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

                        Quarterly or Transitional Report

                     U.S. Securities and Exchange Commission

                             Washington, D.C. 20549

                                   Form 10-QSB

(Mark One)
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
    Act of 1934

                    For the quarterly period ended June 30, 2000


[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
    Act of 1934


                For the transition period from _________to _________

                         Commission file number 0-14554

                           NATIONAL PROPERTY INVESTORS 8
         (Exact name of small business issuer as specified in its charter)



         California                                         13-3254885
(State or other jurisdiction of                          (I.R.S. Employer
 incorporation or organization)                         Identification No.)

                          55 Beattie Place, P.O. Box 1089
                        Greenville, South Carolina 29602

                      (Address of principal executive offices)

                                 (864) 239-1000

                           (Issuer's telephone number)

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

<PAGE>

                         PART I - FINANCIAL INFORMATION

ITEM 1.     FINANCIAL STATEMENTS

a)

                           NATIONAL PROPERTY INVESTORS 8

                                  BALANCE SHEET

                                   (Unaudited)

                          (in thousands, except unit data)

                                  June 30, 2000
<TABLE>
<CAPTION>

Assets

<S>                                                                          <C>
   Cash and cash equivalents                                                 $  715
   Receivables and deposits                                                     337
   Restricted escrows                                                           555
   Other assets                                                                 352
   Investment properties:
       Land                                                  $  1,970
       Buildings and related personal property                 29,154
                                                               31,124
       Less accumulated depreciation                          (18,163)       12,961
                                                                           $ 14,920

Liabilities and Partners' Deficit
Liabilities

   Accounts payable                                                          $   83
   Tenant security deposit liabilities                                           67
   Accrued property taxes                                                       484
   Other liabilities                                                            286
   Mortgage notes payable                                                    14,772

Partners' Deficit

   General partner                                            $  (231)
   Limited partners (44,882 units
      issued and outstanding)                                    (541)         (772)
                                                                           $ 14,920
</TABLE>

                   See Accompanying Notes to Financial Statements

<PAGE>

b)

                           NATIONAL PROPERTY INVESTORS 8

                            STATEMENTS OF OPERATIONS

                                   (Unaudited)

                          (in thousands, except unit data)
<TABLE>
<CAPTION>

                                       Three Months Ended         Six Months Ended
                                            June 30,                  June 30,
                                       2000          1999         2000         1999
Revenues:
<S>                                   <C>          <C>          <C>          <C>
   Rental income                      $ 1,092      $ 1,116      $ 2,214      $ 2,246
   Other income                            90           77          164          151
     Total revenues                     1,182        1,193        2,378        2,397

Expenses:
   Operating                              458          408          842          805
   General and administrative              66           40          177           80
   Interest                               266          229          498          459
   Depreciation                           326          307          646          608
   Property taxes                         127          128          249          241
     Total expenses                     1,243        1,112        2,412        2,193

(Loss) income before
   extraordinary item                     (61)          81          (34)         204
Extraordinary loss on early
   extinguishment of debt                (181)          --         (181)          --

Net (loss) income                     $  (242)        $ 81       $ (215)       $ 204

Net (loss) income allocated to
  general partner (1%)                     (2)           1           (2)           2

Net (loss) income allocated to
  limited partners (99%)                 (240)          80         (213)         202

                                      $  (242)        $ 81       $ (215)       $ 204
Per limited partnership unit:
  (Loss) income before
    extraordinary item                $ (1.36)      $ 1.78      $ (0.76)      $ 4.50
  Extraordinary loss on the
    early extinguishment of debt        (3.99)          --        (3.99)          --

Net (loss) income                     $ (5.35)      $ 1.78      $ (4.75)      $ 4.50

Distributions per limited
  partnership unit                    $ 73.37        $ --       $ 96.05      $ 18.76
</TABLE>

                   See Accompanying Notes to Financial Statements

<PAGE>

c)

                           NATIONAL PROPERTY INVESTORS 8

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

                          (in thousands, except unit data)


<TABLE>
<CAPTION>

                                     Limited
                                   Partnership   General      Limited
                                      Units      Partner     Partners       Total

<S>                                   <C>          <C>        <C>          <C>
Original capital contributions        44,882       $   1      $22,441      $22,442

Partners' (deficit) capital at
   December 31, 1999                  44,882      $ (185)     $ 3,983      $ 3,798

Distributions to partners                 --         (44)      (4,311)      (4,355)

Net loss for the six months
   ended June 30, 2000                    --          (2)        (213)        (215)

Partners' deficit at
   June 30, 2000                      44,882      $ (231)      $ (541)      $ (772)
</TABLE>

                   See Accompanying Notes to Financial Statements

<PAGE>

d)

                           NATIONAL PROPERTY INVESTORS 8

                            STATEMENTS OF CASH FLOWS

                                   (Unaudited)

                                   (in thousands)

<TABLE>
<CAPTION>

                                                                    Six Months Ended
                                                                        June 30,

                                                                     2000        1999
Cash flows from operating activities:

<S>                                                                 <C>          <C>
  Net (loss) income                                                 $ (215)      $ 204
  Adjustments to reconcile net (loss) income to net cash
   provided by operating activities:
     Depreciation                                                      646         608
     Amortization of loan costs                                         18          19
     Extraordinary loss on early extinguishment of debt                181          --
     Change in accounts:
        Receivables and deposits                                      (230)         37
        Other assets                                                   (43)        (29)
        Accounts payable                                                16          11
        Tenant security deposit liabilities                             (5)          2
        Accrued property taxes                                         (10)        (43)
        Other liabilities                                               63          16

          Net cash provided by operating activities                    421         825

Cash flows from investing activities:

  Property improvements and replacements                              (283)       (164)
  Net (deposits to) withdrawals from restricted escrows               (454)        726

          Net cash (used in) provided by investing activities         (737)        562

Cash flows from financing activities:

  Payments on mortgage note payable                                    (22)        (35)
  Payoff of mortgage note payable                                   (3,364)         --
  Proceeds from mortgage note payable                                7,372          --
  Prepayment penalty                                                  (168)         --
  Loan costs paid                                                     (175)         --
  Distributions to partners                                         (4,355)       (850)

          Net cash used in financing activities                       (712)       (885)

Net (decrease) increase in cash and cash equivalents                (1,028)        502

Cash and cash equivalents at beginning of period                     1,743       1,746

Cash and cash equivalents at end of period                          $  715     $ 2,248

Supplemental disclosure of cash flow information:
  Cash paid for interest                                            $  458      $ 441
</TABLE>

                   See Accompanying Notes to Financial Statements

<PAGE>

e)

                           NATIONAL PROPERTY INVESTORS 8

                          NOTES TO FINANCIAL STATEMENTS

                                   (Unaudited)

Note A - Basis of Presentation

The accompanying unaudited financial statements of National Property Investors 8
(the  "Partnership"  or  "Registrant")  have been  prepared in  accordance  with
generally accepted accounting  principles for interim financial  information and
with  the  instructions  to Form  10-QSB  and Item  310(b)  of  Regulation  S-B.
Accordingly,  they do not include all of the information and footnotes  required
by generally accepted accounting  principles for complete financial  statements.
In the opinion of NPI Equity  Investments,  Inc.  ("NPI Equity" or the "Managing
General  Partner"),  all adjustments  (consisting of normal recurring  accruals)
considered  necessary  for a fair  presentation  have been  included.  Operating
results  for the  three  and six  month  periods  ended  June  30,  2000 are not
necessarily  indicative  of the results that may be expected for the fiscal year
ending  December  31,  2000.  For further  information,  refer to the  financial
statements and footnotes thereto included in the Partnership's  Annual Report on
Form 10-KSB for the year ended December 31, 1999.

