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 December 31, 1997
                               -----------------

/ /      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 / /

         State the number of shares  outstanding of each of the issuer's classes
of common equity,  as of the latest  practicable  date: At March 31, 1999, there
were outstanding  3,313,265 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.

         Unaudited Consolidated Balance Sheets - December 31, 1997 and
           March 31, 1997......................................................2

         Unaudited Consolidated Statement of Earnings
           Three Months Ended December 31, 1997 and 1996 and
           Nine Months Ended December 31, 1997 and 1996 .......................4

         Unaudited Consolidated Statement of Stockholders' Deficiency
           Nine Months Ended December 31, 1997.................................5

         Unaudited Consolidated Statement of Cash Flows
           For the Nine Months Ended December 31, 1997 and 1996................6

         Notes to Unaudited Consolidated Financial Statements..................7

         Management's Discussion and Analysis of Plan of Operation.............9



PART II. Other Information:

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

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



<PAGE>

                  UNITED VANGUARD HOMES, INC. AND SUBSIDIARIES

                      UNAUDITED CONSOLIDATED BALANCE SHEET



                                     ASSETS

<TABLE>
<CAPTION>
                                                             December 31,       March 31,
CURRENT ASSETS                                                   1997             1997
                                                                 ----             ----

<S>                                                          <C>              <C>
      Cash                                                   $  242,695       $  202,924
      Accounts receivable, less allowance for doubtful
        accounts of $40,000                                     529,061          547,812
      Due from affiliates, net                                  328,874          267,607
      Prepaid expenses and other                                217,711          518,393
                                                             ----------       ----------
                 Total current assets                         1,318,341        1,536,736


PROPERTY AND EQUIPMENT - NET                                  2,157,045        2,276,651


OTHER ASSETS

      Development fees                                          979,200          795,500
      Restricted assets                                         108,352           99,600
      Other assets                                              202,569          176,437
                                                             ----------       ----------
                                                              1,290,121        1,071,537
                                                             ----------       ----------

                                                             $4,765,507       $4,884,924
                                                             ==========       ==========
</TABLE>



The accompanying notes are an integral part of these statements.



                                        2

<PAGE>
                  UNITED VANGUARD HOMES, INC. AND SUBSIDIARIES

                      UNAUDITED CONSOLIDATED BALANCE SHEET


                    LIABILITIES AND STOCKHOLDERS' DEFICIENCY

<TABLE>
<CAPTION>

                                                                                           Dec. 31,            March 31,
                                                                                             1997                1997
                                                                                             ----                ----
CURRENT LIABILITIES
<S>                                                                                    <C>                 <C>
      Current portion of long-term debt                                                $    535,179        $    264,918
      Accounts payable                                                                      525,125             487,758
      Accrued expenses                                                                      704,260             660,084
      Public Offering Costs                                                                 407,383             587,000
      Income taxes payable                                                                  178,517             190,749
                                                                                       ------------        ------------
                 Total Current Liabilities                                                2,350,464           2,190,509

RESIDENT SECURITY DEPOSITS                                                                  273,473             284,526

LONG-TERM DEBT, less current portion                                                      6,063,068           6,334,265

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, 3,308,850 shares and 3,320,950 shares,
        December 31, 1997 and March 31, 1997, respectively                                   33,089              33,210
      Additional paid-in capital                                                          6,995,847           7,043,226
      Accumulated deficit                                                               (10,950,434)        (11,000,812)
                                                                                       ------------        ------------
                                                                                         (3,921,498)         (3,924,376)
                                                                                       ------------        ------------
                                                                                       $  4,765,507        $  4,884,924
                                                                                       ============        ============
</TABLE>


The accompanying notes are an integral part of these statements.



