UNITED STATES
                       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, 2004


[ ]   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.  $7,924,000

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, 2004. 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

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.  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;  litigation,  including  costs  associated  with  prosecuting  and
defending  claims  and  any  adverse   outcomes,   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 Managing General
Partner is  currently  evaluating  an extension  of the  Partnership's  term and
expects to have any such extension completed by the end of 2005.

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,  these  factors
include,  but are not limited  to,  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.

From time to time, the Federal Bureau of  Investigation,  or FBI, and the United
States  Department  of  Homeland  Security  issue  alerts  regarding   potential
terrorist threats  involving  apartment  buildings.  Threats of future terrorist
attacks,  such as those  announced  by the FBI and the  Department  of  Homeland
Security,  could  have a  negative  effect on rent and  occupancy  levels at the
Partnership's  property.  The effect that future terrorist activities or threats
of such activities could have on the  Partnership's  operations is uncertain and
unpredictable. If the Partnership were to incur a loss at a property as a result
of an act of  terrorism,  the  Partnership  could  lose all or a portion  of the
capital  invested  in the  property,  as well as the  future  revenue  from  the
property.  In this regard, the Partnership has purchased insurance to cover acts
of terrorism.  The Managing General Partner does not anticipate that these costs
will have a negative effect on the Partnership's  financial condition or results
of operations.

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.

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              $30,754     $25,412    5-27.5 yrs    S/L        $ 5,035
</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 fixed rate
loan encumbering the Partnership's property.
<TABLE>
<CAPTION>

                       Principal                                            Principal
                      Balance At             Stated                          Balance
                     December 31,  Monthly  Interest   Period   Maturity      Due At
Property                 2004      Payment    Rate    Amortized   Date       Maturity
                         (in thousands)                                   (in thousands)
Village of Pennbrook
<S>                     <C>         <C>       <C>        <C>    <C>   <C>      <C>
  Apartments            $27,855     $ 236     7.01%      20     09/01/21       $ --
</TABLE>

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


<PAGE>



Rental Rates and Occupancy

Average annual rental rates and occupancy for 2004 and 2003 for the property:

                                    Average Annual
                                     Rental Rates                   Average
                                      (per unit)                   Occupancy
 Property                        2004            2003           2004        2003
 Village of Pennbrook
   Apartments                   $11,104         $10,485         93%          94%

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 2004 for the property:

                                              2004              2004
                                             Billing            Rate
                                         (in thousands)
       Village of Pennbrook
         Apartments                           $621             5.75%

Capital Improvements

During the year ended December 31, 2004, the Partnership completed approximately
$1,377,000 of capital  improvements at Village of Pennbrook consisting primarily
of  floor  coverings,  appliance  replacements,  heating  and  air  conditioning
improvements,  water and sewer upgrades,  and exterior  painting.  These capital
improvements  were funded primarily from operating cash flow and an advance from
an  affiliate  of  the  Managing  General  Partner.  The  Partnership  regularly
evaluates the capital  improvement needs of the property.  While the Partnership
has no material commitments for property improvements and replacements,  certain
routine  capital   expenditures  are  anticipated   during  2005.  Such  capital
expenditures  will depend on the  physical  condition of the property as well as
anticipated cash flow 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
purported  to  assert  claims  on  behalf  of a class of  limited  partners  and
derivatively  on behalf  of a number  of  limited  partnerships  (including  the
Partnership)  that 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 that 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  sought  monetary
damages and equitable relief, including judicial dissolution of the Partnership.
In addition,  during the third quarter of 2001, a complaint  captioned Heller v.
Insignia  Financial  Group (the  "Heller  action")  was filed  against  the same
defendants  that are named in the  Nuanes  action.  On or about  August 6, 2001,
plaintiffs filed a first amended  complaint.  The Heller action was brought as a
purported derivative action, and asserted claims for, among other things, breach
of fiduciary  duty,  unfair  competition,  conversion,  unjust  enrichment,  and
judicial dissolution.

On January 8, 2003,  the parties filed a  Stipulation  of Settlement in proposed
settlement of the Nuanes action and the Heller action.

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
at least one round of tender offers 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 provided 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.  On April  11,  2003,  notice  was
distributed  to  limited   partners   providing  the  details  of  the  proposed
settlement.

On June 13, 2003, the court granted final approval of the settlement and entered
judgment in both the Nuanes and Heller actions.  On August 12, 2003, an objector
("Objector") filed an appeal (the "Appeal") seeking to vacate and/or reverse the
order approving the settlement and entering  judgment  thereto.  On November 24,
2003,  the Objector  filed an  application  requesting  the court order AIMCO to
withdraw settlement tender offers it had commenced,  refrain from making further
offers  pending  the appeal and auction  any units  tendered  to third  parties,
contending  that the offers did not  conform  with the terms of the  settlement.
Counsel  for the  Objector  (on behalf of another  investor)  had  alternatively
requested the court take certain action  purportedly to enforce the terms of the
settlement agreement. On December 18, 2003, the court heard oral argument on the
motions  and denied them both in their  entirety.  The  Objector  filed a second
appeal challenging the court's use of a referee and its order requiring Objector
to pay those fees.

On January 28, 2004,  the  Objector  filed his opening  brief in the Appeal.  On
April 23, 2004, the Managing General Partner and its affiliates filed a response
brief in support of the settlement and the judgment thereto. The plaintiffs have
also filed a brief in support of the settlement. On June 4, 2004, Objector filed
a reply to the briefs  submitted by the Managing General Partner and Plaintiffs.
In addition both the Objector and plaintiffs filed briefs in connection with the
second  appeal.  The Court of Appeals  heard oral  argument  on both  appeals on
September 22, 2004 and took the matters under submission.

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.

As previously  disclosed both AIMCO Properties L.P. and NHP Management  Company,
both affiliates of the Managing General Partner,  are defendants in an action in
the United States  District  Court,  District of Columbia.  The plaintiffs  have
styled their complaint as a collective action under the Fair Labor Standards Act
("FLSA") and seek to certify state subclasses in California,  Maryland,  and the
District of Columbia. Specifically, the plaintiffs contend that AIMCO Properties
L.P. failed to compensate  maintenance  workers for time that they were required
to be "on-call". Additionally, plaintiffs allege AIMCO Properties L.P. failed to
comply  with the FLSA in  compensating  maintenance  workers  for time that they
worked in responding to a call while  "on-call".  The  defendants  have filed an
answer to the amended complaint denying the substantive  allegations.  Discovery
relating  to the  certification  of the  collective  action  has  concluded  and
briefing on the matter is underway.  Although the outcome of any  litigation  is
uncertain,  AIMCO  Properties,  L.P. does not believe that the ultimate  outcome
will have a material  adverse  effect on its  financial  condition or results of
operations.  Similarly,  the Managing  General Partner does not believe that the
ultimate  outcome  will have a  material  adverse  effect  on the  Partnership's
financial condition or results of operations.