Note B - Transfer of Control

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

Note C - Transactions with Affiliated Parties

The  Partnership  has no employees  and is  dependent  on the  Managing  General
Partner  and  its  affiliates  for  the  management  and  administration  of all
Partnership  activities.  The  Partnership  Agreement  provides  for payments to
affiliates for services and as  reimbursement  of certain  expenses  incurred by
affiliates on behalf of the Partnership. The following payments were made to the
Managing  General  Partner and  affiliates  during the six months ended June 30,
2000 and 1999:

                                                                  2000      1999
                                                                  (in thousands)
 Property management fees (included in operating expenses)        $120      $122
 Reimbursement for services of affiliates (included in
   investment properties and operating and general and
   administrative expenses)                                         64        50
 Non-accountable partnership reimbursement (included in
   general and administrative expense)                              91        --
 Loan costs (included in other assets)                              74        --

During the six months ended June 30, 2000 and 1999,  affiliates  of the Managing
General  Partner were entitled to receive 5% of gross  receipts from both of the
Registrant's   properties  for  providing  property  management  services.   The
Registrant paid to such affiliates  approximately  $120,000 and $122,000 for the
six months ended June 30, 2000 and 1999, respectively.

<PAGE>

An  affiliate  of  the  Managing  General  Partner  received   reimbursement  of
accountable  administrative  expenses  amounting  to  approximately  $64,000 and
$50,000 for the six months ended June 30, 2000 and 1999, respectively.

For services relating to the  administration of the Partnership and operation of
its properties,  the Managing General Partner is entitled to receive payment for
non-accountable  expenses up to a maximum of $150,000 per year of  distributions
from  operations  based upon the number of  Partnership  units sold,  subject to
certain limitations. The Managing General Partner received approximately $91,000
for  the  six  months   ended  June  30,   2000  for   non-accountable   expense
reimbursements.  The  Managing  General  Partner  was not  entitled to receive a
similar  reimbursement  during the six months ended June 30, 1999 because  there
were no distributions from operations.

In addition to reimbursement for services of affiliates, the Partnership paid an
affiliate of the General Partner approximately $74,000 for loan costs related to
the  refinancing of one of the  Partnership's  properties  during the six months
ended June 30,  2000.  These costs were  capitalized  and are  included in other
assets on the consolidated balance sheet.

The Managing  General Partner has  established a revolving  credit facility (the
"Partnership  Revolver")  to be used to fund  deferred  maintenance  and working
capital needs of the Partnership.  The maximum draw available to the Partnership
under the Partnership Revolver is $500,000. Loans under the Partnership Revolver
will have a term of 365 days,  be unsecured  and bear interest at the rate of 2%
per  annum in  excess of the  prime  rate  announced  from time to time by Chase
Manhattan  Bank.  The maturity date of such borrowing will be accelerated in the
event of: (i) the removal of the managing  general  partner  (whether or not For
Cause);  (ii) the sale or refinancing of a property by the Partnership  (whether
or not a borrowing under the Partnership  Revolver was made with respect to such
property); or (iii) the liquidation of the Partnership.  The Partnership has not
borrowed under the Partnership Revolver to date.

AIMCO and its affiliates  currently own 25,057 limited  partnership units in the
Partnership  representing  55.83% of the  outstanding  units.  A number of these
units were acquired pursuant to tender offers made by AIMCO or its affiliates or
affiliates  of the Managing  General  Partner.  It is possible that AIMCO or its
affiliates will make one or more additional offers to acquire additional limited
partnership  interests in the  Partnership  for cash or in exchange for units in
the operating partnership of AIMCO. Under the Partnership Agreement, unitholders
holding a majority of the Units are  entitled  to take action with  respect to a
variety of matters.  As a result of its  ownership of 55.83% of the  outstanding
units,  AIMCO is in a position to influence all voting decisions with respect to
the Registrant.  When voting on matters,  AIMCO would in all likelihood vote the
Units it acquired in a manner  favorable to the interest of the Managing General
Partner because of their affiliation with the Managing General Partner. However,
DeForest  Ventures II L.P.,  from whom AIMCO,  through its merger with Insignia,
acquired 16,352 units, had agreed for the benefit of non-tendering  unitholders,
that it would vote these 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  unit holders.  Except for the  foregoing,  no other  limitations  are
imposed on AIMCO and its affiliates right to vote each Unit acquired.

<PAGE>

Note D - Distributions

During the six months  ended June 30,  2000,  the  Registrant  declared and paid
distributions  of  approximately  $4,355,000  (approximately  $4,311,000  to the
limited  partners  or  $96.05  per  limited   partnership  unit)  consisting  of
approximately  $1,177,000  (approximately  $1,165,000 to the limited partners or
$25.96  per  limited   partnership   unit)  from  operations  and  approximately
$3,178,000  (approximately  $3,146,000  to the  limited  partners  or $70.09 per
limited  partnership unit) from the refinancing  proceeds of Huntington Athletic
Club Apartments. Subsequent to June 30, 2000, the Registrant declared and paid a
distribution  of  approximately  $69,000  (approximately  $68,000 to the limited
partners or $1.52 per limited partnership unit) from operations.  During the six
months ended June 30, 1999, the Registrant made a distribution of  approximately
$850,000  (approximately  $842,000 to the limited partners or $18.76 per limited
partnership unit) from refinancing and property sale proceeds from prior years.

Note E - Extraordinary Loss on Early Extinguishment

On May 11, 2000, the Partnership  refinanced the mortgage encumbering Huntington
Athletic Club Apartments. The refinancing replaced indebtedness of approximately
$3,364,000  with a new  mortgage in the amount of  $7,372,000.  The new mortgage
carries a stated  interest rate of 8.15% as compared to the 9.85%  interest rate
on the old  mortgage.  Payments on the mortgage  loan are due monthly  until the
loan  matures on June 1, 2020.  In  addition,  the  Partnership  was required to
establish a repair escrow of approximately  $454,000 with the lender for certain
capital replacements.  Total capitalized loan costs were approximately  $175,000
at June 30, 2000. The Partnership  recognized an extraordinary loss on the early
extinguishment  of  debt  of  approximately  $181,000  due to the  write-off  of
unamortized loan costs and a prepayment penalty.

Note F - Segment Reporting

Description  of the types of products  and  services  from which the  reportable
segment  derives its  revenues:  The  Partnership  has one  reportable  segment:
residential properties.  The Partnership's residential property segment consists
of two  apartment  complexes  one located in each of  Indianapolis,  Indiana and
Morrisville,  North Carolina.  The Partnership  rents apartment units to tenants
for terms that are typically twelve months or less.

