and $70,000,  respectively,  for  insurance  coverage and fees  associated  with
policy claims administration.

In addition to its  indirect  ownership of the general  partner  interest in the
Partnership,  AIMCO and its affiliates  owned 45,293 limited  partnership  units
(the "Units") in the Partnership representing 75.48% of the outstanding Units at
December  31,  2002.  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 acquire additional units of limited partnership  interest in the
Partnership  in  exchange  for cash or a  combination  of cash and  units in the
operating  partnership  of AIMCO  either  through  private  purchases  or tender
offers. Under the Partnership  Agreement,  unitholders holding a majority of the
Units are  entitled to take action  with  respect to a variety of matters  which
would  include  voting on certain  amendments to the  Partnership  Agreement and
voting to remove the Managing General  Partner.  As a result of its ownership of
75.48% of the  outstanding  Units,  AIMCO is in a position to influence all such
voting decisions with respect to the Partnership.  With respect to 26,466 units,
Insignia Properties,  LP, an affiliate of AIMCO, is required to vote such 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 unitholders. Except
for the  foregoing,  no other  limitations  are  imposed on AIMCO's or  Insignia
Properties,  L.P.'s  ability to influence  voting  decisions with respect to the
Partnership.  Although the Managing General Partner owes fiduciary duties to the
limited  partners of the  Partnership,  the Managing  General  Partner also owes
fiduciary duties to AIMCO as its sole  stockholder.  As a result,  the duties of
the Managing  General Partner,  as managing general partner,  to the Partnership
and its limited  partners may come into conflict with the duties of the Managing
General Partner to AIMCO, as its sole stockholder.

Item 13.    Exhibits and Reports on Form 8-K

      (a)   Exhibits:

            See Exhibit Index.

      (b) Reports on Form 8-K:

            None filed during the quarter ended December 31, 2002.

ITEM 14.    Controls and Procedures

The principal  executive officer and principal financial officer of the Managing
General Partner, who are the equivalent of the Partnership's principal executive
officer and principal financial officer,  respectively,  have, within 90 days of
the filing  date of this  annual  report,  evaluated  the  effectiveness  of the
Partnership's  disclosure  controls and  procedures  (as defined in Exchange Act
Rules 13a-14(c) and 15d-14(c)) and have determined that such disclosure controls
and  procedures  are  adequate.  There have been no  significant  changes in the
Partnership's  internal  controls or in other  factors that could  significantly
affect the  Partnership's  internal  controls since the date of evaluation.  The
Partnership does not believe any significant deficiencies or material weaknesses
exist in the Partnership's internal controls. Accordingly, no corrective actions
have been taken.


<PAGE>



                                   SIGNATURES


In accordance  with Section 13 or 15(d) of the Exchange Act, the  Registrant has
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


                                    NATIONAL PROPERTY INVESTORS 4


                                    By:   NPI EQUITY INVESTMENTS, INC.
                                          Managing General Partner


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


                                    By:   /s/Thomas C. Novosel
                                          Thomas C. Novosel
                                          Senior Vice President
                                          and Chief Accounting Officer


                                    Date: March 26, 2003


In  accordance  with the Exchange  Act, this report has been signed below by the
following  persons on behalf of the Partnership and in the capacities and on the
dates indicated.


/s/Patrick J. Foye            Executive Vice President      Date: March 26, 2003
Patrick J. Foye               and Director


/s/Thomas C. Novosel          Senior Vice President         Date: March 26, 2003
Thomas C. Novosel             and Chief Accounting Officer

<PAGE>

                                  CERTIFICATION


I, Patrick J. Foye, certify that:


1. I have  reviewed  this  annual  report on Form  10-KSB of  National  Property
Investors 4;


2.  Based on my  knowledge,  this  annual  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;


3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this annual report;


