U.S. SECURITIES AND EXCHANGE COMMISSION

                              Washington, DC 20549
                           -------------------------
                                   FORM 10-QSB

(Mark One)

/X/       QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
          ACT OF 1934

For the quarterly period ended September 30, 1996
                               ------------------

/ /       TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from          to
                               _________    ____________

Commission file number 0-5097
                       ------

                           UNITED VANGUARD HOMES, INC.
--------------------------------------------------------------------------------
        (Exact Name of Small Business Issuer as Specified in Its Charter)


             Delaware                                    11-2032899
---------------------------------           ------------------------------------
(State or Other Jurisdiction of              (IRS Employer Identification
 Incorporation or Organization)                            Number)


                  4 Cedar Swamp Road, Glen Cove, New York 11542
--------------------------------------------------------------------------------
                    (Address of Principal Executive Offices)


                                 (516) 759-1188
--------------------------------------------------------------------------------
                (Issuer's Telephone Number, Including Area Code)

                                       N/A
--------------------------------------------------------------------------------
              (Former Name, Former Address and Former Fiscal Year,
                          if Changed Since Last Report)

         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 / /        No     /X/

         State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date: At September 30, 1996,
there were outstanding 2,240,950 shares of the Registrant's Common Stock, $.01
par value.

         Transitional Small Business Disclosure Format:

                                   Yes  / /      No  /X/

<PAGE>
                                   FORM 10-QSB

                                      INDEX

PART I.   FINANCIAL INFORMATION:                                     Page No.

          Consolidated Balance Sheets (Unaudited) -
           Sept. 30 and March 31, 1996....................................4

          Consolidated Statement of Earnings (Unaudited)
            Three and Six Months Ended Sept. 30, 1996 and 1995 ...........5

          Consolidated Statement of Stockholders' Deficiency (Unaudited)
            Six Months Ended Sept. 30, 1996...............................6

          Unaudited Consolidated Statement of Cash Flows
            For the Six Months Ended Sept. 30, 1996 and 1995..............7

          Notes to Unaudited Consolidated Financial Statements............8

          Management's Discussion and Analysis
           or Plan of Operation..........................................10

PART II.  OTHER INFORMATION:

          Exhibits and Reports on Form 8-K...............................12

          Signatures.....................................................13

                                        2

<PAGE>
                         PART I - FINANCIAL INFORMATION

ITEM 1 -  FINANCIAL STATEMENTS











                                      -3-
<PAGE>

                  UNITED VANGUARD HOMES, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEET

                                   (UNAUDITED)

                                     ASSETS
<TABLE>
<CAPTION>


                                                                                  September 30,           March 31,
CURRENT ASSETS                                                                        1996                  1996
--------------                                                                        ----                  ----

<S>                                                                               <C>                    <C>
      Cash                                                                          $697,952               $210,245
      Accounts receivable, less allowance for doubtful
        accounts of $40,000 in 1995 and 1996                                         483,933                413,539
      Development fees and advances                                                   77,000                270,864
      Due from affiliates, net                                                       168,892                658,717
      Prepaid expenses and other                                                     702,865                274,654
                                                                                   ---------             ----------
                 Total current assets                                              2,130,642              1,828,019

PROPERTY AND EQUIPMENT - NET                                                       2,339,450              2,361,698

OTHER ASSETS
      Development fees                                                               773,155                575,017
      Restricted assets                                                              176,352                176,352
      Deferred income taxes                                                          974,400                981,000
      Other assets                                                                   572,171                165,453
                                                                                  ----------             ----------
                                                                                   2,496,078              1,897,822
                                                                                  ----------             ----------
                                                                                  $6,966,170             $6,087,539
                                                                                  ==========             ==========

CURRENT LIABILITIES
      Current portion of long-term debt                                           $4,994,569               $626,043
      Accounts payable                                                               228,630                242,470
      Accrued expenses                                                               723,116                617,043
      Income taxes payable                                                           487,281                442,371
                                                                                  ----------             ----------
                 Total Current Liabilities                                         6,433,596              1,927,927

