UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 10-Q



/X/QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES

EXCHANGE ACT OF 1934.

For the quarterly period ended June 30, 2004

or

/ /TRANSITION REPORT PERSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES

EXCHANGE ACT OF 1934

For the transition period from _______ to _______

Commission file number 0-17696



AMERICAN AFFORDABLE HOUSING II LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)



|Massachusetts                     | 04-2992309         
|--------------------------------- | -------------------
|(State or other jurisdiction      | (I.R.S. Employer   
|of incorporation or organization) | Identification No.)



One Boston Place, Suite 2100,

Boston, Massachusetts  02108(Address of principal executive offices)

617-624-8900

(Registrant's telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 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 | / /
|--- | --- |  | -- | ---

















AMERICAN AFFORDABLE HOUSING II LIMITED PARTNERSHIP



QUARTERLY REPORT ON FORM 10-QFOR THE QUARTER ENDED JUNE 30, 2004



TABLE OF CONTENTS











































































American Affordable Housing II Limited PartnershipBALANCE SHEETS



|                                  | June 30,
2004(Unaudited)                                                                                            | March 31,
2004(Audited)
|--------------------------------- | ------------------------------------------------------------------------------------------------------------------- | -----------------------
|                                  |                                                                                                                     |                        
|ASSETS                           
|                                  |                                                                                                                     |                        
|INVESTMENTS IN OPERATING          |                                                                                                                     |                        
|                                  | PARTNERSHIPS (Note D)                                                                                               | $     550,651          
|                                  |                                                                                                                     |                        
|Cash and cash equivalents         | 1,022,165                                                                                                           | 999,699                
|Other assets                      | 5,490                                                                                                               | -                      
|                                  |                                                                                                                     |                        
|                                  | $1,578,306                                                                                                          | $1,558,235             
|                                  |                                                                                                                     |                        
|                                 
|LIABILITIES AND PARTNERS' DEFICIT
|                                  |                                                                                                                     |                        
|LIABILITIES                       |                                                                                                                     |                        
|                                  |                                                                                                                     |                        
|Accounts payable affiliates       | $  6,820,474                                                                                                        | $ 6,720,590            
|                                  |                                                                                                                     |                        
|                                  | 6,820,474                                                                                                           | 6,720,590              
|                                  |                                                                                                                     |                        
|PARTNERS' DEFICIT                 |                                                                                                                     |                        
|                                  |                                                                                                                     |                        
|Limited Partners                  |                                                                                                                     |                        
|                                  | Units of limited partnership 
interest, $1,000 stated value per
unit; issued and outstanding,
26,501 units (Note A) | (4,959,841)            
|General Partners                  | (282,327)                                                                                                           | (281,529)              
|                                  |                                                                                                                     |                        
|                                  | (5,242,168)                                                                                                         | (5,162,355)            
|                                  |                                                                                                                     |                        
|                                  | $1,578,306                                                                                                          | $1,558,235             







The accompanying notes are an integral part of this statement























American Affordable Housing II Limited PartnershipSTATEMENTS OF OPERATIONS Three Months Ended June 30,
(Unaudited)



|                                                            | 2004                                | 2003         
|----------------------------------------------------------- | ----------------------------------- | -------------
|                                                            |                                     |              
|Income                                                      |                                     |              
|                                                            | Interest income                     | $       1,833
|                                                            | Other income                        | 3,666        
|                                                            | 5,499                               | 4,469        
|                                                            |                                     |              
|Share of income (loss) from Operating Partnerships (Note D) | 17,114*                             | (69,535)     
|                                                            |                                     |              
|Expenses                                                    |                                     |              
|                                                            | Professional fees                   | 7,800        
|                                                            | General and administrative expenses | 2,728        
|                                                            | Asset management fees (Note C)      | 91,898       
|                                                            | 102,426                             | 123,785      
|                                                            |                                     |              
|NET LOSS                                                    | $(79,813)                           | $(188,851)   
|                                                            |                                     |              
|Net loss allocated to general partners                      | $(798)                              | $(1,889)     
|                                                            |                                     |              
|Net loss allocated limited partners                         | $(79,015)                           | $(186,962)   
|                                                            |                                     |              
|Net loss per unit of limited partnership interest           | $(3)                                | $(7)         
|                                                            |                                     |              





* Includes a gain on sale of Operating Partnership of $25,000.