4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:


      a)  Designed  such  disclosure  controls  and  procedures  to ensure  that
      material   information   relating  to  the   registrant,   including   its
      consolidated  subsidiaries,  is made  known to us by others  within  those
      entities,  particularly  during the period in which this annual  report is
      being prepared;


      b) Evaluated the effectiveness of the registrant's disclosure controls and
      procedures  as of a date  within 90 days prior to the filing  date of this
      annual report (the "Evaluation Date"); and


      c) Presented in this annual report our conclusions about the effectiveness
      of the disclosure  controls and  procedures  based on our evaluation as of
      the Evaluation Date;


5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's   board  of  directors  (or  persons   performing   the  equivalent
functions):


      a) All  significant  deficiencies  in the design or  operation of internal
      controls which could adversely affect the registrant's  ability to record,
      process,  summarize and report  financial data and have identified for the
      registrant's auditors any material weaknesses in internal controls; and


      b) Any fraud,  whether or not material,  that involves management or other
      employees  who  have  a  significant  role  in the  registrant's  internal
      controls; and


6. The  registrant's  other  certifying  officers  and I have  indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.


Date:  March 26, 2003

                               /s/Patrick J. Foye
                               Patrick J. Foye
                               Executive   Vice   President   of   NPI   Equity
                               Investments,   Inc.,  equivalent  of  the  chief
                               executive officer of the Partnership


<PAGE>



                                  CERTIFICATION


I, Paul J. McAuliffe, certify that:


1. I have  reviewed  this  annual  report on Form  10-KSB of  National  Property
Investors 4;


2.  Based on my  knowledge,  this  annual  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;


3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this annual report;


4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:


      a)  Designed  such  disclosure  controls  and  procedures  to ensure  that
      material   information   relating  to  the   registrant,   including   its
      consolidated  subsidiaries,  is made  known to us by others  within  those
      entities,  particularly  during the period in which this annual  report is
      being prepared;


      b) Evaluated the effectiveness of the registrant's disclosure controls and
      procedures  as of a date  within 90 days prior to the filing  date of this
      annual report (the "Evaluation Date"); and


      c) Presented in this annual report our conclusions about the effectiveness
      of the disclosure  controls and  procedures  based on our evaluation as of
      the Evaluation Date;


5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's   board  of  directors  (or  persons   performing   the  equivalent
functions):


      a) All  significant  deficiencies  in the design or  operation of internal
      controls which could adversely affect the registrant's  ability to record,
      process,  summarize and report  financial data and have identified for the
      registrant's auditors any material weaknesses in internal controls; and


      b) Any fraud,  whether or not material,  that involves management or other
      employees  who  have  a  significant  role  in the  registrant's  internal
      controls; and


6. The  registrant's  other  certifying  officers  and I have  indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.


Date:  March 26, 2003

                                 /s/Paul J. McAuliffe
                                 Paul J. McAuliffe
                                 Executive Vice President and Chief Financial
                                 Officer of NPI Equity Investments, Inc.,
                                 equivalent of the chief financial officer of
                                 the Partnership


<PAGE>


                                  EXHIBIT INDEX

Exhibit

          2.1  NPI, Inc. Stock Purchase  Agreement  dated as of August 17, 1995,
               incorporated by reference to the Partnership's  Current Report on
               Form 8-K dated August 17, 1995.

          2.2  Partnership Units Purchase  Agreement dated as of August 17, 1995
               incorporated  by  reference  to Exhibit  2.1 to Form 8-K filed by
               Insignia  Financial Group, Inc.  ("Insignia") with the Securities
               and Exchange Commission on September 1, 1995.

          2.3  Management  Purchase  Agreement  dated  as of  August  17,  1995,
               incorporated  by  reference  to Exhibit  2.2 to Form 8-K filed by
               Insignia  Financial Group,  Inc. with the Securities and Exchange
               Commission on September 1, 1995.

          2.4  Agreement and Plan of Merger, dated as of October 1, 1999, by and
               between  AIMCO  and IPT shown as  Exhibit  2.1 in 8-K dated as of
               October 1, 1988.