RESIDENT SECURITY DEPOSITS                                                           313,704                314,705

LONG-TERM DEBT, less current portion                                               1,846,437              7,172,982

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' DEFICIENCY
      Preferred stock $.001 par value; 1,000,000
        shares authorized; none issued and outstanding                                    --                     --
      Common stock, $.01 par value;  authorized,
       14,000,000 shares;  issued and outstanding,
       1,827,778 shares and 2,240,950 shares in
      March 31, 1996 and September 30, 1996, respectively                             22,410                 18,278
      Additional paid-in capital                                                   7,216,026              5,619,905
      Accumulated deficit                                                         (8,866,003)            (8,966,258)
                                                                                  ----------             ----------
                                                                                  (1,627,567)            (3,328,075)
                                                                                  ----------             ----------

                                                                                  $6,966,170             $6,087,539
                                                                                  ==========             -=========
</TABLE>

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.

                                                             4
<PAGE>



                  UNITED VANGUARD HOMES, INC. AND SUBSIDIARIES

                       CONSOLIDATED STATEMENT OF EARNINGS

                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                For the three months                For the six months
                                                                 ended September 30,                ended September 30,
                                                                 1996          1995                 1996             1995
                                                                 ----          ----                 ----             ----

<S>                                                            <C>            <C>                 <C>             <C>       
Operating Revenues:
     Resident Services                                         $1,273,472     $1,228,950          $2,521,231      $2,424,003
     Health care services                                         672,805        686,474           1,316,820       1,311,462
     Development fees                                              53,960        420,000             138,960         420,000
                                                               ----------     ----------          ----------      ----------
                                                                2,000,237      2,335,424           3,977,011       4,155,465

Operating Expenses:
     Residence operating expenses                               1,494,188      1,471,940           2,975,415       2,860,741
     General and administrative                                   154,131         94,238             308,143         162,572
     Depreciation and amortiztion                                  68,356         85,396             137,956         218,552
     Provision for loss on (Recovery of)
      advances to affiliates                                      114,350        396,359              42,494         396,359
                                                               ----------     ----------          ----------      ----------
                                                                1,831,025      2,047,933           3,464,008       3,638,224

            Income from operations                                169,212        287,491             513,003         517,241

Other Income (expense)
     Interest expense, net                                       (134,610)      (170,065)           (269,928)       (347,582)
     Other income                                                  95,291         31,124             116,146          44,183
     Debt conversion expense                                           --             --           (156,466)              --

            Income before income taxes                            129,893        148,550             202,755         213,842

Income Taxes                                                       68,242         60,457             102,500          87,057
                                                               ----------     ----------          ----------      ----------

            NET INCOME                                         $   61,651     $   88,093          $  100,255      $  126,785
                                                               ==========     ==========          ==========      ==========

Earnings per share                                                   $.04           $.08                $.06            $.11

Common shares and equivalents outstanding                       1,700,266      1,158,118           1,698,791       1,158,118
</TABLE>


THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THIS STATEMENT.

                                        5

<PAGE>
                  UNITED VANGUARD HOMES, INC. AND SUBSIDIARIES

               CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIENCY

                       SIX MONTHS ENDED SEPTEMBER 30, 1996

                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                  Additional
                                                                    Paid-in          Accumulated
                                         Shares        Amount      Capital             Deficit               Total
                                         ------        ------      -------             -------               -----

<S>                                      <C>            <C>         <C>               <C>               <C>
Balance, April 1, 1996                   1,827,778      $18,278     $5,619,905        $(8,966,258)      $(3,328,075)

Shares issued upon conversion
  of debt                                  347,996        3,480      1,386,918                 --         1,390,398
Exercise of warrants                       621,121          622        206,452                 --           207,074
Shares issued as compensation                3,000           30          2,751                 --             2,781
Net income for the six months
  ended September 30, 1996                      --           --             --            100,255           100,255
                                         ---------      -------      ---------       ------------       -----------

Balance, September 30, 1996              2,240,950      $22,410     $7,216,026        $(8,866,003)      $(1,627,567)
                                         =========      =======      ==========      ============       ===========
</TABLE>





THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THIS STATEMENT.