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

During the quarter ended  December 31, 2004, 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 70,000 and sold
60,005 limited  partnership  units aggregating  $30,002,500.  As of December 31,
2004, the Partnership had 60,005 units  outstanding held by 961 limited partners
of record.  Affiliates  of the Managing  General  Partner  owned 47,442 units or
79.06% at December 31, 2004.  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, 2004 and 2003 (in thousands, except per unit data):

<TABLE>
<CAPTION>

                                        Per Limited                       Per Limited
                       Year Ended       Partnership       Year Ended      Partnership
                    December 31, 2004      Unit       December 31, 2003       Unit

<S>                      <C>              <C>               <C>              <C>
Operations               $ 1,158          $19.09            $ 510            $ 8.42
</TABLE>

Future  cash  distributions  will  depend on the levels of cash  generated  from
operations,  the  timing  of the  debt  maturity,  sale of the  property  and/or
refinancing.  The Partnership's cash available for distribution 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 2005 or  subsequent  periods.  See  "Item 2.
Description  of Property - Capital  Improvements"  for  information  relating to
capital expenditures at the property.

In addition to its  indirect  ownership of the general  partner  interest in the
Partnership,  AIMCO and its affiliates  owned 47,442 limited  partnership  units
(the "Units") in the Partnership representing 79.06% of the outstanding Units at
December  31,  2004.  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 AIMCO
Properties,  L.P., the operating  partnership of AIMCO,  either through  private
purchases or tender offers.  Pursuant to the Partnership Agreement,  unitholders
holding a majority of the Units are  entitled  to take action with  respect to a
variety of matters  that  include,  but are not  limited  to,  voting on certain
amendments  to the  Partnership  Agreement  and  voting to remove  the  Managing
General  Partner.  As a result of its  ownership  of  79.06% 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,  AIMCO IPLP, L.P. 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 AIMCO IPLP,  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.


<PAGE>


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.

The  Partnership's  financial  results depend upon a number of factors including
the ability to attract and maintain tenants at the investment property, interest
rates on mortgage  loans,  costs  incurred to operate the  investment  property,
general economic conditions and weather. 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,   the  Managing  General  Partner  may  use  rental
concessions and rental rate reductions to offset  softening  market  conditions,
accordingly,  there is no guarantee  that the Managing  General  Partner will be
able to sustain such a plan.  Further,  a number of factors that are outside the
control of the  Partnership  such as the local economic  climate and weather can
adversely or positively affect the Partnership's financial results.

Results of Operations

The  Partnership  recognized  net income for the year ended December 31, 2004 of
approximately  $1,742,000 compared to net income of approximately $1,010,000 for
the same period in 2003.  The increase in net income for the year ended December
31, 2004 is  attributable  to an increase  in total  revenues  and a decrease in
total expenses.

The increase in total revenues for the year ended December 31, 2004 is due to an
increase in rental  income and other income.  Rental income  increased due to an
increase in the average rental rate at the Partnership's property as a result of
a  decrease  in  concessions.  Other  income  increased  due  primarily  to  the
Partnership's investment property now charging for utility reimbursements and an
increase  in cable TV  reimbursements,  partially  offset by a decrease  in late
charges at the property.

The decrease in total  expenses  for the year ended  December 31, 2004 is due to
decreases in depreciation and interest expenses partially offset by increases in
operating,  property tax and general and administrative  expenses.  Depreciation
expense  decreased due to assets becoming fully depreciated over the past twelve
months.  Interest  expense  decreased due to the payment of scheduled  principal
payments on the mortgage  encumbering  the  Partnership's  investment  property,
which has reduced the average  outstanding  balance over the past twelve months.
Operating  expenses increased due to an increase in property,  maintenance,  and
property management fee expense.  Property expenses increased due to an increase
in utility  expenses and an increase in payroll and related  employee  benefits.
Maintenance  expense  increased  due to an  increase in  contract  services  and
maintenance  supplies at the  Partnership's  investment  property.  The property
management  fee  increased  due to an increase in rental  income.  Property  tax
expense increased due to an increase in the tax rate charged by the local taxing
authorities.  The  increase in general and  administrative  expense is due to an
increase  in  Partnership  management  fees and  non-accountable  reimbursements
associated  with  distributions,  slightly  offset by a decrease  in  management
reimbursements as a result of lower costs.



<PAGE>


Included in general and  administrative  expenses at both  December 31, 2004 and
2003 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.

Liquidity and Capital Resources

At  December  31,  2004,  the  Partnership  had  cash and  cash  equivalents  of
approximately  $134,000 compared to approximately $760,000 at December 31, 2003,
a decrease of  approximately  $626,000.  The  decrease  is due to  approximately
$1,684,000  and  $1,108,000 of cash used in financing and investing  activities,
respectively,  partially offset by approximately  $2,166,000 of cash provided by
operating   activities.   Cash  used  in  financing   activities   consisted  of
distributions paid to partners and payments made on the mortgage encumbering the
Partnership's  property  partially  offset by the receipt of an advance  from an
affiliate.  Cash used in investing activities consisted of property improvements
and  replacements.  The  Partnership  invests  its working  capital  reserves in
interest bearing accounts.

NPI Equity,  on behalf of the Partnership and certain  affiliated  partnerships,
has established a revolving credit facility (the  "Partnership  Revolver") to be
used to fund deferred  maintenance  and working capital needs of the Partnership
and certain other  affiliated  partnerships in the National  Property  Investors
Partnership  Series.  The maximum draw  available to the  Partnership  under the
Partnership Revolver is $300,000. Loans under the Partnership Revolver will have
a term of 365 days, be unsecured and bear interest at the prime rate plus 2% per
annum (7.25% at December 31,  2004).  The  maturity  date of any such  borrowing
accelerates  in the event of:  (i) the  removal  of NPI  Equity as the  managing
general partner (whether or not for cause);  (ii) the sale or refinancing of the
property by the  Partnership  (whether or not a borrowing  under the Partnership
Revolver was made with respect to such  property);  or (iii) the  liquidation of
the  Partnership.  During the year ended December 31, 2004, the managing general
partner  agreed to advance funds in excess of the  Partnership  Revolver to fund
redevelopment  work at Village of Pennbrook  Apartments  and advanced  $320,000.
Interest   expense   during  the  year  ended  December  31,  2004  amounted  to
approximately $3,000. The balance payable at December 31, 2004 including accrued
interest is  approximately  $323,000 and is included in due to affiliates in the
Partnership's  balance  sheet.  During the year ended  December  31,  2003,  the
Partnership  did not  have any  borrowings  or  amounts  outstanding  under  the
Partnership Revolver.

