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 September 30, 1998

                                       OR

          [ ] transition report pursuant to section 13 or 15(d) of the
                         securities exchange act of 1934

      For the transition period from __________________ to ________________

                           Commission File No. 0-13556

          Cluster Housing Properties (A California Limited Partnership)
              (formerly Berry and Boyle Cluster Housing Properties)
             (Exact name of registrant as specified in its charter)

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

                  5110 Langdale Way, Colorado Springs CO 80906
--------------------------------------------------------------------------------
               (Address of principal executive offices) (Zip Code)

                                                  (719) 527-0544
--------------------------------------------------------------------------------

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: Units of Limited
 Partnership Interests

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by  Sections  13 and 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 ___




<PAGE>






















                          PART I. FINANCIAL INFORMATION

                          Item 1. FINANCIAL STATEMENTS


<PAGE>



                           CLUSTER HOUSING PROPERTIES
                       (a California Limited Partnership)
                                AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS

                                 ---------------
<TABLE>


                                           ASSETS

                                                           September 30,
                                                               1998           December 31,
                                                            (Unaudited)           1997
Assets held for sale/Property, at cost (Note 8)
<S>                                                        <C>                   <C>       
  Land                                                     $      -              $1,242,061
  Buildings and improvements                                      -               6,063,055
  Equipment, furnishings and fixtures                             -                 642,239
                                                          ----------------   ---------------

                                                                   -              7,947,355
  Less accumulated depreciation                                    -            (2,152,207)
                                                          ----------------   ---------------

                                                                   -              5,795,148

Cash and cash equivalents                                         315,161           421,580
Real estate tax escrows                                            -                 24,037
Deposits and prepaid expenses                                      -                133,285
Accounts receivable                                                -                  1,400
Deferred expenses, net of accumulated
  amortization of $213,035 and $205,147                             -                 7,888
                                                          ----------------   ---------------

         Total assets                                            $315,161        $6,383,338
                                                          ================   ===============

                                         LIABILITIES AND PARTNERS' EQUITY (DEFICIT)

Mortgage notes payable                                         $      -           $3,058,800
Accounts payable                                                   13,075            83,637
Accrued expenses                                                   20,863           131,588
Due to affiliates (Note                                            20,384            16,076
7)
Rents received in advance                                          -                  1,984
Tenant security deposits                                           -                 33,555
                                                          ----------------   ---------------

         Total liabilities                                         54,322         3,325,640


General Partners' deficit                                         (1,810)         (127,847)
Limited Partners' equity                                          262,650         3,185,545
                                                          ----------------   ---------------

        Total liabilities and partners' equity                   $315,161        $6,383,338
                                                          ================   ===============



<PAGE>



                           CLUSTER HOUSING PROPERTIES
                       (a California Limited Partnership)
                                AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                                  -------------

                                                    Three Months Ended                Nine Months Ended
                                                      September 30,                     September 30,
                                                 1998              1997          1998              1997
Revenue:
<S>                                            <C>                <C>             <C>             <C>       
   Rental income                               $   -              $612,106        $414,662        $1,895,970
   Interest income                                17,328             8,462          39,507            29,064
   Gain from sale of properties                    -                               452,214             -
                                         ----------------   ---------------  --------------   ---------------
                                                           
Total Revenue                                     17,328           620,568         906,383         1,925,034

Expenses:
   Operations                                                      372,008         182,661           955,597
   Interest expense                                                200,837         117,384           590,019
   Depreciation and amortization                                   117,228           7,888           332,789
   General and administrative                     47,710            54,437         153,208           170,579

                                         ----------------   ---------------   --------------   ---------------
Total Expenses                                    47,710           744,510         461,141         2,048,984
                                         ----------------   ---------------  --------------   ---------------

Net income (loss)                              ($30,382)        ($123,942)        $445,242        ($123,950)
                                         ==================================  ==============   ===============

Net income (loss) allocated to:
  General Partners                                ($304)          ($1,239)        $126,037          ($1,240)

  Basic and diluted per unit Net income  (loss)  allocated  to Investor  Limited
    Partner interest:
       32,421 units issued                       ($0.93)           ($3.78)           $9.85           ($3.78)