                                        6

<PAGE>




                  UNITED VANGUARD HOMES, INC. AND SUBSIDIARIES

                 UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>


                                                                   For The Six Months Ended September 30,
                                                                   --------------------------------------

                                                                         1996                  1995
                                                                        ------                -----

<S>                                                                  <C>                  <C>       
Cash flows from operating activities
  Net income                                                         $  100,255           $  126,785
  Adjustments to reconcile net income to net cash
    provided by (used in) operating activities
          Depreciation and amortization                                 137,959              218,552
          Common stock issued for services                                2,781                   --
          Deferred income taxes                                           6,600              120,371
          Debt Conversion expense                                       156,466                   --
          Changes in operating assets and liabilities
            Accounts receivable, advances
              and other receivables                                     593,095              (35,796)
            Prepaid expenses and other                                  (16,744)              65,362
            Development fees                                           (477,822)           1,598,482
            Decrease in due to affiliates                              (100,000)                  --
            Accounts payable                                            (13,937)             (23,670)
            Accrued expenses                                            106,072               63,825
            Income taxes payable                                         44,892               47,687
            Resident security deposits                                   (1,001)               8,633
                                                                     ----------           ------------

          Net cash provided by operating activities                     538,616            2,190,231
                                                                     ----------           ------------

Cash flows used in investing activities
  Purchases of property and equipment                                  (104,799)             (37,367)
                                                                     ----------           ------------

Cash flows from financing activities
  Proceeds from borrowings on mortgages
    and notes payable                                                   547,591                   --
  Principal repayments of mortgages
    and notes payable                                                  (208,892)             (84,312)
  Proceeds from exercise of warrants                                    207,074                   --

  Increase in deferred offering costs                                  (491,883)                  --
                                                                     ----------          ------------

  Net cash used in financing activities                                 (53,890)             (84,312)
                                                                     ----------          ------------

  NET INCREASE IN CASH                                                  487,707            2,068,552

  Cash, beginning of period                                             210,245              249,561
                                                                     ----------           -----------
  Cash, end of period                                                $  697,952           $2,318,113
                                                                     ==========           ===========

  Supplemental disclosures of cash flow information:
    Cash paid during the year for
          Interest                                                   $  265,200           $  334,292
                                                                     ==========           ==========
          Income taxes                                               $   51,000           $    - 0 -
                                                                     ==========           ========--
</TABLE>


                                        7

<PAGE>
                  UNITED VANGUARD HOMES, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE A - BASIS OF PRESENTATION

  The accompanying  consolidated  balance sheet as of September 30, 1996 and the
related  consolidated  statements  of earnings  and cash flows for the six month
periods ended  September  30, 1996 and 1995 and the  statement of  stockholders'
deficiency for the six month period ended  September 30, 1996 have been prepared
by the management of United Vanguard Homes, Inc. (the "Company")  without audit.
In the  opinion of  management,  all  adjustments  (which  include  only  normal
recurring  accrual  adjustments)  necessary  to  present  fairly  the  financial
position and results of operations as of and for the six months ended  September
30, 1996 have been made.

  Certain information and footnote  disclosures,  normally included in financial
statements prepared in accordance with generally accepted accounting principles,
have been condensed or omitted.  These  financial  statements  should be read in
conjunction  with the financial  statements  and notes  thereto  included in the
Company's  Annual  Report on Form 10-K for the year ended  March 31,  1996.  The
results  of  operations  for  the  period  ended  September  30,  1996  are  not
necessarily indicative of the operating results expected for a full year.