          2.5  Master   Indemnity   Agreement  dated  as  of  August  17,  1995,
               incorporated  by  reference  to Exhibit  2.5 to Form 8-K filed by
               Insignia with the Securities and Exchange Commission on September
               1, 1995.

          3.4  Agreement of Limited  Partnership,  incorporated  by reference to
               Exhibit A to the Prospectus of the  Partnership  dated  September
               20,  1983,  as  amended  on  June  13  1989,  and  as  thereafter
               supplemented   contained   in  the   Partnership's   Registration
               Statement on Form S-11 (Reg. No. 2-63733).

          10.1 Agreement  to  Purchase  Village of  Pennbrook  Apartments  dated
               November  25,  1981  between  the  Partnership  and SB  Partners,
               incorporated  by reference  to the Exhibits to the  Partnership's
               Current Report on Form 8-K dated November 25, 1981.

          10.4 Property Management Agreement dated June 21, 1991, by and between
               the Partnership  and NPI Management  incorporated by reference to
               Exhibit 10.4 to the Partnership's  Annual Report on Form 10-K for
               the year ended December 31, 1991.

          10.5 Multifamily  Note dated  September  30, 1996,  by and between the
               Partnership and Lehman Brothers Holding,  Inc. for the Village of
               Pennbrook  incorporated  by  reference  to  Exhibit  10.5  to the
               Partnership's  Annual  Report  on Form  10-K for the  year  ended
               December 31, 1996.

          10.6 Multifamily  Note dated  November  1, 1996,  by and  between  the
               Partnership and Lehman Brothers Holding,  Inc. for the Village of
               Pennbrook  incorporated  by  reference  to  Exhibit  10.6  to the
               Partnership's  Annual  Report  on Form  10-K for the  year  ended
               December 31, 1991.

<PAGE>

          10.7 Multifamily  Note dated August 30, 2001, by and between  National
               Property Investors 4, a California limited partnership,  and GMAC
               Commercial  Mortgage   Corporation,   a  California   corporation
               initially  filed as Exhibit 10.7 to the  Registrant's  Form 10QSB
               for the quarter ended September 30, 2001 and incorporated  herein
               by reference.

          99   Certification  of Chief  Executive  Officer  and Chief  Financial
               Officer.


<PAGE>

Exhibit 99


                          Certification of CEO and CFO
                       Pursuant to 18 U.S.C. Section 1350,
                             As Adopted Pursuant to
                   Section 906 of the Sarbanes-Oxley Act of 2002



In  connection  with the  Annual  Report  on Form  10-KSB of  National  Property
Investors 4 (the  "Partnership"),  for the year ended December 31, 2002 as filed
with the Securities and Exchange  Commission on the date hereof (the  "Report"),
Patrick  J.  Foye,  as the  equivalent  of the Chief  Executive  Officer  of the
Partnership,  and Paul J.  McAuliffe,  as the equivalent of the Chief  Financial
Officer of the Partnership, each hereby certifies, pursuant to 18 U.S.C. Section
1350,  as adopted  pursuant  to Section 906 of the  Sarbanes-Oxley  Act of 2002,
that, to the best of his knowledge:

      (1)   The Report fully complies with the  requirements of Section 13(a) or
            15(d) of the Securities Exchange Act of 1934; and

      (2)   The  information  contained in the Report  fairly  presents,  in all
            material respects, the financial condition and results of operations
            of the Partnership.


                                           /s/Patrick J. Foye
                                    Name:  Patrick J. Foye
                                    Date:  March 26, 2003


                                           /s/Paul J. McAuliffe
                                    Name:  Paul J. McAuliffe
                                    Date:  March 26, 2003


This  certification  accompanies  the  Report  pursuant  to  Section  906 of the
Sarbanes-Oxley  Act of 2002 and shall not,  except to the extent required by the
Sarbanes-Oxley  Act of 2002, be deemed filed by the  Partnership for purposes of
Section 18 of the Securities Exchange Act of 1934, as amended.