                                        3

<PAGE>
                  UNITED VANGUARD HOMES, INC. AND SUBSIDIARIES

                  UNAUDITED CONSOLIDATED STATEMENT OF EARNINGS

<TABLE>
<CAPTION>
                                                       For the Three Months Ended             For the Nine Months
                                                                December 31,                   Ended December 31,
                                                         1997                1996             1997               1996
                                                         ----                ----             ----               ----

Operating Revenues:
<S>                                                 <C>                <C>                <C>                <C>
     Resident Services                              $ 1,183,977        $ 1,256,595        $ 3,537,665        $ 3,777,826
     Health care services                               662,161            656,567          2,048,173          1,973,387
     Management Fees                                     30,000             30,000             90,000             30,000
Development fees                                         60,700             81,040            183,700            220,000
                                                    -----------        -----------        -----------        -----------
                                                      1,936,838          2,024,202          5,859,538          6,001,213

Operating Expenses:
     Residence operating expenses                     1,531,076          1,590,863          4,561,150          4,566,278
     General and administrative                         261,471            249,824            804,440            557,967
     Depreciation and amortization                       68,087             65,966            204,263            203,922
     Provision for loss on (recovery of)
      advances to affiliates                                  0            (15,000)            42,494
                                                    -----------        -----------        -----------        -----------
                                                      1,860,634          1,906,653          5,554,853          5,370,661

            Income from operations                       76,204            117,549            304,685            630,552

Other Income (expense)
     Interest expense, net                             (134,042)          (145,399)          (421,364)          (415,327)
     Other income                                        56,761             13,531             86,540            129,677
     Debt conversion expense                               --                    0                  0           (156,466)
     Public Offering costs (Loss) Recovery              130,617         (1,000,000)           134,617         (1,000,000)
                                                    -----------        -----------        -----------        -----------

            Income (loss) before income taxes           129,540         (1,014,319)           104,478           (811,564)

Income Taxes                                             17,989            (47,492)            54,000             55,008
                                                    -----------        -----------        -----------        -----------

            NET INCOME (LOSS)                       $   111,551        ($  966,827)       $    50,478        $  (866,572)
                                                    ===========        ===========        ===========        ===========

Earnings per share (loss)                           $      0.03        ($     0.43)       $      0.02        ($     0.39)

Common shares and equivalents outstanding             3,308,932          2,252,689          3,306,395          2,243,895
</TABLE>




The accompanying notes are an integral part of these statements.




                                        4

<PAGE>
                  UNITED VANGUARD HOMES, INC. AND SUBSIDIARIES

          UNAUDITED CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIENCY

                       NINE MONTHS ENDED DECEMBER 31, 1997

<TABLE>
<CAPTION>

                                                                  Additional
                                                                    Paid-in          Accumulated
                                         Shares        Amount      Capital             Deficit              Total
                                         ------        ------      -------             -------              -----

<S>                                     <C>            <C>          <C>              <C>                <C>
Balance, March 31, 1997                 3,320,950      $33,210      $7,043,226       ($11,000,812)      ($3,924,376)

Shares purchased and
  simultaneously retired                  (19,600)        (196)        (69,804)                             (70,000)

Investment in Vanguard Homes
  of N.J., Inc.                                                                             (100)              (100)

Shares issued as compensation               7,500           75          22,425                               22,500

Net Income                                                                                50,478             50,478
                                        ---------      -------      ----------       ------------       -----------

Balance, December 31, 1997              3,308,850      $33,089      $6,995,847       ($10,950,434)      ($3,921,498)
                                        =========      =======      ==========       ============       ===========
</TABLE>



The accompanying notes are an integral part of these statements.


                                        5

<PAGE>
                  UNITED VANGUARD HOMES, INC. AND SUBSIDIARIES

                 UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS

                     FOR THE NINE MONTHS ENDED DECEMBER 31,
<TABLE>
<CAPTION>

                                                                                       1997                 1996
                                                                                       ----                 ----
Cash flows from operating activities:
<S>                                                                                    <C>               <C>
  Net income                                                                           $ 50,478          ($866,572)
  Adjustments to reconcile net income to net cash provided by
   operating activities:
          Depreciation and amortization                                                 202,094            238,925
          Common stock issued for services                                               22,500              2,781
          Debt Conversion expense                                                          -               156,466

          Changes in operating assets and liabilities:
            Accounts receivable, advances and other receivables                          18,752            (73,708)
            Prepaid expenses                                                            313,108             18,578
            Other assets                                                                (35,086)              -
            Development fees                                                           (183,700)           154,806
            (Decrease) in due to affiliates                                             (61,267)           (61,278)
            Accounts payable                                                             37,367           (252,565)
            Accrued expenses                                                           (135,442)           611,642
            Income taxes payable                                                       ( 12,232)           (26,000)
            Resident security deposits                                                 ( 11,053)               507
                                                                                       --------         ----------