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.  For
example,  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.  The Partnership  regularly evaluates the
capital improvement needs of the property. While the Partnership has no material
commitments for property improvements and replacements,  certain routine capital
expenditures are anticipated during 2005. Such capital  expenditures will depend
on the  physical  condition  of the  property as well as  anticipated  cash flow
generated by the property.



<PAGE>


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  $27,855,000 is being amortized over 20 years and
will mature in  September  2021 at which time the  mortgage is  scheduled  to be
fully amortized.

Pursuant to the Partnership Agreement,  the term of the Partnership is scheduled
to expire on December  31,  2005.  The  Managing  General  Partner is  currently
evaluating an extension of the  Partnership's  term and expects to have any such
extension completed by the end of 2005.

The  Partnership  distributed  the  following  amounts  during  the years  ended
December 31, 2004 and 2003 (in thousands, except per unit data):
<TABLE>
<CAPTION>

                                        Per Limited                       Per Limited
                       Year Ended       Partnership       Year Ended      Partnership
                    December 31, 2004      Unit       December 31, 2003       Unit

<S>                      <C>              <C>               <C>              <C>
Operations               $ 1,158          $19.09            $ 510            $ 8.42
</TABLE>

Future cash  distributions  will depend on the levels of net cash generated from
operations,  the  timing  of the  debt  maturity,  sale of the  property  and/or
refinancing.  The Partnership's cash available for distribution is reviewed on a
monthly  basis.  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 2005 or subsequent periods.

Other

In addition to its  indirect  ownership of the general  partner  interest in the
Partnership,  AIMCO and its affiliates  owned 47,442 limited  partnership  units
(the "Units") in the Partnership representing 79.06% of the outstanding Units at
December  31,  2004.  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 AIMCO
Properties,  L.P., the operating  partnership of AIMCO,  either through  private
purchases or tender offers.  Pursuant to the Partnership Agreement,  unitholders
holding a majority of the Units are  entitled  to take action with  respect to a
variety of matters  that  include,  but are not  limited  to,  voting on certain
amendments  to the  Partnership  Agreement  and  voting to remove  the  Managing
General  Partner.  As a result of its  ownership  of  79.06% 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,  AIMCO IPLP, L.P. 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 AIMCO IPLP,  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.


<PAGE>



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, but are not limited
to,  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.
The Partnership will offer rental concessions during particularly slow months or
in response  to heavy  competition  from other  similar  complexes  in the area.
Rental income attributable to leases, net of any concessions, is recognized on a
straight-line  basis over the term of the lease.  The Partnership  evaluates all
accounts  receivable  from  residents and  establishes  an allowance,  after the
application of security deposits,  for accounts greater than 30 days past due on
current tenants and all receivables due from former tenants.


<PAGE>


Item 7.     Financial Statements

NATIONAL PROPERTY INVESTORS 4

                          LIST OF FINANCIAL STATEMENTS

      Report of Independent Registered Public Accounting Firm

      Balance Sheet - December 31, 2004

      Statements of Operations - Years ended December 31, 2004 and 2003

      Statements  of Changes in Partners'  Deficit - Years ended  December 31,
      2004 and 2003

      Statements of Cash Flows - Years ended December 31, 2004 and 2003

      Notes to Financial Statements


<PAGE>


           Report of Independent Registered Public Accounting Firm



The Partners
National Property Investors 4


We have audited the accompanying  balance sheet of National Property Investors 4
as of December 31, 2004, 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, 2004.  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 the standards of the Public  Company
Accounting Oversight Board (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 consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Partnership's internal control
over financial reporting. Accordingly, we express no such opinion. An audit also
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements,  assessing the  accounting  principles
used and  significant  estimates  made by the  management,  and  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, 2004,  and the results of its  operations and its cash flows for
each of the two years in the period ended December 31, 2004, in conformity  with
accounting principles generally accepted in the United States.


                                                          /s/ERNST & YOUNG LLP



Greenville, South Carolina
March 10, 2005



<PAGE>






                          NATIONAL PROPERTY INVESTORS 4

                                  BALANCE SHEET
                        (in thousands, except unit data)

                                December 31, 2004

<TABLE>
<CAPTION>


Assets:
<S>                                                                          <C>
   Cash and cash equivalents                                                 $ 134
   Receivables and deposits                                                       64
   Other assets                                                                1,127
   Investment property (Notes C and D):
      Land                                                    $ 1,980
      Buildings and related personal property                   28,774
                                                                30,754
      Less accumulated depreciation                            (25,412)        5,342

                                                                            $ 6,667
Liabilities and Partners' Deficit

Liabilities:
   Accounts payable                                                          $ 282
   Tenant security deposit liabilities                                           395
   Other liabilities                                                             392
   Due to affiliates (Note B)                                                    345
   Mortgage note payable (Note C)                                             27,855

Partners' Deficit:
   General partner                                             $ (371)
   Limited partners (60,005 units issued and
      outstanding)                                             (22,231)      (22,602)

                                                                            $ 6,667

                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,
                                                                2004          2003
Revenues:
<S>                                                           <C>            <C>
  Rental income                                               $ 7,352        $ 7,086
  Other income                                                    572            371
      Total revenues                                            7,924          7,457

Expenses:
  Operating                                                     2,703          2,323
  General and administrative                                      265            241
  Depreciation                                                    576          1,215
  Interest                                                      2,026          2,081
  Property taxes                                                  612            587
      Total expenses                                            6,182          6,447

Net income (Note E)                                           $ 1,742        $ 1,010

Net income allocated to general partner (1%)                    $ 17          $ 10
Net income allocated to limited partners (99%)                  1,725          1,000

                                                              $ 1,742        $ 1,010

Net income per limited partnership unit                       $ 28.75        $ 16.67

Distributions per limited partnership unit                    $ 19.09        $ 8.42

                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, 2002                    60,005       $ (381)     $(23,305)   $(23,686)

Distributions to partners                  --           (5)         (505)       (510)

Net income for the year ended
  December 31, 2003                        --            10        1,000       1,010

Partners' deficit at
  December 31, 2003                    60,005          (376)     (22,810)    (23,186)

Distributions to partners                  --           (12)      (1,146)     (1,158)

Net income for the year ended
  December 31, 2004                        --            17        1,725       1,742

Partners' deficit at
  December 31, 2004                    60,005       $ (371)     $(22,231)   $(22,602)

                See Accompanying Notes to Financial Statements
</TABLE>



<PAGE>


                          NATIONAL PROPERTY INVESTORS 4

                            STATEMENTS OF CASH FLOWS
                                 (in thousands)

<TABLE>
<CAPTION>

                                                               Years Ended December 31,
                                                                   2004         2003
Cash flows from operating activities:
<S>                                                              <C>          <C>
  Net income                                                     $ 1,742      $ 1,010
  Adjustments to reconcile net income to net cash provided
   by operating activities:
     Depreciation                                                    576        1,215
     Amortization of loan costs                                       43           43
     Bad debt                                                         78           37
     Change in accounts:
      Receivables and deposits                                       (77)         (27)
      Other assets                                                  (111)          (8)
      Accounts payable                                               (18)          31
      Tenant security deposit liabilities                             (4)          32
      Due to affiliate                                                 3           --
      Other liabilities                                              (66)         (54)
        Net cash provided by operating activities                  2,166        2,279