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

Factors management used to identify the enterprise's  reportable  segments:  The
Partnership's  reportable  segment consists of investment  properties that offer
similar  products and services.  Although each of the  investment  properties is
managed  separately,  they have been aggregated into one segment as they provide
services with similar types of products and customers.

<PAGE>


Segment  information for the three and six month periods ended June 30, 2000 and
1999, is shown in the tables below (in  thousands).  The "Other" column includes
partnership administration related items and income and expense not allocated to
the reportable segment.
<TABLE>
<CAPTION>

       Three months ended June 30, 2000          Residential      Other      Totals

<S>                                                <C>            <C>        <C>
Rental income                                      $ 1,092        $   --     $ 1,092
Other income                                            79            11         90
Interest expense                                       266            --        266
Depreciation                                           326            --        326
General and administrative expense                      --            66         66
Extraordinary loss on early extinguishment
  of debt                                             (181)           --       (181)
Segment loss                                          (187)          (55)      (242)


        Six months ended June 30, 2000           Residential      Other      Totals

Rental income                                      $ 2,214        $   --    $ 2,214
Other income                                           152            12        164
Interest expense                                       498            --        498
Depreciation                                           646            --        646
General and administrative expense                      --           177        177
Extraordinary loss on early extinguishment
  of debt                                             (181)           --       (181)
Segment loss                                           (50)         (165)      (215)
Total assets                                        14,589           331     14,920
Capital expenditures for investment
  properties                                           283            --        283


        Three months ended June 30, 1999          Residential     Other      Totals

Rental income                                      $ 1,116       $   --     $ 1,116
Other income                                            71            6          77
Interest expense                                       229           --         229
Depreciation                                           307           --         307
General and administrative expense                      --           40          40
Segment profit (loss)                                  115          (34)         81


        Six months ended June 30, 1999           Residential     Other      Totals

Rental income                                      $ 2,246       $   --     $ 2,246
Other income                                           134           17         151
Interest expense                                       459           --         459
Depreciation                                           608           --         608
General and administrative expense                      --           80          80
Segment profit (loss)                                  267          (63)        204
Total assets                                        15,754          682      16,436
Capital expenditures for investment
  properties                                           164           --         164
</TABLE>

Note G - Legal Proceedings

In March 1998, several putative unit holders of limited partnership units of the
Partnership  commenced an action  entitled  Rosalie  Nuanes,  et al. v. Insignia
Financial  Group,  Inc., et al. in the Superior Court of the State of California
for the County of San Mateo. The plaintiffs  named as defendants,  among others,
the  Partnership,  its Managing  General Partner and several of their affiliated
partnerships  and corporate  entities.  The action  purports to assert claims on
behalf of a class of limited  partners and derivatively on behalf of a number of
limited  partnerships  (including  the  Partnership)  which are named as nominal
defendants,  challenging the acquisition of interests in certain general partner
entities by Insignia Financial Group, Inc. and entities which were, at one time,
affiliates of Insignia; past tender offers by the Insignia affiliates to acquire
limited  partnership  units;  the  management  of  partnerships  by the Insignia
affiliates;  and the Insignia  Merger.  The plaintiffs seek monetary damages and
equitable relief, including judicial dissolution of the Partnership. On June 25,
1998,  the Managing  General  Partner  filed a motion  seeking  dismissal of the
action.  In lieu of  responding  to the  motion,  the  plaintiffs  have filed an
amended  complaint.  The Managing General Partner filed demurrers to the amended
complaint which were heard February 1999.

Pending the ruling on such  demurrers,  settlement  negotiations  commenced.  On
November 2, 1999,  the parties  executed and filed a Stipulation  of Settlement,
settling claims,  subject to final court approval,  on behalf of the Partnership
and all limited  partners  who owned  units as of November 3, 1999.  Preliminary
approval of the settlement  was obtained on November 3, 1999 from the Court,  at
which time the Court set a final approval  hearing for December 10, 1999.  Prior
to the December 10, 1999 hearing,  the Court received various  objections to the
settlement, including a challenge to the Court's preliminary approval based upon
the alleged lack of authority of prior lead counsel to enter the settlement.  On
December 14, 1999, the Managing  General  Partner and its affiliates  terminated
the  proposed  settlement.  In  February  2000,  counsel  for some of the  named
plaintiffs filed a motion to disqualify plaintiff's lead and liaison counsel who
negotiated  the  settlement.  On June  27,  2000,  the  Court  entered  an order
disqualifying them from the case. The Court will entertain applications for lead
counsel which must be filed by August 4, 2000. The Court has scheduled a hearing
on August 21, 2000 to address the issue of appointing lead counsel. The Managing
General Partner does not anticipate that costs associated with this case will be
material to the Partnership's overall operations.

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

<PAGE>

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

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

The Partnership's  investment properties consist of two apartment complexes. The
following  table sets forth the average  occupancy of the properties for the six
months ended June 30, 2000 and 1999:

                                                  Average Occupancy

      Property                                     2000       1999

      Williamsburg on the Lake Apartments           93%        94%
         Indianapolis, Indiana
      Huntington Athletic Club Apartments           88%        92%
         Morrisville, North Carolina

The Managing General Partner  attributes the decrease in occupancy at Huntington
Athletic  Club  Apartments  to  increased  competition  in the area from six new
apartment  complexes and a plumbing project which causes several units at a time
to be vacant as the work is being completed.

Results of Operations

The  Registrant's  net  loss  for  the  six  months  ended  June  30,  2000  was
approximately  $215,000 as compared to net income of approximately  $204,000 for
the six months  ended June 30,  1999.  The  Registrant's  net loss for the three
month period ended June 30, 2000 was  approximately  $242,000 as compared to net
income of approximately  $81,000 for the three month period ended June 30, 1999.
The increase in net loss for the three and six month periods ended June 30, 2000
was  due  to  the  recognition  in  2000  of  an  extraordinary  loss  on  early
extinguishment of debt, as well as an increase in total expenses, and a decrease
in  total  revenues.  The  extraordinary  loss on early  extinguishment  of debt
relates  to  the  refinancing  of  the  mortgage  at  Huntington  Athletic  Club
Apartments (see discussion below).

The  Partnership  experienced  losses  of  approximately  $61,000  and  $34,000,
respectively,  for the three and six  months  ended  June 30,  2000  before  the
extraordinary  item as  compared  to net  income of  approximately  $81,000  and
$204,000,  respectively,  for the comparable periods in 1999 due to decreases in
revenues and increases in expenses.  Total revenues  decreased for the three and
six month periods  ended June 30, 2000 due to decreased  rental income which was
partially offset by an increase in other income.  Rental income decreased due to
decreased  occupancy  at  both of the  Partnership's  properties  and  increased
concessions at Williamsburg on the Lake Apartments which was partially offset by
increased  average  rental  rates at  Williamsburg  on the Lake  Apartments  and
decreased  concessions  at  Huntington  Athletic Club  Apartments.  Other income
increased  due to an  increase  in tenant  charges at  Williamsburg  on the Lake
Apartments,  increased  corporate  housing  revenue at Huntington  Athletic Club
Apartments and increased local telephone commissions at both properties.