The accompanying notes are an integral part of this statement

























American Affordable Housing II Limited PartnershipSTATEMENTS OF CHANGES IN PARTNERS' DEFICIT
Three Months Ended June 30,
(Unaudited)



|                                 | Assignees    | GeneralPartner | Total       
|-------------------------------- | ------------ | -------------- | ------------
|                                 |              |                |             
|Partners' Deficit
 April 1, 2004 | $(4,880,826) | $(281,529)     | $(5,162,355)
|                                 |              |                |             
|                                 |              |                |             
|Net loss                         | (79,015)     | (798)          | (79,813)    
|                                 |              |                |             
|Partners' Deficit
June 30, 2004  | $(4,959,841) | $(282,327)     | $(5,242,168)
|                                 |              |                |             









The accompanying notes are an integral part of this statement











































American Affordable Housing II Limited PartnershipSTATEMENTS OF CASH FLOWSThree Months Ended June 30,
(Unaudited)



|                                      | 2004                                                | 2003                                             
|------------------------------------- | --------------------------------------------------- | -------------------------------------------------
|Cash flows from operating activities: |                                                     |                                                  
|                                      |                                                     |                                                  
|                                      | Net Loss                                            | $     (79,813)                                   
|                                      | Adjustments:                                        |                                                  
|                                      |                                                     | Distributions from Operating Partnerships        
|                                      |                                                     | Share of Loss from Operating Partnerships        
|                                      |                                                     | Changes in assets and liabilities:               
|                                      |                                                     | Decrease (Increase) in other assets              
|                                      |                                                     | Increase in accounts payable and accrued expenses
|                                      |                                                     |                                                  
|                                      | Net cash provided by (used in) operating activities | 22,466                                           
|                                      |                                                     |                                                  
|                                      | INCREASE (DECREASE) IN CASH                         | 22,466                                           
|                                      |                                                     |                                                  
|Cash and cash equivalents, beginning  | 999,699                                             | 925,288                                          
|                                      |                                                     |                                                  
|Cash and cash equivalents, ending     | $ 1,022,165                                         | $ 911,572                                        

The accompanying notes are an integral part of this statement





American Affordable Housing II Limited Partnership

NOTES TO FINANCIAL STATEMENTS
June 30, 2004
(Unaudited)

NOTE A - ORGANIZATION

American Affordable Housing II Limited Partnership ("Partnership") was formed under the laws of The Commonwealth of Massachusetts on May 13, 1987, for the purpose of acquiring, holding, and disposing of limited 
partnership interests in operating partnerships which were to acquire, develop, rehabilitate, operate and own newly constructed, existing or rehabilitated low-income apartment complexes. Effective as of June 1, 2001 there was a restructuring, and as a result, the Partnership's general partner was reorganized as follows.  The General Partner of the Partnership continues to be Boston Capital Associates Limited Partnership, a Massachusetts limited partnership.  The general partner of the General Partner is BCA Associates Limited Partnership, a Massachusetts limited partnership, whose sole general partner is C&M Management, Inc., a Massachusetts corporation and whose limited partners are Herbert F. Collins and John P. Manning.  Mr. Manning is the principal of Boston Capital Partners, Inc.