Cash used in investing activities:
  Property improvements and replacements                          (1,108)        (567)

Cash flows from financing activities:
  Distributions to partners                                       (1,158)        (510)
  Advance from affiliate                                             320           --
  Payments on mortgage note payable                                 (846)        (724)
        Net cash used in financing activities                     (1,684)      (1,234)

Net (decrease) increase in cash and cash equivalents                (626)         478
Cash and cash equivalents at beginning of year                       760          282
Cash and cash equivalents at end of year                          $   134      $ 760

Supplemental disclosure of cash flow information:
  Cash paid for interest                                         $ 1,985      $ 1,870

Supplemental disclosure of non-cash information:
  Property improvements and replacements included in
   accounts payable                                               $ 269      $    --

                See Accompanying Notes to Financial Statements
</TABLE>
<PAGE>

                          NATIONAL PROPERTY INVESTORS 4

                          NOTES TO FINANCIAL STATEMENTS

                                December 31, 2004


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. The
Managing   General   Partner  is  currently   evaluating  an  extension  of  the
Partnership's  term and expects to have any such extension  completed by the end
of 2005.

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.  The  Partnership
capitalizes  all  expenditures  in  excess of $250  that  clearly  relate to the
acquisition and  installation of real and personal  property  components.  These
expenditures  include costs incurred to replace  existing  property  components,
costs  incurred  to add a material  new  feature to a  property,  and costs that
increase  the useful life or service  potential of a property  component.  These
capitalized   costs  are  depreciated   over  the  useful  life  of  the  asset.
Expenditures for ordinary repairs,  maintenance and apartment turnover costs are
expensed as  incurred.  In  accordance  with SFAS No. 144,  "Accounting  for the
Impairment of Disposal or 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.  No adjustments for impairment of value were recorded in the years
ended December 31, 2004 or 2003.

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 for real property over 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 27.5 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  $121,000 at  December  31, 2004 that are
maintained by an affiliated  management company on behalf of affiliated entities
in cash concentration accounts.

Deferred Costs

Loan  costs of  approximately  $858,000  are  included  in other  assets  in the
accompanying  balance sheet and are amortized  over the term of the related loan
agreement.  At December  31, 2004,  accumulated  amortization  is  approximately
$139,000.   Amortization  of  loan  costs  is  included  in  interest   expense.
Amortization  expense is  expected to be  approximately  $43,000 for each of the
years 2005 through 2009.

Leasing   commissions  and  other  direct  costs  incurred  in  connection  with
successful  leasing  efforts are  deferred and  amortized  over the terms of the
related leases. Amortization of these costs is included in operating expenses.

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 Instruments

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) approximates their fair value
due to the short term maturity of these instruments.  The Partnership  estimates
the fair value of its long-term  debt by  discounting  future cash flows using a
discount rate commensurate  with that currently  believed to be available to the
Partnership  for similar  term,  fully  amortizing  debt.  The fair value of the
Partnership's  long term debt at the  Partnership's  incremental  borrowing rate
approximates its carrying balance.

Leases

The Partnership generally leases apartment units for twelve-month terms or less.
The Partnership will offer rental concessions during particularly slow months or
in response  to heavy  competition  from other  similar  complexes  in the area.
Rental income attributable to leases, net of any concessions, is recognized on a
straight-line  basis over the term of the lease.  The Partnership  evaluates all
accounts  receivable  from  residents and  establishes  an allowance,  after the
application of security deposits,  for accounts greater than 30 days past due on
current tenants and all receivables due from former tenants.

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  $50,000 and $48,000  during the years ended December 31, 2004
and 2003, 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.

Note B - Transactions with Affiliated Parties

The Partnership has no employees and depends 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 receive 5% of gross receipts from the
Partnership's   property  as  compensation  for  providing  property  management
services.  The Partnership  paid to such affiliates  approximately  $390,000 and
$370,000 for the years ended December 31, 2004 and 2003, respectively,  which is
included in operating expenses.  At December 31, 2004,  approximately $4,000 was
owed for property management services and is included in due to affiliates.

Affiliates of the Managing General Partner charged the Partnership reimbursement
of accountable  administrative  expenses amounting to approximately $162,000 and
$180,000 for the years ended December 31, 2004 and 2003, respectively,  which is
included in general and  administrative  expenses and investment  property.  The
portion of these  reimbursements  included in investment  property for the years
ended  December  31, 2004 and 2003 are fees related to  construction  management
services   provided  by  an  affiliate  of  the  Managing   General  Partner  of
approximately  $26,000 and $20,000,  respectively.  The  construction  agreement
service fees are  calculated  based on a percentage of current  additions to the
Partnership's  investment property. At December 31, 2004,  approximately $18,000
was owed for  accountable  administrative  expenses  and is  included  in due to
affiliates.

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  $78,000 and $34,000 for the
years  ended  December  31,  2004 and 2003,  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, 2004 and 2003, approximately $25,000 and $11,000, respectively, was
paid in conjunction with the operating distributions. These fees are included in
general and administrative expenses.

NPI Equity,  on behalf of the Partnership and certain  affiliated  partnerships,
has established a revolving credit facility (the  "Partnership  Revolver") to be
used to fund deferred  maintenance  and working capital needs of the Partnership
and certain other  affiliated  partnerships in the National  Property  Investors
Partnership  Series.  The maximum draw  available to the  Partnership  under the
Partnership Revolver is $300,000. Loans under the Partnership Revolver will have
a term of 365 days, be unsecured and bear interest at the prime rate plus 2% per
annum (7.25% at December 31,  2004).  The  maturity  date of any such  borrowing
accelerates  in the event of:  (i) the  removal  of NPI  Equity as the  managing
general partner (whether or not for cause);  (ii) the sale or refinancing of the
property by the  Partnership  (whether or not a borrowing  under the Partnership
Revolver was made with respect to such  property);  or (iii) the  liquidation of
the  Partnership.  During the year ended December 31, 2004, the managing general
partner  agreed to advance funds in excess of the  Partnership  Revolver to fund
redevelopment  work at Village of Pennbrook  Apartments  and advanced  $320,000.
Interest   expense   during  the  year  ended  December  31,  2004  amounted  to
approximately $3,000. The balance payable at December 31, 2004 including accrued
interest is  approximately  $323,000 and is included in due to affiliates in the
Partnership's  balance  sheet.  During the year ended  December  31,  2003,  the
Partnership  did not  have any  borrowings  or  amounts  outstanding  under  the
Partnership Revolver.