<PAGE>



                           CLUSTER HOUSING PROPERTIES
                       (a California Limited Partnership)
                                AND SUBSIDIARIES

              CONSOLIDATED STATEMENTS OF PARTNERS' EQUITY (DEFICIT)

                                  -------------


                                                                Investor           Total
                                                General         Limited          Partners'
                                                Partners        Partners           Equity

<S>                                              <C>             <C>               <C>       
Balance at December 31, 1996                     ($192,294)      $6,896,994        $6,704,700

Cash distributions                                 (15,358)     (5,641,254)       (5,656,612)

Net loss                                             79,805       1,929,805         2,009,610
                                             --------------- ---------------   ---------------

Balance at December 31, 1997                      (127,847)       3,185,545         3,057,698

Cash distributions                                 -            (3,242,100)       (3,242,100)

Net income                                          126,037         319,205           445,242
                                             --------------- ---------------   ---------------

Balance at September 30, 1998                      ($1,810)        $262,650          $260,839
                                             =============== ===============   ===============







<PAGE>




                           CLUSTER HOUSING PROPERTIES
                       (a California Limited Partnership)
                                AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS


                                                                  Nine Months Ended
                                                                     September 30,
Cash flows from operating activities:                            1998             1997
                                                                 ----             ----
<S>                                                                <C>              <C>    
  Interest received                                                $39,507          $29,064
  Cash received from rental income                                 379,123        1,900,718
  General and administrative expenses                            (158,136)        (203,874)
  Operations expense                                             (317,106)        (872,010)
  Interest paid                                                  (129,014)        (591,194)
                                                            ---------------  ---------------
Net cash provided by operating activities                        (185,626)          262,704

Cash flows from investing activities:
  Proceeds from sale of properties                               6,608,653
  Capital improvements                                           (361,293)        (235,094)
  Deposit with escrow agent                                        131,413         -
                                                            ---------------  ---------------

Net cash provided by investing activities                        6,378,773        (235,094)

Cash flows from financing activities:
  Distributions to partners                                    (3,242,100)        (291,789)
  Deposits                                                           1,335         -
  Principal payments on mortgage notes payable                 (3,058,800)        (109,899)
                                                            ---------------  ---------------

Net cash used by financing activities                          (6,299,565)        (401,688)
                                                            ---------------  ---------------

Net increase (decrease) in cash and cash equivalents             (106,419)        (374,078)

Cash and cash equivalents at beginning of  the period              421,580        1,065,855
                                                            ---------------  ---------------

Cash and cash equivalents at end of the period                    $315,161         $691,777
                                                            ===============  ===============






<PAGE>




                           CLUSTER HOUSING PROPERTIES
                       (a California Limited Partnership)
                                AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS


                                  -------------


Reconciliation   of  net  income  (loss)  to  net  cash  provided  by  operating
activities:
                                                                                Nine Months Ended
                                                                                    September 30,
                                                                                1998             1997
                                                                                ----             ----
<S>                                                                              <C>            <C>       
Net income (loss)                                                                $445,242       ($123,950)

Adjustments to  reconcile  net income  (loss) to net cash  provided by operating
  activities:
  Depreciation and amortization                                                     7,888          332,789
  Gain from sale of property                                                     (452,214)
Change in assets  and  liabilities  net of effects of  investing  and  financing
activities:
    Decrease (increase) in real estate tax escrows                                 24,037         (14,035)
    Decrease (increase) prepaid expenses                                              537          (1,175)
    Decrease in accounts receivable                                                 1,400              962
    (Decrease) increase in accounts payable and accrued expenses                 (181,285)           66,910
    Increase (decrease) in due to affiliates                                        4,308          (3,545)
    Decrease in rent received in advance                                           (1,984)          (3,638)
    (Decrease) increase in tenant security deposits                               (33,555)            8,386
                                                                           ---------------  ---------------

Net cash provided by operating activities                                       ($185,626)         $262,704
                                                                           ===============  ===============


</TABLE>




<PAGE>


                           CLUSTER HOUSING PROPERTIES
                       (A California Limited Partnership)
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   ----------


                                                                 