Pursuant to the Securities Act of 1933, the Partnership filed a Form S-11 Registration Statement with the Securities and Exchange Commission, effective December 21, 1987, which covered the offering (the "Public Offering") of the Partnership's units of limited partner interest, as well as the units of limited partner interest offered by American Affordable Housing I, III, IV, and V Limited Partnerships (together with the Partnership, the 
"Partnerships").  The Partnerships registered 50,000 units of limited partner interest at $1,000 each unit for sale to the public.  The Partnership sold 26,501 units of limited partner interest, representing $26,501,000 of capital contributions.

NOTE B - ACCOUNTING AND FINANCIAL REPORTING POLICIES

The condensed financial statements included herein as of June 30, 2004 and for the three months then ended have been prepared by the Registrant, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission.  The Registrant's accounting and financial reporting policies are in conformity with generally accepted accounting principles and include adjustments in interim periods considered necessary for a fair presentation of the results of operations.  All such adjustments are of a normal recurring nature. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations.  It is suggested that these condensed financial statements are read in conjunction with the financial statements and the notes thereto included in the Registrant's Annual Report Statement on Form 10-K.

The accompanying financial statements reflect the Partnership's results of operations for an interim period and are not necessarily indicative of the results of operations for the fiscal year ending March 31, 2004.







American Affordable Housing II Limited Partnership

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

June 30, 2004

(Unaudited)

NOTE C - RELATED PARTY TRANSACTIONS

An annual asset management fee based on 0.5 percent of the aggregate cost of all apartment complexes owned by the Operating Partnerships, has been accrued as payable to Boston Capital Asset Management Limited Partnership.   The annual asset management fee accrued for the quarters ended June 30, 2004 and 2003 was $99,756 and $105,465.  Total asset management fees accrued as of June 30, 2004 were $6,529,814.

During the quarters ended June 30, 2004 and 2003 affiliates of the General Partner did not advance any money to the Partnership to pay operating expenses of the Partnership, or to make advances and/or loans to Operating Partnerships.  Total advances for such costs at June 30, 2004 were $261,667.  These and any additional advances will be repaid, without interest, from available cash flow or the proceeds of sales or refinancing of the Partnership's interests in Operating Partnerships.

The Partnership also accrued certain affiliate administrative expenses including but not limited to travel, printing, salaries, postage, and overhead allocations.  The amounts accrued during the quarters ended June 30, 2004 and 2003 were $127 and $138, respectively.  Total accruals at June 30, 2004 were $28,995.



NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS

At June 30, 2004 and 2003, the Partnership had limited partnership equity interests in 43 and 47 Operating Partnerships, each of which owned an apartment complex.

Under the terms of the Partnership's investment in each Operating Partnership, the Partnership was required to make capital contributions to such Operating Partnerships.  These contributions were payable in installments 
upon each Operating Partnership achieving specified levels of construction and/or operations.  At June 30, 2004 and 2003, all such capital contributions had been paid to the Operating Partnerships.

The Partnership's fiscal year ends March 31st of each year, while all the Operating Partnerships' fiscal years are the calendar year. Pursuant to the provisions of each Operating Partnership Agreement, financial results for 
each of the Operating Partnerships are provided to the Partnership within 45 days after the close of each Operating Partnership's quarterly period.  Accordingly, the current financial results available for the Operating Partnerships are for the three months ended March 31, 2004.





























American Affordable Housing II Limited Partnership



NOTES TO FINANCIAL STATEMENTS

June 30, 2004
(Unaudited)

COMBINED SUMMARIZED STATEMENTS OF OPERATIONS

NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)