The  Partnership  insures 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
Managing General  Partner.  During both of the years ended December 31, 2004 and
2003,  the  Partnership  was charged by AIMCO and its  affiliates  approximately
$78,000  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 47,442 limited  partnership  units
(the "Units") in the Partnership representing 79.06% of the outstanding Units at
December  31,  2004.  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 AIMCO
Properties,  L.P., the operating  partnership of AIMCO,  either through  private
purchases or tender offers.

Pursuant to the  Partnership  Agreement,  unitholders  holding a majority of the
Units are  entitled  to take action  with  respect to a variety of matters  that
include, but are not limited to, voting on certain amendments to the Partnership
Agreement and voting to remove the Managing General Partner.  As a result of its
ownership  of  79.06%  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, AIMCO IPLP, L.P., 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 AIMCO IPLP,  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                    2004         Only        Rate      Date       Maturity
                             (in thousands)                            (in thousands)
Village of Pennbrook
<S>                        <C>           <C>        <C>      <C>   <C>      <C>
  Apartments               $27,855       $ 236      7.01%    09/01/21       $ --
</TABLE>

The mortgage note payable is a fixed rate mortgage that is  non-recourse  and is
secured  by a pledge of the  Partnership's  rental  property  and by a pledge of
revenues from the respective rental property.  The mortgage note payable include
a prepayment penalty if repaid prior to maturity.  Further, the property may not
be sold subject to existing indebtedness.

Scheduled  principal payments subsequent to December 31, 2004 are as follows (in
thousands):

                                   2005        $   907
                                   2006            972
                                   2007          1,043
                                   2008          1,118
                                   2009          1,199
                                Thereafter      22,616
                                               $27,855

Note D - Investment Property and Accumulated Depreciation


                                                        Initial Cost
                                                       To Partnership
                                                       (in thousands)
<TABLE>
<CAPTION>

                                                              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         $27,855     $ 1,972     $18,245        $10,537
</TABLE>


                          Gross Amount At Which Carried
                              At December 31, 2004
                                 (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    $28,774   $30,754     $(25,412)    12/81    5-27.5 yrs
</TABLE>

Reconciliation of "Investment Property and Accumulated Depreciation":

                                                    December 31,
                                                 2004          2003
                                                   (in thousands)
Investment Property
Balance at beginning of year                    $29,377       $28,810
  Property improvements                           1,377           567
Balance at end of year                          $30,754       $29,377

Accumulated Depreciation
Balance at beginning of year                    $24,836       $23,621
  Additions charged to expense                      576         1,215
Balance at end of year                          $25,412       $24,836

The aggregate cost of the investment property for Federal income tax purposes at
December  31,  2004  and  2003,  is  approximately  $8,060,000  and  $6,947,000,
respectively. The accumulated depreciation taken for Federal income tax purposes
at December  31, 2004 and 2003,  is  approximately  $3,025,000  and  $2,396,000,
respectively.


<PAGE>


Note E - Income Taxes

The Partnership has received a ruling from the Internal  Revenue Service that it
will  be  classified  as  a  partnership   for  Federal   income  tax  purposes.
Accordingly,  no provision for income taxes is made in the financial  statements
of the Partnership. Taxable income or loss of the Partnership is reported in the
income tax returns of its partners.

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

                                                December 31,
                                              2004         2003

Net income as reported                      $ 1,742      $ 1,010
Add (deduct):
  Depreciation differences                      (53)         680
  Prepaid rent                                  (51)          34
  Other                                        (114)        (195)

Federal taxable income                      $ 1,524      $ 1,529

Federal taxable income per limited
  partnership unit                          $ 25.14      $ 25.23

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

                                                       2004

         Net liabilities as reported                $ (22,602)
         Land and buildings                           (22,694)
         Accumulated depreciation                      22,387
         Syndication and distribution costs             3,375
         Other                                            457

         Net liabilities - Federal tax basis         $(19,077)

Note F - Contingencies

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
purported  to  assert  claims  on  behalf  of a class of  limited  partners  and
derivatively  on behalf  of a number  of  limited  partnerships  (including  the
Partnership)  that 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 that 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  sought  monetary
damages and equitable relief, including judicial dissolution of the Partnership.
In addition,  during the third quarter of 2001, a complaint  captioned Heller v.
Insignia  Financial  Group (the  "Heller  action")  was filed  against  the same
defendants  that are named in the  Nuanes  action.  On or about  August 6, 2001,
plaintiffs filed a first amended  complaint.  The Heller action was brought as a
purported derivative action, and asserted claims for, among other things, breach
of fiduciary  duty,  unfair  competition,  conversion,  unjust  enrichment,  and
judicial dissolution.

On January 8, 2003,  the parties filed a  Stipulation  of Settlement in proposed
settlement of the Nuanes action and the Heller action.

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
at least one round of tender offers 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 provided 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.  On April  11,  2003,  notice  was
distributed  to  limited   partners   providing  the  details  of  the  proposed
settlement.

On June 13, 2003, the court granted final approval of the settlement and entered
judgment in both the Nuanes and Heller actions.  On August 12, 2003, an objector
("Objector") filed an appeal (the "Appeal") seeking to vacate and/or reverse the
order approving the settlement and entering  judgment  thereto.  On November 24,
2003,  the Objector  filed an  application  requesting  the court order AIMCO to
withdraw settlement tender offers it had commenced,  refrain from making further
offers  pending  the appeal and auction  any units  tendered  to third  parties,
contending  that the offers did not  conform  with the terms of the  settlement.
Counsel  for the  Objector  (on behalf of another  investor)  had  alternatively
requested the court take certain action  purportedly to enforce the terms of the
settlement agreement. On December 18, 2003, the court heard oral argument on the
motions  and denied them both in their  entirety.  The  Objector  filed a second
appeal challenging the court's use of a referee and its order requiring Objector
to pay those fees.

On January 28, 2004,  the  Objector  filed his opening  brief in the Appeal.  On
April 23, 2004, the Managing General Partner and its affiliates filed a response
brief in support of the settlement and the judgment thereto. The plaintiffs have
also filed a brief in support of the settlement. On June 4, 2004, Objector filed
a reply to the briefs  submitted by the Managing General Partner and Plaintiffs.
In addition both the Objector and plaintiffs filed briefs in connection with the
second  appeal.  The Court of Appeals  heard oral  argument  on both  appeals on
September 22, 2004 and took the matters under submission.

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.