Total expenses increased for the three and six month periods ended June 30, 2000
due to an  increase  in  operating,  interest,  depreciation,  and  general  and
administrative  expenses.  Operating  expenses  increased  primarily  due  to an
increase in payroll  expenses,  utility costs,  and collection costs at both the
Partnership's  properties.  Interest expense increased due to the refinancing of
Huntington Athletic Club Apartments,  as discussed below.  Depreciation  expense
increased due to property  additions during the past twelve months.  General and
administrative  expenses increased over the comparable period due to an increase
in the  non-accountable  partnership  reimbursement paid to the Managing General
Partner  from  distributions  from  operations  as provided  in the  Partnership
Agreement,  and increased professional fees necessary to manage the Partnership.
Included in general and  administrative  expenses at both June 30, 2000 and 1999
are management  reimbursements to the Managing General Partner allowed under the
Partnership  Agreement.  In addition,  costs  associated  with the quarterly and
annual  communications  with  investors and  regulatory  agencies and the annual
audit required by the Partnership Agreement are also included.

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

Liquidity and Capital Resources

At  June  30,  2000,  the  Partnership   held  cash  and  cash   equivalents  of
approximately  $715,000  compared to approximately  $2,248,000 at June 30, 1999.
The decrease of  approximately  $1,028,000  in cash and cash  equivalents  since
December  31, 1999 is due to  approximately  $712,000 of cash used in  financing
activities and approximately $737,000 of cash used in investing activities which
was  partially  offset by  approximately  $421,000 of cash provided by operating
activities.  Cash used in financing activities consisted of distributions to the
partners,  the payoff of the previous debt encumbering  Huntington Athletic Club
Apartments,  payments of principal made on the mortgage  encumbering  Huntington
Athletic Club Apartments,  the payment of loan costs,  and a prepayment  penalty
relating to the  refinance of  Huntington  Athletic  Club  Apartments  partially
offset by proceeds from the refinancing of the mortgage  encumbering  Huntington
Athletic  Club  Apartments.  Cash  used in  investing  activities  consisted  of
property  improvements  and  replacements  and net  deposits to escrow  accounts
maintained by the mortgage lender.  The Partnership  invests its working capital
reserves in money market accounts.

On May 11, 2000, the Partnership  refinanced the mortgage encumbering Huntington
Athletic Club Apartments. The refinancing replaced indebtedness of approximately
$3,364,000  with a new  mortgage in the amount of  $7,372,000.  The new mortgage
carries a stated  interest rate of 8.15% as compared to the 9.85%  interest rate
on the old  mortgage.  Payments on the mortgage  loan are due monthly  until the
loan  matures on June 1, 2020.  In  addition,  the  Partnership  was required to
establish a repair escrow of approximately  $454,000 with the lender for certain
capital replacements.  Total capitalized loan costs were approximately  $175,000
at June 30, 2000.  The  Partnership  recognized an  extraordinary  loss on early
extinguishment  of  debt  of  approximately  $181,000  due to the  write-off  of
unamortized loan costs and a prepayment penalty.

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

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

Williamsburg on the Lake Apartments

During  the  six  months  ended  June  30,  2000,  the   Partnership   completed
approximately  $173,000  of capital  expenditures  at  Williamsburg  on the Lake
Apartments  consisting  primarily of carpet and vinyl replacements,  submetering
improvements, and appliances. These improvements were funded from operating cash
flow and the Partnership's  reserves.  The Partnership has evaluated the capital
improvement  needs of the  property  for the year 2000.  The amount  budgeted is
approximately $328,000,  consisting primarily of parking area improvements,  air
conditioning   unit  replacement,   appliances,   carpet   replacements,   major
landscaping,  and  structural  improvements.   Additional  improvements  may  be
considered and will depend on the physical  condition of the property as well as
replacement reserves and anticipated cash flow generated by the property.

Huntington Athletic Club Apartments

During  the  six  months  ended  June  30,  2000,  the   Partnership   completed
approximately  $110,000 of capital  expenditures  at  Huntington  Athletic  Club
Apartments  consisting primarily of swimming pool upgrades,  carpet replacement,
lighting upgrades, and structural  improvements.  These improvements were funded
from operating cash flow. The Partnership has evaluated the capital  improvement
needs of the property for the year 2000.  The amount  budgeted is  approximately
$158,000, consisting primarily of appliances, carpet replacement, and structural
improvements.  Additional  improvements may be considered and will depend on the
physical  condition  of  the  property  as  well  as  replacement  reserves  and
anticipated cash flow generated by the property.

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

The  Registrant's  current assets are thought to be sufficient for any near-term
needs (exclusive of capital improvements) of the Registrant. Huntington Athletic
Club Apartment's mortgage indebtedness of approximately  $7,372,000 is amortized
over  20  years  and  matures  June  1,  2020.  The  mortgage   encumbering  the
Williamsburg  on the Lake  Apartments  requires  interest only payments with the
principal  balance of  $7,400,000  due in November  2003.  The Managing  General
Partner will attempt to refinance such  indebtedness  and/or sell the properties
prior to such maturity dates. If the properties cannot be refinanced or sold for
a sufficient  amount,  the  Registrant may risk losing such  properties  through
foreclosure.

During the six months  ended June 30,  2000,  the  Registrant  declared and paid
distributions  of  approximately  $4,355,000  (approximately  $4,311,000  to the
limited  partners  or  $96.05  per  limited   partnership  unit)  consisting  of
approximately  $1,177,000  (approximately  $1,165,000 to the limited partners or
$25.96  per  limited   partnership   unit)  from  operations  and  approximately
$3,178,000  (approximately  $3,146,000  to the  limited  partners  or $70.09 per
limited  partnership unit) from the refinancing  proceeds of Huntington Athletic
Club Apartments. Subsequent to June 30, 2000, the Registrant declared and paid a
distribution  of  approximately  $69,000  (approximately  $68,000 to the limited
partners or $1.52 per limited partnership unit) from operations.  During the six
months ended June 30, 1999, the Registrant made a distribution of  approximately
$850,000  (approximately  $842,000 to the limited partners or $18.76 per limited
partnership  unit) from refinancing and property sale proceeds from prior years.
Future cash  distributions  will depend on the levels of net cash generated from
operations,   the  availability  of  cash  reserves,  and  the  timing  of  debt
maturities,  refinancings  and/or property sales. The Registrant's  distribution
policy is reviewed on a semi-annual basis.  There can be no assurance,  however,
that the  Registrant  will  generate  sufficient  funds  from  operations  after
required  capital  improvements to permit further  distributions to its partners
during the remainder of 2000 or subsequent periods.