The unaudited combined statements of operations of the Operating

Partnerships for the Three Months ended March 31, 2004 and 2003 are as follows:



|                                                                              | 2004           | 2003          
|----------------------------------------------------------------------------- | -------------- | --------------
|                                                                              |                |               
|Revenues                                                                      |                |               
|Rental income                                                                 | $    2,474,018 | $    2,485,911
|Interest and other                                                            | 52,929         | 81,711        
|                                                                              |                |               
|                                                                              | 2,526,947      | 2,567,622     
|                                                                              |                |               
|Expenses                                                                      |                |               
|Interest expense                                                              | 664,268        | 655,019       
|Depreciation and amortization                                                 | 660,177        | 688,405       
|Operating expenses                                                            | 1,874,462      | 1,889,368     
|                                                                              | 3,198,907      | 3,232,792     
|                                                                              |                |               
|NET LOSS                                                                      | $(671,960)     | $(665,170)    
|                                                                              |                |               
|Net loss allocation to American
  Affordable Housing II Limited
  Partnership | $(7,886)       | $(69,535)     
|                                                                              |                |               
|                                                                              |                |               
|Net loss allocated to other 
  partners                                       | $(79)          | $(695)        
|                                                                              |                |               
|Net loss suspended                                                            | $(663,995)     | $(594,940)    



The Partnership accounts for its investments using the equity method of accounting.  Under the equity method of accounting, the partnership adjusts its investment cost for its share of each Operating Partnership's results of
operations and for any distributions received or accrued.  However, the Partnership recognizes individual operating losses only to the extent of capital contributions.  Excess losses are suspended for use in future years to 
offset excess income.



American Affordable Housing II Limited Partnership



NOTES TO FINANCIAL STATEMENTS (CONTINUED)

June 30, 2004

(Unaudited)

NOTE E - TAXABLE LOSS

The Partnerships taxable loss for the year ended December 31, 2004 is expected to differ from its loss for financial reporting purposes. This is primarily due to accounting differences in depreciation incurred by the Operating Partnerships and also differences between the equity method of accounting and IRS accounting methods. No provision or benefit for income taxes has been included in these financial statements since taxable income or loss passes through to, and is reportable by, the partners individually.



Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations

Liquidity

The Partnership's primary source of funds was the proceeds of its Public Offering.  Other sources of liquidity have included (i) interest earned on working capital reserves, and (ii) cash distributions from operations of the 
Operating Partnerships in which the Partnership has invested.  Both of these sources of liquidity are available to meet the obligations of the Partnership.

The Partnership is currently accruing the annual asset management fee. Asset management fees accrued during the quarter ended June 30, 2004 were $99,756 and $105,465, and total asset management fees accrued as of June 30, 2004 were $6,529,814. Pursuant to the Partnership Agreement, such liabilities will be deferred until the Partnership receives sales or refinancing proceeds from Operating Partnerships, which will be used to satisfy such liabilities.

The Partnership has recognized other income as of June 30, 2004 in the amount of $3,666.  This amount represents distributions from Operating Partnerships, which the Partnership normally would record as a decrease in the Investment in Operating Partnerships.  Due to the equity method of accounting, the Partnership has recorded these distributions as other income.

The Partnership has recorded $6,820,474 as payable to affiliates.  This represents advances to pay certain third party operating expenses of the Partnership, advances and/or loans to Operating Partnerships, accrued partnership management fees, and accrued overhead allocations.  These and any future advances or accruals will be paid, without interest, from available cash flow, reporting fees, or the proceeds of sales or refinancing of the Partnership's interest in Operating Partnerships.

Cash flow and reporting fees will be added to the Partnership's working capital and will be available to meet future third party obligations of the Partnership.  The Partnership is currently pursuing, and will continue to aggressively pursue, available cash flow and reporting fees and anticipates that the amount collected will be sufficient to cover future third party operating expenses.



Capital Resources

The Partnership received $26,501,000 in subscriptions for Units (at $1,000 per Unit) during the period February 2, 1988 to December 21, 1988 pursuant to the Public Offering, resulting in net proceeds available for investment in 
Operating Partnerships (after payment of acquisition fees and expenses and funding of a reserve) of $18,550,700.

As of June 30, 2004, the Partnership had committed to investments requiring cash payments of $18,613,793, all of which has been paid.  At June 30, 2004, the Partnership held $1,022,165, which is comprised of working capital and proceeds from the sale of 5 properties.  Since the Partnership has completed funding of all investments, it anticipates that there should be no significant need for capital resources in the future.