As previously  disclosed both AIMCO Properties L.P. and NHP Management  Company,
both affiliates of the Managing General Partner,  are defendants in an action in
the United States  District  Court,  District of Columbia.  The plaintiffs  have
styled their complaint as a collective action under the Fair Labor Standards Act
("FLSA") and seek to certify state subclasses in California,  Maryland,  and the
District of Columbia. Specifically, the plaintiffs contend that AIMCO Properties
L.P. failed to compensate  maintenance  workers for time that they were required
to be "on-call". Additionally, plaintiffs allege AIMCO Properties L.P. failed to
comply  with the FLSA in  compensating  maintenance  workers  for time that they
worked in responding to a call while  "on-call".  The  defendants  have filed an
answer to the amended complaint denying the substantive  allegations.  Discovery
relating  to the  certification  of the  collective  action  has  concluded  and
briefing on the matter is underway.  Although the outcome of any  litigation  is
uncertain,  AIMCO  Properties,  L.P. does not believe that the ultimate  outcome
will have a material  adverse  effect on its  financial  condition or results of
operations.  Similarly,  the Managing  General Partner does not believe that the
ultimate  outcome  will have a  material  adverse  effect  on the  Partnership's
financial condition or results of operations.

The  Partnership  is unaware  of any other  pending  or  outstanding  litigation
matters involving it or its investment property that are not of a routine nature
arising in the ordinary course of business.

Environmental

Various  Federal,  state and local laws subject  property owners or operators to
liability for management,  and the costs of removal or  remediation,  of certain
hazardous  substances  present on a property.  Such laws often impose  liability
without regard to whether the owner or operator knew of, or was responsible for,
the release or presence of the  hazardous  substances.  The  presence of, or the
failure to manage or remedy properly,  hazardous substances may adversely affect
occupancy at affected  apartment  communities and the ability to sell or finance
affected properties.  In addition to the costs associated with investigation and
remediation  actions brought by government  agencies,  the presence of hazardous
substances  on a  property  could  result in claims by  private  plaintiffs  for
personal injury,  disease,  disability or other  infirmities.  Various laws also
impose  liability for the cost of removal,  remediation or disposal of hazardous
substances  through a  licensed  disposal  or  treatment  facility.  Anyone  who
arranges for the disposal or treatment of hazardous  substances  is  potentially
liable  under such laws.  These laws often impose  liability  whether or not the
person arranging for the disposal ever owned or operated the disposal  facility.
In connection with the ownership and operation of its property,  the Partnership
could  potentially be liable for  environmental  liabilities or costs associated
with its property.

Mold

The Partnership is aware of lawsuits  against owners and managers of multifamily
properties asserting claims of personal injury and property damage caused by the
presence of mold, some of which have resulted in substantial  monetary judgments
or settlements. The Partnership has only limited insurance coverage for property
damage loss claims  arising from the  presence of mold and for  personal  injury
claims related to mold exposure. Affiliates of the Managing General Partner have
implemented a national  policy and  procedures to prevent or eliminate mold from
its properties  and the Managing  General  Partner  believes that these measures
will  eliminate,  or at least  minimize,  the  effects  that mold  could have on
residents.  To date,  the  Partnership  has not incurred  any material  costs or
liabilities  relating to claims of mold  exposure  or to abate mold  conditions.
Because the law  regarding  mold is unsettled and subject to change the Managing
General  Partner  can make no  assurance  that  liabilities  resulting  from the
presence of or exposure to mold will not have a material  adverse  effect on the
Partnership's financial condition or results of operations.

As  previously  disclosed,  the  Central  Regional  Office of the United  States
Securities  and  Exchange   Commission   (the  "SEC")  is  conducting  a  formal
investigation relating to certain matters.  Although the staff of the SEC is not
limited  in the  areas  that it may  investigate,  AIMCO  believes  the areas of
investigation include AIMCO's miscalculated monthly net rental income figures in
third quarter 2003,  forecasted  guidance,  accounts payable,  rent concessions,
vendor  rebates,  capitalization  of payroll and certain  other  costs,  and tax
credit  transactions.  AIMCO is cooperating  fully. AIMCO is not able to predict
when the matter  will be  resolved.  AIMCO does not  believe  that the  ultimate
outcome  will  have a  material  adverse  effect on its  consolidated  financial
condition or results of operations. Similarly, the Managing General Partner does
not believe that the ultimate outcome will have a material adverse effect on the
Partnership's financial condition or results of operations.



<PAGE>




Item 8.     Changes in and  Disagreements  with  Accountants on Accounting and
            Financial Disclosures

            None.

Item 8a.    Controls and Procedures

(a) Disclosure Controls and Procedures.  The Partnership's management,  with the
participation of 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,  has
evaluated  the  effectiveness  of  the  Partnership's  disclosure  controls  and
procedures (as such term is defined in Rules  13a-15(e) and 15d-15(e)  under the
Securities  Exchange Act of 1934, as amended (the "Exchange Act")) as of the end
of the period covered by this report.  Based on such  evaluation,  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 concluded that, as of the
end of such period,  the  Partnership's  disclosure  controls and procedures are
effective.

(b) Internal Control Over Financial  Reporting.  There have not been any changes
in the Partnership's  internal control over financial reporting (as such term is
defined in Rules  13a-15(f)  and  15d-15(f)  under the Exchange  Act) during the
fourth quarter of 2004 that have materially  affected,  or are reasonably likely
to  materially  affect,  the  Partnership's   internal  control  over  financial
reporting.

Item 8b.    Other Information

            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 names of the directors and 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

Martha L. Long               45    Director and Senior Vice President
Harry G. Alcock              42    Director and Executive Vice President
Miles Cortez                 61    Executive Vice President, General Counsel
                                     and Secretary
Patti K. Fielding            41    Executive Vice President
Paul J. McAuliffe            48    Executive Vice President and Chief
                                     Financial Officer
Thomas M. Herzog             42    Senior Vice President and Chief Accounting
                                     Officer
Stephen B. Waters            43    Vice President

Martha L. Long has been a Director  and Senior Vice  President of the Managing
General  Partner  since  February  2004.  Ms.  Long has been with AIMCO  since
October  1998 and has served in  various  capacities.  From 1998 to 2001,  Ms.
Long served as Senior Vice  President and Controller of AIMCO and the Managing
General  Partner.  During  2002 and 2003,  Ms.  Long  served  as  Senior  Vice
President of Continuous Improvement for AIMCO.

Harry G. Alcock was appointed as a Director of the Managing  General  Partner in
October 2004 and was appointed  Executive Vice President of the Managing General
Partner  in  February  2004 and has been  Executive  Vice  President  and  Chief
Investment Officer of AIMCO since October 1999. Prior to October 1999 Mr. Alcock
served as a Vice President of AIMCO from July 1996 to October 1997,  when he was
promoted to Senior Vice  President  Acquisitions  where he served until  October
1999. Mr. Alcock has had responsibility for acquisition and financing activities
of AIMCO since July 1994.

Miles  Cortez was  appointed  Executive  Vice  President,  General  Counsel  and
Secretary  of the  Managing  General  Partner in  February  2004 and of AIMCO in
August 2001. Prior to joining AIMCO, Mr. Cortez was the senior partner of Cortez
Macaulay Bernhardt & Schuetze LLC, a Denver law firm, from December 1997 through
September 2001.