<PAGE>

                           PART II - OTHER INFORMATION

ITEM 1.     LEGAL PROCEEDINGS

In March 1998, several putative unit holders of limited partnership units of the
Partnership  commenced an action  entitled  Rosalie  Nuanes,  et al. v. Insignia
Financial  Group,  Inc., et al. in the Superior Court of the State of California
for the County of San Mateo. The plaintiffs  named as defendants,  among others,
the  Partnership,  its Managing  General Partner and several of their affiliated
partnerships  and corporate  entities.  The action  purports to assert claims on
behalf of a class of limited  partners and derivatively on behalf of a number of
limited  partnerships  (including  the  Partnership)  which are named as nominal
defendants,  challenging the acquisition of interests in certain general partner
entities by Insignia Financial Group, Inc. and entities which were, at one time,
affiliates of Insignia; past tender offers by the Insignia affiliates to acquire
limited  partnership  units;  the  management  of  partnerships  by the Insignia
affiliates;  and the Insignia  Merger.  The plaintiffs seek monetary damages and
equitable relief, including judicial dissolution of the Partnership. On June 25,
1998,  the Managing  General  Partner  filed a motion  seeking  dismissal of the
action.  In lieu of  responding  to the  motion,  the  plaintiffs  have filed an
amended  complaint.  The Managing General Partner filed demurrers to the amended
complaint which were heard February 1999.

Pending the ruling on such  demurrers,  settlement  negotiations  commenced.  On
November 2, 1999,  the parties  executed and filed a Stipulation  of Settlement,
settling claims,  subject to final court approval,  on behalf of the Partnership
and all limited  partners  who owned  units as of November 3, 1999.  Preliminary
approval of the settlement  was obtained on November 3, 1999 from the Court,  at
which time the Court set a final approval  hearing for December 10, 1999.  Prior
to the December 10, 1999 hearing,  the Court received various  objections to the
settlement, including a challenge to the Court's preliminary approval based upon
the alleged lack of authority of prior lead counsel to enter the settlement.  On
December 14, 1999, the Managing  General  Partner and its affiliates  terminated
the  proposed  settlement.  In  February  2000,  counsel  for some of the  named
plaintiffs filed a motion to disqualify plaintiff's lead and liaison counsel who
negotiated  the  settlement.  On June  27,  2000,  the  Court  entered  an order
disqualifying them from the case. The Court will entertain applications for lead
counsel which must be filed by August 4, 2000. The Court has scheduled a hearing
on August 21, 2000 to address the issue of appointing lead counsel. The Managing
General Partner does not anticipate that costs associated with this case will be
material to the Partnership's overall operations.

ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K

            a) Exhibits:

               Exhibit  10.26,  Multifamily  Note dated May 8,  2000,  by and
               between National  Property  Investors 8, a California  limited
               partnership,  and  GMAC  Commercial  Mortgage  Corporation,  a
               California Corporation.

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

            b) Reports on Form 8-K filed during the quarter ended June 30, 2000:

               None.

<PAGE>

                                   SIGNATURES

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

                                    NATIONAL PROPERTY INVESTORS 8

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

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

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

                                    Date:

<PAGE>
                                                                   Exhibit 10.26

                                                        FHLMC Loan No. 002682478

                                MULTIFAMILY NOTE

                                (NORTH CAROLINA)

US $7,372,000.00                                          As of May 8, 2000


      FOR VALUE RECEIVED, the undersigned ("Borrower") jointly and severally (if
more  than  one)  promises  to pay to the  order  of  GMAC  COMMERCIAL  MORTGAGE
CORPORATION, a California corporation,  the principal sum of Seven Million Three
Hundred  Seventy-Two  Thousand  and  00/100  Dollars  (US  $7,372,000.00),  with
interest  on the unpaid  principal  balance at the annual  rate of eight and one
hundred fifty thousandths percent (8.150%).

1.   Defined Terms. As used in this Note, (i) the term "Lender" means the holder
     of this Note,  and (ii) the term  "Indebtedness"  means the  principal  of,
     interest  on, or any other  amounts due at any time under,  this Note,  the
     Security  Instrument  or any  other  Loan  Document,  including  prepayment
     premiums,  late  charges,  default  interest,  and  advances to protect the
     security  of the  Security  Instrument  under  Section  12 of the  Security
     Instrument.  "Event of Default"  and other  capitalized  terms used but not
     defined  in this Note shall  have the  meanings  given to such terms in the
     Security Instrument.

2.   Address for  Payment.  All payments due under this Note shall be payable at
     650 Dresher Road, P.O. Box 1015, Horsham,  Pennsylvania  19044-8015,  Attn:
     Servicing - Account  Manager,  or such other place as may be  designated by
     written notice to Borrower from or on behalf of Lender.

3.   Payment of Principal and Interest.  Principal and interest shall be paid as
     follows:

(a) Unless  disbursement of principal is made by Lender to Borrower on the first
day of the month,  interest for the period beginning on the date of disbursement
and ending on and including the last day of the month in which such disbursement
is made  shall be  payable  simultaneously  with  the  execution  of this  Note.
Interest  under  this Note  shall be  computed  on the  basis of a 360-day  year
consisting of twelve 30-day months.

(b)  Consecutive  monthly  installments  of principal and interest,  each in the
amount of Sixty Two  Thousand  Three  Hundred  Fifty Two and 34/100  Dollars (US
$62,352.34),  shall be payable on the first day of each month  beginning on July
1, 2000,  until the entire unpaid  principal  balance  evidenced by this Note is
fully paid. Any accrued interest remaining past due for 30 days or more shall be
added to and become part of the unpaid principal balance and shall bear interest
at the rate or rates specified in this Note, and any reference below to "accrued
interest"  shall  refer to accrued  interest  which has not  become  part of the
unpaid principal balance.  Any remaining principal and interest shall be due and
payable on June 1, 2020 or on any  earlier  date on which the  unpaid  principal
balance of this Note becomes due and payable,  by acceleration or otherwise (the
"Maturity  Date").  The unpaid principal balance shall continue to bear interest
after the  Maturity  Date at the  Default  Rate set forth in this Note until and
including the date on which it is paid in full.

(c) Any regularly  scheduled monthly  installment of principal and interest that
is  received  by Lender  before  the date it is due shall be deemed to have been
received on the due date solely for the purpose of calculating interest due.

4.  Application of Payments.  If at any time Lender  receives,  from Borrower or
otherwise,  any amount  applicable  to the  Indebtedness  which is less than all
amounts due and payable at such time,  Lender may apply that  payment to amounts
then due and  payable in any manner and in any order  determined  by Lender,  in
Lender's  discretion.  Borrower  agrees that neither  Lender's  acceptance  of a
payment  from  Borrower in an amount that is less than all amounts  then due and
payable nor Lender's  application of such payment shall  constitute or be deemed
to  constitute  either  a  waiver  of  the  unpaid  amounts  or  an  accord  and
satisfaction.

5. Security.  The Indebtedness is secured,  among other things, by a multifamily
mortgage, deed to secure debt or deed of trust dated as of the date of this Note
(the "Security  Instrument"),  and reference is made to the Security  Instrument
for other rights of Lender as to collateral for the Indebtedness.