Results of Operations

As of June 30, 2004 and 2003 the Partnership held limited partnership interests in 43 and 47 Operating Partnerships. In each instance the Apartment Complex owned by the applicable Operating Partnership is eligible for the Federal Housing Tax Credit.  Initial occupancy of a unit in each Apartment Complex which complied with the Minimum Set-Aside Test (i.e., initial occupancy by tenants with incomes equal to no more than a certain percentage of area median income) and the Rent Restriction Test (i.e., gross rent charged tenants does not exceed 30% of the applicable income standards) is referred to hereinafter as "Qualified Occupancy."  Each of the Operating Partnerships and each of the respective Apartment Complexes are described more fully in the Prospectus or applicable report on Form 8-K.  The General Partner believes that there is adequate casualty insurance on the properties.

As of June 30, 2004 and 2003 the Qualified Occupancy of the Operating Partnership's was 100%, respectively.  The Partnership had a total of 43 properties at June 30, 2004, all of which were at 100% Qualified Occupancy.

The Partnership had invested in a total of 43 and 47 Operating Partnerships as of June 30, 2004 and 2003. During the quarters ended June 30, 2004 and 2003, the Partnership received $3,666 and $3,117, respectively, in distributions of cash flow and $7,858 and $9,824, respectively, of reporting fees from the Operating Partnerships.

The Partnership incurred an annual asset management fee to Boston Capital Asset Management Limited Partnership in an amount equal to 0.5% of the aggregate cost of the apartment complexes owned by the Operating Partnerships, less the amount of certain partnership management and reporting fees paid by the Operating Partnerships.  The annual asset management fee incurred, net of reporting fees received, during the quarters ended June 30, 2004 and 2003 was $91,898 and $95,641, respectively.

Liberty Center, Limited owned a 109-unit property (Liberty Center I) located in Jacksonville, FL (the "Property").  The Property is a single room occupancy facility with shared bath and kitchen facilities designed to serve homeless individuals.  The Property was subject to a Low Income Housing Tax Credit Compliance Period which ended December 31, 2003.  The Operating General Partner offered to purchase the Partnership's interest in the Property for $70,000.  After conducting an internal analysis of the Property's value and hiring an independent consultant to conduct an analysis of the Property's value, the Investment General Partner accepted the Operating General Partner's offer and on January 2, 2004, the sale was completed.  The Investment Partnership, its General Partner and various affiliates agreed to forego certain payables due upon the sale of its interest in the Property, and returned all sale proceeds generated by the sale to the Limited Partners of the Investment Partnership in July 2004. The amount distributed to the investors on a per unit basis was $26.41.
Washington Mews LP owned a 20-unit property (Washington Mews) located in Dorchester, Massachusetts (the "Property").  The Property was subject to a Low Income Housing Tax Credit Compliance Period which ended December 31, 2002.  In anticipation of the expiration of the Compliance Period, the Property was offered for sale through Coldwell Banker-Hunneman.  An offer to purchase the Property for $1,950,000 by an unrelated third party (the "Buyer") was received.  The Property was sold to the Buyer on January 3, 2003 and full consideration of $1,950,000 was received at that time.  The Investment Partnership's share of the total sale proceeds was $852,740.  
The Property was subject to a first mortgage loan from the Massachusetts Housing Partnership Fund (MHP).  Prior to the sale of the Property, a payoff letter was requested and issued by MHP (the "Payoff Letter").  At closing, funds were distributed to MHP in accordance with the Payoff Letter.  In addition, sale proceeds due to the Investment Partnership were distributed at closing.  Subsequent to the receipt of these funds, MHP refused to issue a discharge of the mortgage in accordance with the Payoff Letter.  The MHP mortgage provides for (under certain circumstances) the lender's participation in gain realized at sale over and above the mortgage amount.  A calculation of this participation was made and included in the Payoff Letter issued by MHP.  However, after payment of this amount, MHP indicated that it disagreed with the participation calculation and refused to issue a discharge of mortgage and to release certain funds belonging to Washington Mews and held in escrow by MHP.