1.  Organization of Partnership:

Cluster   Housing   Properties   (a   California   Limited   Partnership)   (the
"Partnership"),  formerly Berry and Boyle Cluster Housing Properties, was formed
on August  8,  1983.  The  Partnership  issued  all of the  General  Partnership
Interests  to three  General  Partners  in exchange  for  capital  contributions
aggregating  $2,000.  Stephen B. Boyle and GP L'Auberge  Communities,  L.P.,  (a
California Limited  Partnership),  formerly Berry and Boyle Management,  are the
General  Partners.  In  September,  1995,  with the consent of Limited  Partners
holding a  majority  of the  outstanding  Units,  as well as the  consent of the
mortgage  lenders  for the  Partnership's  three  properties,  Richard  G. Berry
resigned as a general partner of the Partnership.

A  total  of  2,000  individual   Limited  Partners  owning  32,421  units  have
contributed  $16,210,500 of capital to the  Partnership.  At September 30, 1998,
the total number of Limited  Partners was 1,902.  Except under  certain  limited
circumstances, as defined in the Partnership Agreement, the General Partners are
not required to make any additional capital contributions.  The General Partners
or their affiliates will receive various fees for services and reimbursement for
various organizational and selling costs incurred on behalf of the Partnership.

The Partnership will continue until December 31, 2010, unless terminated earlier
by the sale of all, or substantially  all, of the assets of the Partnership,  or
otherwise in accordance  with the  provisions  of Section 16 of the  Partnership
Agreement.  The Partnership has sold  substantially  all of the assets and is in
its final liquidation. Once all Partnership obligations have been satisfied, the
remaining  Partnership  funds,  if any, are anticipated to be distributed to the
Limited Partners. Such funds, if any, are expected to be modest in amount. It is
anticipated that the Partnership will be wound up in the first quarter of 1999.

2.  Significant Accounting Policies:

         A.  Basis of Presentation

         The  consolidated  financial  statements  include  the  accounts of the
         Partnership and its subsidiaries:  Sin Vacas Joint Venture (Sin Vacas),
         Autumn  Ridge Joint  Venture  (Autumn  Ridge) and Villa  Antigua  Joint
         Venture (Villa  Antigua).  All  intercompany  accounts and transactions
         have been  eliminated in  consolidation.  The  Partnership  follows the
         accrual basis of accounting.  Refer to Note 4 regarding the termination
         of the Joint  Ventures and the sale of Villas Sin Vacas,  Villa Antigua
         and Pinecliff.

         B.  Cash and Cash Equivalents

         The Partnership  considers all highly liquid debt instruments purchased
         with a maturity  of three  months or less to be cash  equivalents.  The
         carrying value of cash and cash equivalents approximates fair value. It
         is  the  Partnership's   policy  to  invest  cash  in  income-producing
         temporary cash  investments.  The  Partnership  mitigates any potential
         risk from such concentration of credit by placing investments with high
         quality financial institutions.

         C. Significant Risks and Uncertainties

         The  preparation of financial  statements in conformity  with generally
         accepted  accounting  principles  requires management to make estimates
         and  assumptions  that  affect  the  reported  amounts  of  assets  and
         liabilities and disclosure of contingent  assets and liabilities at the
         date of the financial  statements and the reported  amounts of revenues
         and expenses during the reporting  period.  Actual results could differ
         from those estimates.
2.  Significant Accounting Policies, continued:

         D.  Depreciation

         Depreciation  is provided  for by the use of the  straight-line  method
         over estimated useful lives as follows:

                  Buildings and improvements                        39-40 years
                  Equipment, furnishings and fixtures                5-15 years

         E.  Deferred Expenses

         Costs of obtaining or extending  mortgages on the  properties are being
         amortized over the mortgage term using the straight-line  method, which
         approximates the effective interest method. Fees paid to certain of the
         property  developers  were  amortized  over  the  term of the  services
         provided  using  the  straight-line   method.   Any  unamortized  costs
         remaining  at the date of a  refinancing  are  expensed  in the year of
         refinancing.

         F.  Income Taxes

         The Partnership is not liable for Federal or state income taxes because
         Partnership  income or loss is allocated to the Partners for income tax
         purposes. If the Partnership's tax returns are examined by the Internal
         Revenue  Service  or state  taxing  authority  and such an  examination
         results in a change in Partnership  taxable income (loss),  such change
         will be reported to the Partners.