Patti K. Fielding was appointed  Executive  Vice President - Securities and Debt
of the Managing  General Partner in February 2004 and of AIMCO in February 2003.
Ms.  Fielding was appointed  Treasurer of AIMCO in January 2005. Ms. Fielding is
responsible  for  debt  financing  and the  treasury  department.  Ms.  Fielding
previously  served as Senior Vice  President - Securities and Debt of AIMCO from
January 2000 to February 2003. Ms.  Fielding  joined AIMCO in February 1997 as a
Vice President.

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

Thomas M.  Herzog was  appointed  Senior  Vice  President  and Chief  Accounting
Officer of the Managing General Partner in February 2004 and of AIMCO in January
2004.  Prior to joining AIMCO in January 2004, Mr. Herzog was at GE Real Estate,
serving  as Chief  Accounting  Officer & Global  Controller  from  April 2002 to
January 2004 and as Chief Technical Advisor from March 2000 to April 2002. Prior
to joining GE Real  Estate,  Mr.  Herzog was at  Deloitte & Touche LLP from 1990
until 2000.

Stephen B. Waters was appointed Vice President of the Managing  General  Partner
in April  2004.  Mr.  Waters  previously  served as a  Director  of Real  Estate
Accounting   since   joining   AIMCO  in   September   1999.   Mr.   Waters  has
responsibilities for real estate and partnership accounting with AIMCO.

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 board of directors of the Managing  General Partner does not have a separate
audit committee. As such, the board of directors of the Managing General Partner
fulfills  the  functions  of an audit  committee.  The  board of  directors  has
determined  that  Martha L. Long meets the  requirement  of an "audit  committee
financial expert".

The directors and officers of the Managing  General  Partner with authority over
the Partnership are all employees of subsidiaries of AIMCO.  AIMCO has adopted a
code of ethics that applies to such  directors  and  officers  that is posted on
AIMCO's  website  (www.AIMCO.com).   AIMCO's  website  is  not  incorporated  by
reference to this filing.

Item 10.    Executive Compensation

Neither the directors nor the officers of the Managing  General Partner received
any  remuneration  from the Registrant  during the years ended December 31, 2004
and 2003.



<PAGE>



Item 11.    Security Ownership of Certain Beneficial Owners and Management

Except as noted below, as of December 31, 2004, 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
AIMCO IPLP, 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.                        10,465           17.44%
  (an affiliate of AIMCO)

AIMCO IPLP, L.P. and IPLP  Acquisition I, LLC are indirectly  ultimately owned
by AIMCO.  Their business address is 55 Beattie Place,  Greenville,  SC 29602.
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 depends 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 receive 5% of gross receipts from the
Partnership's   property  as  compensation  for  providing  property  management
services.  The Partnership  paid to such affiliates  approximately  $390,000 and
$370,000 for the years ended December 31, 2004 and 2003, respectively,  which is
included in operating expenses.  At December 31, 2004,  approximately $4,000 was
owed for property management services and is included in due to affiliates.

Affiliates of the Managing General Partner charged the Partnership reimbursement
of accountable  administrative  expenses amounting to approximately $162,000 and
$180,000 for the years ended December 31, 2004 and 2003, respectively,  which is
included in general and  administrative  expenses and investment  property.  The
portion of these  reimbursements  included in investment  property for the years
ended  December  31, 2004 and 2003 are fees related to  construction  management
services   provided  by  an  affiliate  of  the  Managing   General  Partner  of
approximately  $26,000 and $20,000,  respectively.  The construction  management
service fees are  calculated  based on a percentage of current  additions to the
Partnership's  investment property. At December 31, 2004,  approximately $18,000
was owed for  accountable  administrative  expenses  and is  included  in due to
affiliates.

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  $78,000 and $34,000 for the
years  ended  December  31,  2004 and 2003,  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, 2004 and 2003, approximately $25,000 and $11,000, respectively, was
paid in conjunction with the operating distributions. These fees are included in
general and administrative expenses.

NPI Equity,  on behalf of the Partnership and certain  affiliated  partnerships,
has established a revolving credit facility (the  "Partnership  Revolver") to be
used to fund deferred  maintenance  and working capital needs of the Partnership
and certain other  affiliated  partnerships in the National  Property  Investors
Partnership  Series.  The maximum draw  available to the  Partnership  under the
Partnership Revolver is $300,000. Loans under the Partnership Revolver will have
a term of 365 days, be unsecured and bear interest at the prime rate plus 2% per
annum (7.25% at December 31,  2004).  The  maturity  date of any such  borrowing
accelerates  in the event of:  (i) the  removal  of NPI  Equity as the  managing
general partner (whether or not for cause);  (ii) the sale or refinancing of the
property by the  Partnership  (whether or not a borrowing  under the Partnership
Revolver was made with respect to such  property);  or (iii) the  liquidation of
the  Partnership.  During the year ended December 31, 2004, the managing general
partner  agreed to advance funds in excess of the  Partnership  Revolver to fund
redevelopment  work at Village of Pennbrook  Apartments  and advanced  $320,000.
Interest   expense   during  the  year  ended  December  31,  2004  amounted  to
approximately $3,000. The balance payable at December 31, 2004 including accrued
interest is  approximately  $323,000 and is included in due to affiliates in the
Partnership's  balance  sheet.  During the year ended  December  31,  2003,  the
Partnership  did not  have any  borrowings  or  amounts  outstanding  under  the
Partnership Revolver.

The  Partnership  insures 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
Managing General  Partner.  During both of the years ended December 31, 2004 and
2003,  the  Partnership  was charged by AIMCO and its  affiliates  approximately
$78,000  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 47,442 limited  partnership  units
(the "Units") in the Partnership representing 79.06% of the outstanding Units at
December  31,  2004.  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 AIMCO
Properties,  L.P., the operating  partnership of AIMCO,  either through  private
purchases or tender offers.  Pursuant to the Partnership Agreement,  unitholders
holding a majority of the Units are  entitled  to take action with  respect to a
variety of matters  that  include,  but are not  limited  to,  voting on certain
amendments  to the  Partnership  Agreement  and  voting to remove  the  Managing
General  Partner.  As a result of its  ownership  of  79.06% 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,  AIMCO IPLP, L.P., 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 AIMCO IPLP,  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

            See Exhibit Index.

Item 14.    Principal Accountant Fees and Services

The Managing  General Partner has  reappointed  Ernst & Young LLP as independent
auditors to audit the financial  statements  of the  Partnership  for 2005.  The
aggregate  fees billed for  services  rendered by Ernst & Young LLP for 2004 and
2003 are described below.

Audit Fees. Fees for audit services  totaled  approximately  $28,000 and $32,000
for 2004 and 2003,  respectively.  Fees for audit services also include fees for
the reviews of the Partnership's Quarterly Reports on Form 10-QSB.