MHP commenced litigation against Washington Mews and requested that the court hold the mortgage discharge until the litigation is resolved.  The court denied MHP's request, and in the first quarter 2004, MHP and Washington Mews reached an agreement regarding the participation payment.  The litigation has been dismissed, and the sale proceeds amount was finalized and distributed in July 2004.  Of the total sale proceeds received $592,006 or $223.39 per unit was returned to the investors.  The remaining proceeds total of $260,734 was paid to BCAMLP for fees and expenses related to the sale and partial reimbursement of amounts payable to affiliates. The breakdown of the amount to be paid to BCAMLP is as follows:  $54,472 represents reimbursement of expenses incurred related to sale, which includes but is not limited to due diligence, legal and mailing costs; $48,750 represents a fee for overseeing and managing the disposition of the property; and $157,492 represents a partial payment of outstanding Asset Management Fees due to BCAMLP.

Historically, the financial statements of Rouse Stokes Rowe Housing Associates, L.P. (Stokes Rowe Apartments) have been prepared assuming that the Operating Partnership would continue as a going concern.  In the past the property has always experienced high occupancy but has never been able to support operations due to excessive operating expenses.  During the fourth quarter of 2002 average occupancy decreased to 75%, and remained at 75% through the fourth quarter of 2003.  Both of the Operating Partnership's mortgages remain in technical default for non-payment.  The first permanent loan is payable to the stockholder of Southwark Realty, an affiliate of the Operating General Partner.  It was noted in a site visit in 2001 that the property had a number of tenant files that were not in compliance due to improper documentation.  In addition, the State Agency issued Low Income Housing Credit Agencies Report of Noncompliance forms 8823's for failing to file the required Annual Owner's Certifications. The tax credit compliance period ended on December 31, 2002.  The Investment General Partner continues negotiations to sell the Operating Partnership interest to the Operating General Partner and has tentatively reached an agreement. Closing documents are anticipated to be finalized during the third quarter of 2004.

Lovington Housing Associates L.P. (Southview Place Apartments) is a 48 unit property located in Lovington, New Mexico which is in its final year of compliance. In 2003, the property accrued asset, partnership, and management fees totaling $5,354. Though the 2003 audit indicated that the property generated cash of $4,344, it was due to under-funding of the replacement reserve account and accrued fees.  If the required replacement reserve deposits were made, the Debt Coverage Ratio would have been reduced to 0.96 from the actual 1.29.  The management company's marketing efforts continue to be successful in increasing occupancy in 2004.  As of July 2004, the occupancy was up to 96% from the 2003 average of 91%.  An insurance claim has been submitted to repair the roof and steps have been taken to obtain a rehab loan in order to make some badly needed capital improvements.  With the current strong occupancy and a loan to cover capital improvements, the property will operate above breakeven and be able to start paying down accrued fees and payables. The property's mortgage, taxes and insurance payments are current.



The liquidity of the Harbor Hill Associates Limited Partnership (Harbor Hill Estates) has been adversely affected by recurring losses from operations.  The operating deficits have prevented the Operating Partnership from meeting obligations as they become due and from making required deposits into the replacement reserve account.  The Operating Partnership received a service letter (mortgage default notice) from USDA/RD on January 3, 2001.  A workout plan to address these issues was approved by USDA/RD in December 2001.  The Operating General Partner is in compliance with the terms of the workout plan, and the workout plan appears to be helping with the turn around of the property.  USDA/RD has allowed the property to admit non-elderly tenants that are income qualified due to a change in the demographics of the marketplace of Bar Harbor, ME. Consequently, occupancy has stabilized at 92%. The increased occupancy has helped stabilize the property's operations. Although the property continues to operate below breakeven, the Operating General Partner is making advances as required by the workout plan. The Investment General Partner will continue to monitor this situation very closely.