Net cash provided by operating activities:                                              205,519            (96,418)
                                                                                       --------         ----------

Cash flows used in investing activities:
  Investment in VHNJ                                                                       (100)              -
  Purchases of property and equipment                                                   (73,535)           (97,009)
                                                                                       --------         ----------
                                                                                        (73,635)           (97,009)
                                                                                       --------         ----------
Cash flows from financing activities:
  Proceeds from borrowings on mortgages and notes payable                               225,000            500,000
          Principal repayments of mortgages and notes payable                          (238,361)          (180,412)
          Common stock purchased and simultaneously retired                             (70,000)              -
          Proceeds from exercised warrants                                                 -               207,074
          Increase in deferred costs                                                       -                (8,660)
          Restricted cash financing                                                      (8,752)              -
                                                                                       --------         ----------
Net cash used financing activities                                                      (92,113)           518,002
                                                                                       --------         ----------

NET INCREASE IN CASH                                                                      39,771           324,575
Cash at beginning of period                                                              202,924           210,245
                                                                                       ---------        ----------
Cash at end of period                                                                  $ 242,695        $  534,820
                                                                                       =========        ==========

Cash paid during the period for
          Interest                                                                     $ 376,642        $  416,000
                                                                                       =========        ==========
          Income taxes                                                                 $  58,270        $   81,000
                                                                                       =========        ==========

Schedule of noncash investing and financing activities:
  Capital leases for furniture and equipment                                           $    -           $   47,591
  Debt converted to equity                                                                  -           $1,305,000
                                                                                       ---------        ----------
                                                                                       $    -           $1,352,591
                                                                                       =========        ==========
</TABLE>


The accompanying notes are an integral part of these statements.



                                        6

<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 March 31, 1997 and
December  31, 1997,  the related  consolidated  statements  of earnings and cash
flows for the  three-month  periods  ended  December 31, 1997 and 1996,  and the
statement of stockholders'  deficiency for the nine-month  period ended December
31, 1997 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 nine
months ended December 31, 1997 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-KSB for the year ended March 31, 1997.
The  results  of  operations  for the period  ended  December  31,  1997 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  mortgage  holders 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 three months ended June 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  non-employee  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  non-employee  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
non-employee  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 -- beginning on the first anniversary on the date of the grant.

     Prior to the adoption of the  Directors'  Plan,  options had been issued to
outside directors,  of which options to purchase ____ shares were outstanding at
December 31, 1997.


                                        7

<PAGE>

     Employment Agreement

     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 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.

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 - Promissory Note

     In August 1996, the Company received a $450,000 installment loan from State
Bank of Long  Island.  The  principal is payable in 36 equal  installments  plus
interest at prime plus 1 1/2 percent.

     In  September  1997,  the Company  received  $75,000 on a  promissory  note
payable  to  State  Bank  of  Long  Island.  The  principal  is  payable  in one
installment, due November 8, 1997, with interest at prime plus 1 1/2 percent.

     In December 1997,  the Company  received  $150,000 on promissory  note to a
private  party.  The note is due June 30, 1998 and bears  interest at 20 percent
per annum.




                                        8

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

Nine Months Ended 1996 vs. 1997

Revenues

     Net revenues of the Company represent its gross consolidated revenues, less
charitable and Supplementary Social Security Income discounts.

     Net revenues  decreased by $142,000,  or 2 percent,  from $6,001,000 in the
1996 period to $5,859,000 in the 1997 period.  The primary cause was a reduction
in Resident  Services Revenues which decreased by $240,000,  or 6 percent,  from
$3,778,000 in the 1996 period to $3,538,000 in the 1997 period. The decrease was
a result of a reduction in occupancy due to a temporary  mortorium on admissions
at one of the Company's facilities. From January to October 1997, Olds Manor was
subject  to a  moratorium  on  admissions  in the  Home  for the Aged due to the
allegation  that certain  services  being  rendered were beyond the scope of the
facility's  Home for the  Aged  License.  As a  consequence  of the  moritorium,
occupancy  dropped from 95 percent,  as of March 31, 1996, to 66 percent,  as of
December 31, 1997.

     Healthcare  services  revenues  increased  by $75,000,  or 4 percent,  from
$1,973,000 in the 1996 period to $2,048,000 in the 1997 period. The increase was
a result of higher rates.