6.  Acceleration.  If an Event of Default has  occurred and is  continuing,  the
entire unpaid principal  balance,  any accrued interest,  the prepayment premium
payable under  Paragraph  10, if any, and all other  amounts  payable under this
Note and any other Loan  Document  shall at once become due and payable,  at the
option of Lender, without any prior notice to Borrower. Lender may exercise this
option to accelerate regardless of any prior forbearance.

7. Late  Charge.  If any  monthly  amount  payable  under this Note or under the
Security  Instrument or any other Loan Document is not received by Lender within
15 days after the amount is due,  Borrower shall pay to Lender,  immediately and
without  demand by Lender,  a late  charge  equal to five  percent  (5%) of such
amount.  Borrower  acknowledges  that its failure to make timely  payments  will
cause Lender to incur  additional  expenses in servicing and processing the loan
evidenced  by this Note (the  "Loan"),  and that it is extremely  difficult  and
impractical to determine  those  additional  expenses.  Borrower agrees that the
late charge payable pursuant to this Paragraph  represents a fair and reasonable
estimate,  taking into  account all  circumstances  existing on the date of this
Note,  of the  additional  expenses  Lender  will  incur by  reason of such late
payment.  The late  charge is  payable in  addition  to, and not in lieu of, any
interest payable at the Default Rate pursuant to Paragraph 8.

8. Default Rate. So long as (a) any monthly  installment under this Note remains
past due for 30 days or more, or (b) any other Event of Default has occurred and
is  continuing,  interest  under this Note shall accrue on the unpaid  principal
balance from the earlier of the due date of the first unpaid monthly installment
or the occurrence of such other Event of Default, as applicable,  at a rate (the
"Default Rate") equal to the lesser of 4 percentage points above the rate stated
in the first  paragraph of this Note or the maximum  interest  rate which may be
collected from Borrower under  applicable law. If the unpaid  principal  balance
and all accrued  interest are not paid in full on the Maturity  Date, the unpaid
principal balance and all accrued interest shall bear interest from the Maturity
Date at the Default Rate.  Borrower also  acknowledges  that its failure to make
timely payments will cause Lender to incur additional  expenses in servicing and
processing the Loan, that,  during the time that any monthly  installment  under
this Note is  delinquent  for more than 30 days,  Lender  will incur  additional
costs and  expenses  arising  from its loss of the use of the money due and from
the adverse impact on Lender's ability to meet its other obligations and to take
advantage of other investment opportunities,  and that it is extremely difficult
and impractical to determine those additional costs and expenses.  Borrower also
acknowledges that, during the time that any monthly  installment under this Note
is  delinquent  for more than 30 days or any other Event of Default has occurred
and is  continuing,  Lender's risk of nonpayment of this Note will be materially
increased  and Lender is entitled to be  compensated  for such  increased  risk.
Borrower  agrees that the  increase in the rate of interest  payable  under this
Note to the Default Rate represents a fair and reasonable estimate,  taking into
account all  circumstances  existing on the date of this Note, of the additional
costs and  expenses  Lender  will incur by reason of the  Borrower's  delinquent
payment and the  additional  compensation  Lender is entitled to receive for the
increased risks of nonpayment associated with a delinquent loan.

9.    Limits on Personal Liability.

(a) Except as otherwise  provided in this  Paragraph 9,  Borrower  shall have no
personal  liability  under this Note, the Security  Instrument or any other Loan
Document for the repayment of the  Indebtedness  or for the  performance  of any
other  obligations  of Borrower  under the Loan  Documents,  and  Lender's  only
recourse for the  satisfaction of the  Indebtedness  and the performance of such
obligations  shall be Lender's  exercise of its rights and remedies with respect
to the Mortgaged  Property and any other  collateral  held by Lender as security
for the Indebtedness. This limitation on Borrower's liability shall not limit or
impair  Lender's  enforcement  of  its  rights  against  any  guarantor  of  the
Indebtedness or any guarantor of any obligations of Borrower.

(b) Borrower shall be personally liable to Lender for the repayment of a portion
of the Indebtedness  equal to Zero percent (0%) of the unpaid principal  balance
of this Note,  plus any other amounts for which Borrower has personal  liability
under this Paragraph 9.

(c) In addition to Borrower's  personal liability under Paragraph 9(b), Borrower
shall be personally  liable to Lender for the repayment of a further  portion of
the  Indebtedness  equal to any loss or damage suffered by Lender as a result of
(1) failure of  Borrower to pay to Lender upon demand  after an Event of Default
all  Rents to which  Lender  is  entitled  under  Section  3(a) of the  Security
Instrument  and the amount of all security  deposits  collected by Borrower from
tenants  then in  residence;  (2)  failure of  Borrower  to apply all  insurance
proceeds and condemnation  proceeds as required by the Security  Instrument;  or
(3)  failure of Borrower to comply  with  Section  14(d) or (e) of the  Security
Instrument relating to the delivery of books and records, statements,  schedules
and reports.

(d) For purposes of determining  Borrower's  personal  liability under Paragraph
9(b) and Paragraph  9(c), all payments made by Borrower or any guarantor of this
Note with respect to the  Indebtedness  and all amounts  received by Lender from
the  enforcement  of its rights under the Security  Instrument  shall be applied
first to the  portion of the  Indebtedness  for which  Borrower  has no personal
liability.

(e) Borrower shall become  personally  liable to Lender for the repayment of all
of the  Indebtedness  upon the  occurrence  of any of the  following  Events  of
Default: (1) Borrower's acquisition of any property or operation of any business
not  permitted  by  Section  33 of  the  Security  Instrument;  (2)  a  Transfer
(including,  but not  limited  to,  a lien or  encumbrance)  that is an Event of
Default  under  Section  21 of the  Security  Instrument,  other than a Transfer
consisting  solely of the  involuntary  removal or  involuntary  withdrawal of a
general  partner in a limited  partnership  or a manager in a limited  liability
company; or (3) fraud or written material  misrepresentation  by Borrower or any
officer,  director,  partner,  member or employee of Borrower in connection with
the  application  for or  creation  of the  Indebtedness  or any request for any
action or consent by Lender.

(f) In addition to any personal  liability for the Indebtedness,  Borrower shall
be  personally  liable to Lender for (1) the  performance  of all of  Borrower's
obligations   under  Section  18  of  the  Security   Instrument   (relating  to
environmental  matters);  (2) the costs of any audit under  Section 14(d) of the
Security  Instrument;  and (3) any  costs  and  expenses  incurred  by Lender in
connection  with the  collection of any amount for which  Borrower is personally
liable  under  this  Paragraph  9,  including  reasonable  attorneys'  fees  and
expenses,  fees and out-of-pocket  expenses of expert witnesses and the costs of
conducting any  independent  audit of Borrower's  books and records to determine
the amount for which Borrower has personal liability.