Kingsley Park Associates Limited Partnership (Kingsley Park Apartments) is a 312-unit project located in Essex, Maryland.  The Investment General Partner received $25,000 from the Operating General Partner as payment for its interest in the Operating Partnership.  Allocation of the sale proceeds will be determined when the sale price has been finalized and the amended partnership agreement has been signed and executed by the Operating General Partner.
Riverplace Apartments, is a 100 unit community located in Holyoke MA. The property has debt coverage ratio of 1.14, below average operating expenses, and average occupancy of 97% as of June 30, 2004.  The Operating Partnership was involved in a dispute with the City of Holyoke related to water meter readings and sewer use charges at the property.  The City claimed that the meter had not been working properly and the city subsequently billed the Operating Partnership $83,000.  The Operating Partnership contested the charges and on June 6,1995 the City placed a lien on the property for the unpaid water and sewer use plus accumulated interest totaling $94,503. A settlement has recently been reached with the City under which the Operating Partnership paid $50,000 to settle the dispute to the Department of Public Works. 
Lake Havasu Investment Group (Anacapa Apartments) is a 40-unit family property located in Lake Havasu, AZ.  Despite an average occupancy of 92%, the property operated below breakeven in 2003 due to high operating expenses.  As a result, accounts payable increased and escrow accounts were underfunded.  Occupancy averaged 97.66% for the first half of 2004.  The rental increase that was awarded to the property in January 2004 is allowing the property to generate cash, reduce payables, and fund the under funded escrow accounts.  The Investment General Partner will continue to monitor this property for the next few months to ensure the operations are stabilized.  Management is working with Rural Development to develop a workout agreement.

The Operating General Partner of Carthage Court Housing Company (Champion Apartments II) negotiated a sale of his General Partner interest.  As the tax credit compliance period has expired, the Investment General Partner negotiated an agreement with the new Operating General Partner to sell the Investment Limited Partner interest.  This transaction was finalized in August 2003, and proceeds payable to the Investment Partnership of $19,091.06 were received September 9, 2003.  Of the total proceeds received, $10,000 or $.38 per unit was returned to the Limited Partners in July 2004.  The balance of $9,091.06 was used to paydown accrued asset management fees.
The Operating General Partner of Malone Housing Redevelopment Company (Maple Ridge Apartments) negotiated a sale of his General Partner interest.  As the Operating Partnership tax credit compliance period has expired the Investment General Partner negotiated an agreement with the new Operating General Partner to sell the Investment Limited Partner interest.  This transaction was finalized in August 2003, and proceeds payable to the Investment Partnership of $23,863.83 were received on September 9, 2003.  .  Of the total proceeds received, $10,000 or $.38 per unit was returned to the Limited Partners in July 2004.  The balance of $13,863.83 was used to paydown accrued asset management fees.





Nebraska City Senior, A Limited Partnership, (Southside Estates) is a 15-unit elderly housing complex located in Nebraska City, Nebraska.       As of June 30, 2004, physical occupancy is 87%.  Management has been having trouble attracting qualified tenants because most of the qualified tenants in the area have been moving to Lincoln, which has better geriatric care.  To improve occupancy  management is considering lowering the property's age limit from 62 to 55.  The property's mortgage taxes and insurance are current.