         G. Rental Income

         Leases require the payment of rent in advance;  however,  rental income
         is recorded as earned.

         H. Long-Lived Assets

         In 1996,  the  Partnership  adopted  Statement of Financial  Accounting
         Standards  No.  121  (SFAS  121),  "Accounting  for the  Impairment  of
         Long-Lived Assets to be Disposed of." SFAS 121 requires that long-lived
         assets  be  reviewed  for  impairment  whenever  events or  changes  in
         circumstances   indicate   that  their   carrying   value  may  not  be
         recoverable. The adoption of SFAS 121 had no effect on reported results
         in 1996.  As of the year  ended  December  31,  1997,  the  Partnership
         recorded  the assets at the lower of carrying  value or net  realizable
         value and has included these amounts as Assets Held for Sale.

         I.  New Accounting Standards

         In 1997,  the  Partnership  adopted  Statement of Financial  Accounting
         Standards  No. 128 (SFAS 128),  "Earnings  Per Share." This  accounting
         standard  specifies  new  computation,   presentation,  and  disclosure
         requirements for earnings per share to be applied retroactively.  Among
         other  things,  SFAS 128  requires  presentation  of basic and  diluted
         earnings per share on the face of the income statement. The computation
         of basic and diluted  earnings per share was based on income  available
         to the Limited Partners divided by the weighted average number of units
         outstanding  during the period.  The  Partnership  has no dilutive type
         securities.  The  adoption  of SFAS 128 had no  effect  on the per unit
         results previously reported.


<PAGE>


3.  Cash and Cash Equivalents:

Cash and cash  equivalents at September 30, 1998 and December 31, 1997 consisted
of the following:
                                               September 30,        December 31,
                                                     1998          1997
                                                     ----          ----
    Cash on hand                                    $315,161       $132,330
    Money market accounts                                           289,250
                                                    -------         -------
                                                    $315,161       $421,580

4.  Joint Venture and Property Acquisitions:

The  Partnership  has invested in three  properties  located in  Scottsdale  and
Tucson,  Arizona and Colorado Springs,  Colorado. The success of the Partnership
will  depend upon  factors  which are  difficult  to predict  including  general
economic and real estate market conditions,  both on a national basis and in the
areas where the Partnership's  investments are located.  The Partnership holds a
majority  interest in these  properties and controls the operations of the joint
ventures.

Villas Sin Vacas

On October 25, 1985,  the  Partnership  acquired a majority  interest in the Sin
Vacas Joint Venture,  which owns and operates the Villas at Sin Vacas, a 72-unit
residential  property located in Tucson,  Arizona.  Since the Partnership owns a
majority interest in the Sin Vacas Joint Venture, the accounts and operations of
the Sin Vacas Joint Venture have been consolidated into the Partnership.

The co-venture  partner was an affiliate of Evans Withycombe,  Inc.  ("EWI"),  a
Phoenix based residential development,  construction and management firm. EWI is
also the developer of the Villas Sin Vacas property.

The Partnership made initial cash payments in the form of capital  contributions
totaling $2,458,507 and funded $398,949 of property acquisition costs which were
treated as a capital  contribution  to the joint  venture.  Since  completion of
construction,   the  Partnership  has  made  additional  contributions  totaling
$275,167.  At June 30, 1998,  the total capital  contributions  and  acquisition
costs incurred were $2,713,937 and $418,686, respectively.

JANUARY 1, 1996 THROUGH MAY 13, 1996

Net cash from  operations (as defined in the joint venture  agreement) was to be
distributed as available to each joint venture partner quarterly as follows:

         First,  to the  Partnership,  an  amount  equal  to  8.75%  per  annum,
         noncumulative  (computed daily on a simple noncompounded basis from the
         date of completion funding) of the Partnership's capital investment, as
         defined in the joint venture agreement;

         Second, the balance 70% to the Partnership and 30% to the co-venturer.

All losses from operations and depreciation for the Sin Vacas Joint Venture were
allocated 99% to the Partnership and 1% to the co-venturer.
<PAGE>

4.  Joint Venture and Property Acquisitions, continued:

All profits from operations,  to the extent of cash distributions were allocated
to  the  Partnership  and  co-venturer  in  the  same  proportion  as  the  cash
distribution. Any remaining profits are allocated 70% to the Partnership and 30%
to the co-venturer.