NOTE B - STOCKHOLDERS' EQUITY

     CONVERTIBLE DEBT

     In March 1996,  the Company  offered the  convertible  mortgageholders  and
noteholders  the option to convert,  through April 30, 1996, to shares of common
stock at a price of $3.75 instead of prices ranging from $6.67 through $7.22. In
April 1996, 347,996 common shares were issued in connection with the offer. As a
result  of  the  offer,  the  Company  issued  167,877  additional  shares  upon
conversion,  the fair  value of  which,  $156,466,  has  been  recorded  as debt
conversion expense in the accompanying  consolidated statement of operations for
the six months ended September 30, 1996.

     STOCK OPTION PLAN

     In June 1996, the Company adopted the 1996 Outside  Directors' Stock Option
Plan (the "Directors Plan"), which provides for the grant of options to purchase
common  stock of the  Company  to  nonemployee  directors  of the  Company.  The
Directors'  Plan authorizes the issuance of a maximum of 90,000 shares of common
stock.

     The Directors' Plan is  administered  by the Board of Directors.  Under the
Directors'  Plan,  each  nonemployee  director  elected after April 1, 1996 will
receive  options for 3,000 shares of common stock upon  election.  To the extent
that shares of common stock remain  available for the grant of options under the
Directors'  Plan,  each  year  on  April  1,  commencing  April  1,  1997,  each
nonemployee  director  will be granted  an option to  purchase  1,800  shares of
common  stock.  The exercise  price per share for all options  granted under the
Directors' Plan will be equal to the fair market value of the common stock as of
the date  preceding  the date of grant.  All options  vest in three equal annual
installments.

     EMPLOYMENT AGREEMENTS

     As of April 1, 1996, the Company entered into an employment  agreement with
the Company's  President and Chief Operating Officer pursuant to which an annual
base salary under the  employment  agreement is $100,000.  In December 1995, the
President  received a $25,000  cash bonus and the Company  agreed to issue 9,000
shares of the  Company's  common  stock fair valued at $5.55 per share.  In June
1996,  The  President  received  a $25,000  cash  bonus and 3,000  shares of the
Company's  common stock fair valued at $.93 per share.  An  additional  bonus of
$25,000 and 3,000 shares of the  Company's  common stock is payable on March 31,
1998, subject to continued employment.

                                        8

<PAGE>
NOTE C - CONTINGENCIES

     An  affiliate  of  Vanguard  Ventures,  Inc.  ("Vanguard"),  the  Company's
majority  stockholder,  was  indebted  under a first  mortgage in the  principal
amount of  $4,081,000.  The mortgage  securing this loan provides that a default
under such loan is a default  under each of the Company's  Hillside  Terrace and
Whitcomb  Tower  Mortgages.  Therefore,  a  potential  Vanguard  default on this
affiliate's  loan  could  result in the  foreclosure  of  Hillside  Terrace  and
Whitcomb Tower.

     Health  care and  senior  living  facilities  are  areas of  extensive  and
frequent  regulatory  change.  Changes  in the  laws or new  interpretations  of
existing laws can have a significant effect on methods of doing business,  costs
of doing  business and amounts of  reimbursement,  from  governmental  and other
payors.  The Company at all times attempts to comply with all  applicable  fraud
and abuse  laws;  however,  there can be no  assurance  that  administrative  or
judicial interpretation of existing laws or regulations will not have a material
adverse effect on the Company's operations or financial conditions.

NOTE D - PROPOSED PUBLIC OFFERING

     The Company has filed a Registration  Statement on Form SB-2 (No. 33-80812)
for sale to the public of up to 2,070,000  shares of common stock and  2,070,000
common stock purchase warrants  ("Warrants"),  each warrant to purchase one-half
share of Common Stock (the "Common Stock Offering").  The Company has also filed
a Registration  Statement on Form SB-2 (No. 333-09037) for sale to the public of
up to $14,375,000  aggregate  amount  Convertible  Senior Secured Notes Due 2006
(the  "Notes  Offering,"  and,  together  with the Common  Stock  Offering,  the
"Offerings").  The notes to be sold in the Notes  Offering are to be convertible
into  shares of common  stock.  The  Company  expects  that the  Offerings  will
commence  as soon as market  conditions  in the  assisted  living  sector of the
public market improve.