Garden City Family Housing, (Harvest View Apartments), a 16-unit property located in Garden City, Missouri, had an average occupancy of 82% for the first six months of 2004.  Occupancy has suffered because only 12 of the 16 units have rental assistance and the unsubsidized units together with the increased maintenance and capital needs of the property have made it difficult to attract applicants.  Management has petitioned Rural Development for rental assistance on the remaining four units and continues to market the property through newspapers and local civic agencies.  Management is in the process of offering rental incentives.  Management is carefully monitoring expenses and the mortgage, taxes and insurance are all current.















































































Principal Accounting Policies and Estimates

The financial statements are prepared in accordance with accounting principles generally accepted in the United States of America, which requires the Partnership to make certain estimates and assumptions.  A summary of significant accounting policies is provided in Note 1 to the financial statements.  The following section is a summary of certain aspects of those accounting policies that may require subjective or complex judgments and are most important to the portrayal of Partnership's financial condition and results of operations.  The Partnership believes that there is a low probability that the use of different estimates or assumptions in making these judgments would result in materially different amounts being reported in the financial statements.

The Partnership is required to assess potential impairments to its long-lived assets, which is primarily investments in limited partnerships.  The Partnership accounts for its investment in limited partnerships in accordance with the equity method of accounting since the Partnership does not control the operations of the Operating Limited Partnership.

If the book value of the Partnership's investment in an Operating Partnership exceeds the estimated value derived by management, which generally consists of the remaining future Low-Income Housing Credits allocable to the Partnership and the estimated residual value to the Partnership, the Partnership reduces its investment in any such Operating Limited Partnership and includes such reduction in equity in loss of investment of limited partnerships.





|Item 3 | Quantitative and Qualitative Disclosure About Market Risk
|------ | ---------------------------------------------------------
|       |                                                          
|       | Not Applicable                                           



|Item 4 | Controls & Procedures
|------ | ---------------------
|       |                      
|       | (a)                  
|       |                      
|       |                      
|       | (b)                  
|       |                      





PART II - OTHER INFORMATION



|Item 1. | Legal Proceedings                                                                
|------- | ---------------------------------------------------------------------------------
|        |                                                                                  
|        | None                                                                             
|        |                                                                                  
|Item 2. | Changes in Securities, Use of Proceeds, and Issuer Purchases of Equity Securities
|        |                                                                                  
|        | None                                                                             
|        |                                                                                  
|Item 3. | Defaults upon Senior Securities                                                  
|        |                                                                                  
|        | None                                                                             
|        |                                                                                  
|Item 4. | Submission of Matters to a Vote of Security 
Holders                             
|        |                                                                                  
|        | None                                                                             
|        |                                                                                  
|Item 5. | Other Information                                                                
|        |                                                                                  
|        | None                                                                             
|        |                                                                                  
|Item 6. | Exhibits and Reports on Form 8-K                                                 
|        |                                                                                  
|        | (a)Exhibits                                                                      
|        |                                                                                  
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|        |                                                                                  
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|        |                                                                                  
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|        | (b)Reports on Form 8-K                                                           
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SIGNATURES
Pursuant to the requirements of Section 13 of the Securities Exchange Act
of 1934, the Registrant has duly caused this Report to be signed on its behalf
by the undersigned, thereunto duly authorized.

|                      | American Affordable Housing II
|--------------------- | ------------------------------
|                      | Limited Partnership           
|                      |                               
|                      | By:                           
|                      |                               
|                      |                               
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|Date: August 19, 2004 |                               
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Pursuant to the requirements of the Securities Exchange Act of 1934, thisreport has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated:

|DATE            | SIGNATURE           | TITLE               
|--------------- | ------------------- | --------------------
|                |                     |                     
|August 19, 2004 | /s/ John P. Manning | Director, President 
|                | John P. Manning     | (Principal Executive
|                |                     | Officer), C&M       
|                |                     | Management Inc;     



|DATE            | SIGNATURE        | TITLE                                         
|--------------- | ---------------- | ----------------------------------------------
|                |                  |                                               
|August 19, 2004 | /s/ Marc N. Teal | Senior Vice President, Chief Financial Officer
|                | Marc N. Teal     | (Principal Accounting and Financial Officer)  
|                |                  | C&M Management Inc.