     Management  fees of $90,000  were earned  this  period on a contract  which
began October 1, 1996.

     Development Fee income decreased by $36,000 or 17 percent, from $220,000 in
the 1996 period to $184,000 in the 1997  period.  These fees are lower this year
since  they are based on a 1995  development  agreement  which is  substantially
completed.

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 were slightly lower ($5,000) than last year.
The decrease was primarily attributed to operating cost reductions at Olds Manor
in the current quarter.

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 $246,000,  or 44 percent,
from $558,000 in the 1996 period to $804,000 in the 1997 period. The increase is
primarily  attributable  to an  increase in  personnel  costs and an increase in
overhead  associated with the Company's  attempted  public offering and plans to
expand its development projects.


                                        9

<PAGE>
Provision for Recovery on Advances to Affiliates

     During the nine months ended December 31, 1997, the Company  recorded a net
recovery of Advances to Affiliates aggregating $15,000 as compared to a net loss
on Advances  of $42,000 in the 1996  period.  The  variance is a function of net
funds paid out or received from the Company's  parent  (Vanguard) and affiliated
companies.  Future recoveries are anticipated as Vanguard liquidates some of its
properties.

Interest Expense, Net

     Interest expense,  net, increased by $6,000, or 1 percent, from $415,000 in
the 1996 period to  $421,000  in the 1997  period.  The  increase  is  primarily
attributable to increased borrowing (see Note D).

Debt Conversion Expense

     The Company offered its debt holders 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.

Three Months 1998 vs. 1997

The principal  reasons for the changes in operations  for the three months ended
December  31, 1997 vs. 1996 are  outlined in the  discussion  of the Nine Months
Results.  No material items which adversely affected liquidity and the financial
position occurred in the three-month period.

Liquidity and Capital Resources

     During the 1997 period operating  activities provided cash of approximately
$205,000  compared to requiring  cash of  approximately  $97,000 from  operating
activities  in the 1996  period.  The  increase  in cash  flows  from  operating
activities  was  principally  due to the  Company's  net  profit in the  current
period.

     During the 1997  period the  Company  required  approximately  $92,113  for
financing  activities  compared to providing cash from  financing  activities of
approximately  $518,000  in the 1996  period.  The  decline  in cash  flows from
financing  activities was principally  due to $275,000 in reduced  borrowing for
the current  period and  approximately  $207,000 of  proceeds  from  exercise of
warrants which occurred only in year 1996.

     As of December 31, 1997 the Company had a deficiency in working  capital of
$1,032,000.  Of this  deficiency  $654,000 was the result of last year's aborted
public offering.

     In the current  period the Company  borrowed  $225,000 in short-term  notes
(see Note D) to fund  financing  and investing  activities.  The effect of these
loans and use to fund  noncurrent  obligations  was the  principal  cause of the
$378,000 increase in working capital deficit.

     The Company's capital is not sufficient to fund its operating plans.  Given
the above, the Company is currently negotiating to sell a substantial portion of
its operating and  development  properties.  If such sales are  successful,  the
Company would have adequate capital to fund future development projects.



                                       10

<PAGE>
In  addition,  the  Company  received  a  commitment  letter  from  a  financial
institution  to  refinance  substantially  all  of  its  outstanding  mortgages.
Although  this  commitment  letter has  expired,  the  Company  believes  it can
successfully  renegotiate  this financing  alternative,  which, in the Company's
opinion, would provide adequate working capital.




                                       11

<PAGE>
                          Part II -- OTHER INFORMATION

Item 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     None during the quarter ended December 31, 1997.



Item 6 - EXHIBITS AND REPORTS ON FORM 8-K

     (a)    Exhibits

                  Exhibit 11, Unaudited Computation of Earnings Per Share
                  Exhibit 27, Unaudited 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 Securities and Exchange Act of
1934, as amended,  the Registrant  caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.

                                   UNITED VANGUARD HOMES, INC.



                                  by: /s/ Carl G. Paffendor
                                      ------------------------------------------
                                      Carl G. Paffendorf, Chairman of the Board


                                  by: /s/ Paul D'Andrea
                                      ------------------------------------------
                                      Paul D'Andrea, Vice President - Finance




Date: July 22, 1999

                                       13