     The Company  intends to use the net proceeds of the Offerings and available
lines  of  credit,   together  with  cash  flows  from  operations  and  private
placements,   to  finance  its  operations  (including  expenses  of  additional
personnel  required  as the  Company's  business  grows) and future  development
projects.  The Company  believes  that existing  cash  balances,  cash flow from
operations  and  available  lines  of  credit,  will be  sufficient  to meet its
liquidity and capital spending requirements for at least 12 months.

NOTE E - PROMISSORY NOTE

     In August 1996, the Company  received a $450,000  installment loan from the
Bank of New  York.  The  Principal  is  payable  in 36 equal  installments  plus
interest at prime plus 1 1/2.

                                        9
<PAGE>
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

SIX MONTHS ENDED 1996 VS. 1995

REVENUES

     Net  revenues  of United  Vanguard Homes,  Inc. (the  "Company")  represent
gross consolidated revenues of the Company, less charitable and SSI discounts.

     Net  revenues  decreased by $179,000,  or 4%, from  $4,156,000  in the 1995
period to $3,977,000 in the 1996 period.  Approximately $281,000 of the decrease
represented  development  fees.  Development  fees can vary  substantially  from
quarter to quarter  depending  upon the number of projects in  development,  the
percentage  of  completion  and,  in  certain  instances,  the  project  owner's
financial condition. Development fees are generally deferred in periods in which
the  project  owner's  ability to remit  such fees is  uncertain.  Resident  and
healthcare  services revenues  increased by $102,000,  or 3%, from $3,736,000 in
the 1995  period to  $3,838,000  in the 1996  period.  Resident  and  healthcare
services  revenues  increased  as a result of  higher  rates as well as a slight
increase in occupancy rates.

RESIDENCE OPERATING EXPENSES

     Residence  operating  expenses include all retirement and healthcare center
operating  expenses,  including,  among other  things,  payroll and  employments
costs, food, utilities, repairs and maintenance, insurance and property taxes.

     Residence operating expenses increased by $115,000,  or 4%, from $2,861,000
in the 1995 period to  $2,976,000  in the 1996  period.  During the 1996 period,
payroll costs  increased by  approximately  $72,000 due to salary  increases and
additional  personnel.  Further,  in the  1996  period,  $35,000  of  additional
maintenance  was performed at the Company's  Michigan  facilities as part of the
Company's refurbishment plan.

GENERAL AND ADMINISTRATIVE EXPENSES

     General and administrative expenses include all marketing costs, as well as
the general and  administrative  expenses  incurred at the  Company's  principal
executive  offices.  General and  administrative  expenses include,  among other
things,   administrative  salaries,  rent,  utilities,   insurance  and  related
expenses.

     General and  administrative  expenses  increased by $145,000,  or 90%, from
$163,000  in the 1995 period to $308,000  in the 1996  period.  The  increase is
primarily attributable to increased administrative staff and salary increases.

PROVISION FOR RECOVERY ON ADVANCES TO AFFILIATES

     Losses on advances to  affiliates  decreased by $354,000 in the 1995 period
to $43,000 in the 1996 period.  The decrease is  primarily  attributable  to the
Company's  successful turn around efforts at the Whittier,  an affiliate managed
by the  Company,  and by a reduction  in operating  cash  requirements  of other
affiliates.

INTEREST EXPENSE, NET

     Interest expense,  net, decreased by $78,000 or 22%, from $348,000,  in the
1995  period  to  $279,000  in  the  1996  period.  The  decrease  is  primarily
attributable to the conversion of $1,305,000 of debt to equity.