(g) To the extent that Borrower has personal  liability  under this Paragraph 9,
Lender may exercise its rights  against  Borrower  personally  without regard to
whether  Lender has exercised any rights  against the Mortgaged  Property or any
other  security,  or pursued any rights  against any  guarantor,  or pursued any
other rights available to Lender under this Note, the Security  Instrument,  any
other Loan  Document or  applicable  law. For purposes of this  Paragraph 9, the
term "Mortgaged Property" shall not include any funds that (1) have been applied
by Borrower as required or  permitted by the  Security  Instrument  prior to the
occurrence  of an  Event of  Default  or (2)  Borrower  was  unable  to apply as
required  or  permitted  by the  Security  Instrument  because of a  bankruptcy,
receivership, or similar judicial proceeding.

10.   Voluntary and Involuntary Prepayments.

(a) A prepayment premium shall be payable in connection with any prepayment made
under this Note as provided below:

(1) Borrower may voluntarily  prepay all of the unpaid principal balance of this
Note on the last  Business Day of a calendar  month if Borrower has given Lender
at least 30 days prior  notice of its  intention to make such  prepayment.  Such
prepayment  shall be made by paying (A) the amount of principal  being  prepaid,
(B) all  accrued  interest,  (C) all other  sums due  Lender at the time of such
prepayment,  and (D) the prepayment premium  calculated  pursuant to Schedule A.
For all purposes including the accrual of interest,  any prepayment  received by
Lender on any day other than the last  calendar day of the month shall be deemed
to have been  received on the last  calendar day of such month.  For purposes of
this Note, a "Business  Day" means any day other than a Saturday,  Sunday or any
other day on which Lender is not open for business.  Borrower shall not have the
option to voluntarily prepay less than all of the unpaid principal balance.

(2) Upon  Lender's  exercise  of any  right of  acceleration  under  this  Note,
Borrower shall pay to Lender, in addition to the entire unpaid principal balance
of this  Note  outstanding  at the  time of the  acceleration,  (A) all  accrued
interest  and  all  other  sums  due  Lender,  and (B)  the  prepayment  premium
calculated pursuant to Schedule A.

(3) Any  application  by  Lender  of any  collateral  or other  security  to the
repayment of any portion of the unpaid  principal  balance of this Note prior to
the  Maturity  Date and in the absence of  acceleration  shall be deemed to be a
partial prepayment by Borrower, requiring the payment to Lender by Borrower of a
prepayment premium.  The amount of any such partial prepayment shall be computed
so as to provide to Lender a prepayment  premium computed pursuant to Schedule A
without Borrower having to pay out-of-pocket any additional amounts.

(b)  Notwithstanding  the provisions of Paragraph  10(a), no prepayment  premium
shall be payable with respect to (A) any  prepayment  made no more than 180 days
before the Maturity  Date,  or (B) any  prepayment  occurring as a result of the
application of any insurance  proceeds or condemnation  award under the Security
Instrument.

(c)   Schedule A is hereby incorporated by reference into this Note.

(d) Any  permitted  or  required  prepayment  of less than the unpaid  principal
balance of this Note shall not extend or postpone the due date of any subsequent
monthly  installments or change the amount of such  installments,  unless Lender
agrees otherwise in writing.

(e) Borrower  recognizes that any prepayment of the unpaid principal  balance of
this Note,  whether  voluntary or  involuntary  or  resulting  from a default by
Borrower,  will result in Lender's incurring loss, including  reinvestment loss,
additional expense and frustration or impairment of Lender's ability to meet its
commitments  to third  parties.  Borrower  agrees to pay to Lender  upon  demand
damages  for the  detriment  caused by any  prepayment,  and  agrees  that it is
extremely  difficult  and  impractical  to ascertain the extent of such damages.
Borrower  therefore  acknowledges  and agrees that the  formula for  calculating
prepayment  premiums set forth on Schedule A represents a reasonable estimate of
the damages Lender will incur because of a prepayment.

(f) Borrower further acknowledges that the prepayment premium provisions of this
Note are a material part of the  consideration  for the Loan,  and  acknowledges
that the terms of this Note are in other  respects more favorable to Borrower as
a  result  of the  Borrower's  voluntary  agreement  to the  prepayment  premium
provisions.

11. Costs and  Expenses.  Borrower  shall pay all expenses and costs,  including
reasonable  attorneys'  fees and expenses,  fees and  out-of-pocket  expenses of
expert witnesses and costs of  investigation,  incurred by Lender as a result of
any default under this Note or in connection  with efforts to collect any amount
due under  this  Note,  or to enforce  the  provisions  of any of the other Loan
Documents,  including those incurred in post-judgment  collection efforts and in
any  bankruptcy  proceeding  (including any action for relief from the automatic
stay of any  bankruptcy  proceeding)  or  judicial or  non-judicial  foreclosure
proceeding.

12.  Forbearance.  Any  forbearance  by Lender in exercising any right or remedy
under  this  Note,  the  Security  Instrument,  or any other  Loan  Document  or
otherwise  afforded by applicable  law, shall not be a waiver of or preclude the
exercise of that or any other right or remedy.  The  acceptance by Lender of any
payment after the due date of such  payment,  or in an amount which is less than
the required payment,  shall not be a waiver of Lender's right to require prompt
payment  when due of all other  payments or to exercise any right or remedy with
respect to any  failure to make  prompt  payment.  Enforcement  by Lender of any
security for  Borrower's  obligations  under this Note shall not  constitute  an
election by Lender of remedies so as to preclude the exercise of any other right
or remedy available to Lender.

13.  Waivers.  Presentment,  demand,  notice  of  dishonor,  protest,  notice of
acceleration,  notice of intent to demand or  accelerate  payment  or  maturity,
presentment  for  payment,  notice  of  nonpayment,   grace,  and  diligence  in
collecting  the  Indebtedness  are  waived by  Borrower  and all  endorsers  and
guarantors of this Note and all other third party obligors.

14. Loan Charges. If any applicable law limiting the amount of interest or other
charges  permitted to be collected from Borrower in connection  with the Loan is
interpreted  so that any  interest  or  other  charge  provided  for in any Loan
Document,  whether considered separately or together with other charges provided
for in any other Loan  Document,  violates that law, and Borrower is entitled to
the benefit of that law, that interest or charge is hereby reduced to the extent
necessary to eliminate that violation.  The amounts,  if any, previously paid to
Lender in excess of the  permitted  amounts shall be applied by Lender to reduce
the  unpaid  principal  balance  of this Note.  For the  purpose of  determining
whether any  applicable  law  limiting  the amount of interest or other  charges
permitted to be collected from Borrower has been violated, all Indebtedness that
constitutes  interest,  as well as all other charges made in connection with the
Indebtedness  that  constitute  interest,  shall be deemed to be  allocated  and
spread ratably over the stated term of the Note.  Unless  otherwise  required by
applicable law, such allocation and spreading shall be effected in such a manner
that the rate of interest so computed is uniform  throughout  the stated term of
the Note.

15.  Commercial  Purpose.  Borrower  represents  that the  Indebtedness is being
incurred  by  Borrower  solely for the  purpose  of  carrying  on a business  or
commercial enterprise, and not for personal, family or household purposes.

16.  Counting  of  Days.  Except  where  otherwise  specifically  provided,  any
reference in this Note to a period of "days" means  calendar  days, not Business
Days.