Tax Fees. Fees for tax services totaled  approximately  $6,000 for both 2004 and
2003, respectively.


<PAGE>



                                   SIGNATURES


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


                                    NATIONAL PROPERTY INVESTORS 4


                                    By:   NPI EQUITY INVESTMENTS, INC.
                                          Managing General Partner


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


                                          /s/Stephen B. Waters
                                    By:   Stephen B. Waters
                                          Vice President

                                    Date: March 18, 2005


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


/s/Harry G. Alcock            Director and Executive        Date: March 18, 2005
Harry G. Alcock               Vice President


/s/Martha L. Long             Director and Senior Vice      Date: March 18, 2005
Martha L. Long                President


/s/Stephen B. Waters          Vice President                Date: March 18, 2005
Stephen B. Waters


<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.

 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.

10.7              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.

31.1              Certification  of  equivalent  of  Chief  Executive  Officer
                  pursuant     to     Securities     Exchange     Act    Rules
                  13a-14(a)/15d-14(a),  as Adopted  Pursuant to Section 302 of
                  the Sarbanes-Oxley Act of 2002.

31.2              Certification  of  equivalent  of  Chief  Financial  Officer
                  pursuant     to     Securities     Exchange     Act    Rules
                  13a-14(a)/15d-14(a),  as Adopted  Pursuant to Section 302 of
                  the Sarbanes-Oxley Act of 2002.

32.1              Certification   Pursuant  to  18  U.S.C.  Section  1350,  as
                  Adopted  Pursuant to Section 906 of the  Sarbanes-Oxley  Act
                  of 2002.



<PAGE>




Exhibit 31.1


                                  CERTIFICATION


I, Martha L. Long, certify that:


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

2.    Based on my knowledge,  this 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
      report;

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

4.    The  small  business  issuer's  other  certifying  officer(s)  and  I  are
      responsible  for  establishing  and  maintaining  disclosure  controls and
      procedures (as defined in Exchange Act Rules  13a-15(e) and 15d-15(e)) for
      the small business issuer and have:

      (a)   Designed such  disclosure  controls and  procedures,  or caused such
            disclosure   controls  and  procedures  to  be  designed  under  our
            supervision,  to ensure that  material  information  relating to the
            small business issuer, including its consolidated  subsidiaries,  is
            made  known to us by  others  within  those  entities,  particularly
            during the period in which this report is being prepared;

      (b)   Evaluated  the   effectiveness   of  the  small  business   issuer's
            disclosure  controls and procedures and presented in this report our
            conclusions about the  effectiveness of the disclosure  controls and
            procedures, as of the end of the period covered by this report based
            on such evaluation; and

      (c)   Disclosed in this report any change in the small  business  issuer's
            internal  control over financial  reporting that occurred during the
            small  business  issuer's  most  recent  fiscal  quarter  (the small
            business  issuer's  fourth  fiscal  quarter in the case of an annual
            report) that has  materially  affected,  or is reasonably  likely to
            materially affect, the small business issuer's internal control over
            financial reporting; and

5.    The  small  business  issuer's  other  certifying  officer(s)  and I  have
      disclosed,  based on our most recent  evaluation of internal  control over
      financial reporting, to the small business issuer's auditors and the audit
      committee of the small  business  issuer's  board of directors (or persons
      performing the equivalent functions):

      (a)   All significant  deficiencies and material  weaknesses in the design
            or operation of internal control over financial  reporting which are
            reasonably  likely to adversely  affect the small business  issuer's
            ability  to  record,   process,   summarize  and  report   financial
            information; and

      (b)   Any fraud,  whether or not  material,  that  involves  management or
            other  employees who have a significant  role in the small  business
            issuer's internal control over financial reporting.

Date:  March 18, 2005

                                    /s/Martha L. Long
                                    Martha L. Long
                                    Senior  Vice   President   of  NPI  Equity
                                    Investments,   Inc.,   equivalent  of  the
                                    chief executive officer of the Partnership


<PAGE>



Exhibit 31.2


                                  CERTIFICATION


I, Stephen B. Waters, certify that:


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

2.    Based on my knowledge,  this 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
      report;

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

4.    The  small  business  issuer's  other  certifying  officer(s)  and  I  are
      responsible  for  establishing  and  maintaining  disclosure  controls and
      procedures (as defined in Exchange Act Rules  13a-15(e) and 15d-15(e)) for
      the small business issuer and have:

      (a)   Designed such  disclosure  controls and  procedures,  or caused such
            disclosure   controls  and  procedures  to  be  designed  under  our
            supervision,  to ensure that  material  information  relating to the
            small business issuer, including its consolidated  subsidiaries,  is
            made  known to us by  others  within  those  entities,  particularly
            during the period in which this report is being prepared;

      (b)   Evaluated  the   effectiveness   of  the  small  business   issuer's
            disclosure  controls and procedures and presented in this report our
            conclusions about the  effectiveness of the disclosure  controls and
            procedures, as of the end of the period covered by this report based
            on such evaluation; and

      (c)   Disclosed in this report any change in the small  business  issuer's
            internal  control over financial  reporting that occurred during the
            small  business  issuer's  most  recent  fiscal  quarter  (the small
            business  issuer's  fourth  fiscal  quarter in the case of an annual
            report) that has  materially  affected,  or is reasonably  likely to
            materially affect, the small business issuer's internal control over
            financial reporting; and

5.    The  small  business  issuer's  other  certifying  officer(s)  and I  have
      disclosed,  based on our most recent  evaluation of internal  control over
      financial reporting, to the small business issuer's auditors and the audit
      committee of the small  business  issuer's  board of directors (or persons
      performing the equivalent functions):

      (a)   All significant  deficiencies and material  weaknesses in the design
            or operation of internal control over financial  reporting which are
            reasonably  likely to adversely  affect the small business  issuer's
            ability  to  record,   process,   summarize  and  report   financial
            information; and

      (b)   Any fraud,  whether or not  material,  that  involves  management or
            other  employees who have a significant  role in the small  business
            issuer's internal control over financial reporting.

Date:  March 18, 2005

                                    /s/Stephen B. Waters
                                    Stephen B. Waters
                                    Vice President of NPI Equity Investments,
                                    Inc., equivalent of the chief financial
                                    officer of the Partnership

<PAGE>



Exhibit 32.1


                          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, 2004 as filed
with the Securities and Exchange  Commission on the date hereof (the  "Report"),
Martha  L.  Long,  as the  equivalent  of the  Chief  Executive  Officer  of the
Partnership,  and Stephen B. Waters,  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/Martha L. Long
                                    Name:  Martha L. Long
                                    Date:  March 18, 2005


                                           /s/Stephen B. Waters
                                    Name:  Stephen B. Waters
                                    Date:  March 18, 2005


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