                                       10

<PAGE>
DEBT CONVERSION EXPENSE

     The  Company  offered its  debtholders  an  inducement  in  the  form  of a
reduced  conversion  price on its then  outstanding  debt.  As a result  of such
inducement an aggregate of $1,305,000 of the Company's  debt was converted  into
347,996  shares of the  Company's  Common Stock  effective  April 1, 1996.  As a
result of such  inducement,  the Company issued 167,877  additional  shares upon
conversion,  the fair  value of  which,  $156,466,  has  been  recorded  as debt
conversion expense during the 1996 period.

INCOME TAXES

     Income taxes increased by $15,000,  or 18%, from $87,000 in the 1995 period
to $102,000 in the 1996  period.  The  increase in the  effective  tax rate from
40.7% in the 1995  period to 50.5% in the 1996  period is  primarily  due to the
non-deductibility of the debt conversion expense.

LIQUIDITY AND CAPITAL RESOURCES

     At September 30, 1996 the Company's  cash position was improved by $428,000
due to the August 1996 installment loan. Current liabilities were up $4,500,000,
primarily due to the  reclassification  of part of the  Company's  mortgage debt
from  long-term to  short-term.  Mortgages on Hillside  Terrace and the Whitcomb
Tower in the amount of $4,340,000  are due April 30, 1997.  Failure to extend or
refinance  these  mortgages  would  have a  material  adverse  effect on the the
Company.  However, the Company anticipates that these mortgages will be extended
on a year-to-year  basis as they have been for the last two years.  In addition,
the Company is pursuing alternate permanent financing for these properties.

     The  Company  has  filed a  Registration  Statement  on Form  SB-2  (No.
33-80812)  for sale to the public of up to 2,070,000  shares of Common Stock and
2,070,000 common stock purchase warrants ("Warrants"),  each warrant to purchase
one-half  share of Common Stock.  The  Company  has also filed a Registration
Statement  on  Form  SB-2  (No.333-09037)  for  sale  to  the  public  of  up to
$14,375,000  aggregate  amount of its Convertible  Senior Secured Notes Due 2006
(the  "Notes  Offering,"  and,  together  with the Common  Stock  Offering,  the
"Offerings").  The notes to be sold in the Notes  Offering are to be convertible
into shares of Common Stock.  The  Company  expects that the  Offerings  will
commence  as soon as market  conditions  in the  assisted  living  sector of the
public market improve.

     The  Company  intends  to use  the  net   proceeds  of  the  Offerings  and
available lines of credit,  together with cash flows from operations and private
placements,   to  finance  its  operations  (including  expenses  of  additional
personnel  required  as the  Company's  business  grows) and future  development
projects.  The Company  believes  that existing  cash  balances,  cash flow from
operations  and  available  lines  of  credit,  will be  sufficient  to meet its
liquidity and capital spending requirements for at least 12 months.

     When used in Management's Discussion and Analysis or Plan of Operation, the
words "anticipate,"  "estimate" and similar expressions are intended to identify
forward-looking  statements.  These  statements are subject to certain risks and
uncertainties  that could cause actual results to differ  materially  from those
projected, including reduced sales and increases in raw materials and production
costs.



THREE MONTHS 1996 VS. 1995

     The principal  reasons for the increases in operations for the three months
ended  September  30, 1996 vs. 1995 are  outlined in the  discussion  of the Six
Months  Results.  No material items which adversely  affected  liquidity and the
financial position occurred in the three-month period.

                                       11

<PAGE>
PART II   OTHER INFORMATION


ITEM 6 -- EXHIBITS AND REPORTS ON FORM 8-K


    (a)  Exhibits

              Exhibit 11, Computation of Earnings Per Share.
              Exhibit 27, Financial Data Schedule.

    (b)  Report on 8-K

              No reports on Form 8-K were filed during this period.


                                       12

<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.



                                     /S/ CARL G. PAFFENDORF
                                     -----------------------------------------
                                     Carl G. Paffendorf, Chairman of the Board



                                     /S/ PAUL D'ANDREA
                                     ------------------------------------------
                                     Paul D'Andrea, Vice President - Finance


Date:       November 14, 1996

                                       13