17. Governing Law. This Note shall be governed by the law of the jurisdiction in
which the Land is located.

18.  Captions.  The captions of the paragraphs of this Note are for  convenience
only and shall be disregarded in construing this Note.

19. Notices. All notices, demands and other communications required or permitted
to be given by  Lender  to  Borrower  pursuant  to this  Note  shall be given in
accordance with Section 31 of the Security Instrument.

20. Consent to  Jurisdiction  and Venue.  Borrower  agrees that any  controversy
arising under or in relation to this Note shall be litigated  exclusively in the
jurisdiction  in which the Land is located (the  "Property  Jurisdiction").  The
state and federal  courts and  authorities  with  jurisdiction  in the  Property
Jurisdiction  shall have exclusive  jurisdiction  over all  controversies  which
shall arise under or in relation to this Note. Borrower  irrevocably consents to
service,  jurisdiction,  and venue of such  courts for any such  litigation  and
waives  any other  venue to which it might be  entitled  by virtue of  domicile,
habitual residence or otherwise.

21. WAIVER OF TRIAL BY JURY.  BORROWER AND LENDER EACH (A) AGREES NOT TO ELECT A
TRIAL  BY JURY  WITH  RESPECT  TO ANY  ISSUE  ARISING  OUT OF  THIS  NOTE OR THE
RELATIONSHIP BETWEEN THE PARTIES AS LENDER AND BORROWER THAT IS TRIABLE OF RIGHT
BY A JURY AND (B) WAIVES  ANY RIGHT TO TRIAL BY JURY WITH  RESPECT TO SUCH ISSUE
TO THE EXTENT THAT ANY SUCH RIGHT  EXISTS NOW OR IN THE  FUTURE.  THIS WAIVER OF
RIGHT  TO  TRIAL  BY JURY IS  SEPARATELY  GIVEN  BY EACH  PARTY,  KNOWINGLY  AND
VOLUNTARILY WITH THE BENEFIT OF COMPETENT LEGAL COUNSEL.

      ATTACHED SCHEDULES.  The following Schedules are attached to this Note:

             X         Schedule A    Prepayment Premium (required)

             X         Schedule B    Modifications to Multifamily Note

      IN WITNESS  WHEREOF,  Borrower has signed and delivered  this Note, or has
caused  this  Note  to  be  signed  and   delivered   by  its  duly   authorized
representative, as a sealed instrument.

                                    NATIONAL PROPERTY INVESTORS 8, A CALIFORNIA
                                       LIMITED PARTNERSHIP, a California limited
                                       partnership

                                    By:  NPI Equity Investments, Inc., a Florida
                                         corporation, its general partner



                                       By:
                                            Harry Alcock
                                            Executive Vice President

                                   13-3254885
                                   Borrower's Social Security/Employer ID Number

<PAGE>

PAY TO THE ORDER OF FEDERAL HOME LOAN
MORTGAGE  CORPORATION,  WITHOUT  RECOURSE,
THIS 8TH DAY OF MAY, 2000.

GMAC COMMERCIAL
MORTGAGE CORPORATION,
a California corporation



By:
   Donald W. Marshall
   Vice President

<PAGE>

                                   SCHEDULE A

                               PREPAYMENT PREMIUM

      Any prepayment  premium  payable under  Paragraph 10 of this Note shall be
computed as follows:

(a) If the prepayment is made between the date of this Note and the date that is
180 months after the first day of the first calendar month following the date of
this Note (the "Yield Maintenance Period"),  the prepayment premium shall be the
greater of:

            (i)   1.0% of the unpaid principal balance of this Note; or

            (ii)  the product obtained by multiplying:

                    (A)  the amount of principal being prepaid,

                         by

                    (B)  the excess (if any) of the  Monthly  Note Rate over the
                         Assumed

                         Reinvestment Rate,

                         by

                    (C)  the Present Value Factor.

               For purposes of  subparagraph  (ii),  the  following  definitions
               shall apply:

               Monthly Note Rate: one-twelfth (1/12) of the annual interest rate
               of the Note, expressed as a decimal calculated to five digits.

               Prepayment Date: in the case of a voluntary prepayment,  the date
               on which the  prepayment is made; in any other case,  the date on
               which  Lender  accelerates  the unpaid  principal  balance of the
               Note.

               Assumed  Reinvestment Rate:  one-twelfth (1/12) of the yield rate
               as of the date 5 Business Days before the Prepayment Date, on the
               9.250% U.S.  Treasury  Security due February 1, 2016, as reported
               in The Wall Street Journal,  expressed as a decimal calculated to
               five  digits.  In the  event  that no yield is  published  on the
               applicable  date for the Treasury  Security used to determine the
               Assumed  Reinvestment  Rate,  Lender,  in its  discretion,  shall
               select the non-callable  Treasury  Security  maturing in the same
               year as the  Treasury  Security  specified  above with the lowest
               yield  published in The Wall Street  Journal as of the applicable
               date. If the  publication  of such yield rates in The Wall Street
               Journal is  discontinued  for any reason,  Lender  shall select a
               security with a comparable rate and term to the Treasury Security
               used to determine the Assumed Reinvestment Rate. The selection of
               an alternate security pursuant to this Paragraph shall be made in
               Lender's discretion.

<PAGE>

               Present Value Factor:  the factor that discounts to present value
               the costs  resulting  to Lender from the  difference  in interest
               rates  during  the  months  remaining  in the  Yield  Maintenance
               Period, using the Assumed Reinvestment Rate as the discount rate,
               with monthly compounding, expressed numerically as follows:

                                    [OBJECT OMITTED]

            n = number of months remaining in Yield Maintenance Period

            ARR = Assumed Reinvestment Rate

(b) If the  prepayment  is made after the  expiration  of the Yield  Maintenance
Period but more than 180 days before the Maturity Date,  the prepayment  premium
shall be 1.0% of the unpaid principal balance of this Note.

<PAGE>

                                        SCHEDULE B

                        MODIFICATIONS TO MULTIFAMILY NOTE

1. The first  sentence of 8 of the Note  ("Default  Rate") is hereby deleted and
replaced with the following:

                  So long as (a) any monthly installment under this Note remains
            past due for more than  thirty  (30) days or (b) any other  event of
            Default has occurred  and is  continuing,  interest  under this Note
            shall accrue on the unpaid principal balance from the earlier of the
            due date of the first unpaid  monthly  installment or the occurrence
            of such  other  Event of  Default,  as  applicable,  at a rate  (the
            "Default Rate") equal to the lesser of (1) the maximum interest rate
            which may be collected from Borrower under applicable law or (2) the
            greater of (i) three  percent (3%) above the  Interest  Rate or (ii)
            four percent  (4.0%) above the  then-prevailing  Prime Rate. As used
            herein,  the term  "Prime  Rate"  shall  mean  the rate of  interest
            announced by The Wall Street Journal from time to time as the "Prime
            Rate".

2. Paragraph 9(c) of the Note is amended to add the following subparagraph (4):

            (4)  failure  by  Borrower  to pay the amount of the water and sewer
charges,  taxes,  fire,  hazard or other  insurance  premiums,  ground  rents in
accordance with the terms of the Security Instrument.