In the case of certain capital  transactions and distributions as defined in the
joint venture  agreement,  the  allocation of related  profits,  losses and cash
distributions,  if any, would be different than as described  above and would be
effected by the relative balances in the individual partners' capital accounts.

Villa Antigua

On June 11,  1987,  the  Partnership  acquired a majority  interest in the Villa
Antigua  Joint  Venture,  which  owns and  operates  Villa  Antigua,  an 88-unit
residential property located in Scottsdale,  Arizona. Since the Partnership owns
a majority  interest  in the Villa  Antigua  Joint  Venture,  the  accounts  and
operations of the Villa Antigua  Joint Venture have been  consolidated  into the
Partnership.

The co-venture  partner was an affiliate of Evans Withycombe,  Inc.  ("EWI"),  a
Phoenix based residential development,  construction and management firm. EWI is
also the developer of the Villa Antigua property.

The Partnership made initial cash payments in the form of capital  contributions
totaling $2,494,677 and funded $381,729 of property acquisition costs which were
treated as a capital  contribution  to the Villa  Antigua Joint  Venture.  Since
completion of  construction,  the Partnership has made additional  contributions
totaling $85,440. The total capital contributions and acquisition costs incurred
were $2,580,117 and $381,729, respectively.

JANUARY 1, 1996 THROUGH MAY 13, 1996

Net cash from  operations (as defined in the joint venture  agreement) was to be
distributed as available to each joint venture partner quarterly as follows:

         First,  to  the  Partnership,   an  amount  equal  to  10%  per  annum,
         noncumulative  (computed daily on a simple noncompounded basis from the
         date of  completion  funding)  of the  Partnership's  adjusted  capital
         investment, as defined in the joint venture agreement;

Second, the balance 70% to the Partnership and 30% to the co-venturer.

All losses from operations and  depreciation for the Villa Antigua Joint Venture
were allocated 99% to the Partnership and 1% to the co-venturer.

All profits from operations, to the extent of cash distributions, were allocated
to  the  Partnership  and  co-venturer  in  the  same  proportion  as  the  cash
distributions; however, if for any taxable year there are no cash distributions,
profits are allocated 99% to the Partnership and 1% to the co-venturer.

In the case of certain capital  transactions and distributions as defined in the
joint venture  agreement,  the  allocation of related  profits,  losses and cash
distributions,  if any, would be different than as described  above and would be
affected by the relative balances in the individual partners' capital accounts.


<PAGE>

4.Joint Venture and Property Acquisitions, continued:


Sin Vacas and Villa Antigua

MAY 14, 1996 THROUGH NOVEMBER 25, 1997

On May 14, 1996, the Partnership and certain affiliates consummated an agreement
with Evans  Withycombe  Management,  Inc. and certain of its affiliates  ("EWI")
which  separated the interests of EWI and the  Partnership,  thus  affording the
Partnership  greater  flexibility  in  the  operation  and  disposition  of  the
properties.  In  consideration of a payment by the Partnership to EWI of $73,775
and delivery of certain mutual  releases,  EWI (i)  relinquished its contract to
manage  Sin Vacas and Villa  Antigua  and its option to  exercise  its rights of
first refusal with regard to the sale of those  properties and (ii) assigned all
of its  interest in the Sin Vacas  Joint  Venture  and the Villa  Antigua  Joint
Venture to the  Partnership  (while  preserving  the  economic  interests of the
venturer in these Joint Ventures),  which resulted in the dissolution of the Sin
Vacas Joint Venture and the Villa Antigua Joint Venture.  EWI may still share in
the cash flow  distributions  or proceeds from sale of the properties if certain
performance levels are met.

On November 25, 1997,  Villa Sin Vacas was sold  pursuant to the terms of a Sale
Agreement  and escrow  Instructions  (the  "Agreement")  dated May 6,  1997,  as
amended. Villas Sin Vacas was sold to Villas Sin Vacas Townhome Ventures Limited
Partnership,  an Arizona Limited Partnership  unaffiliated with the Partnership,
the assignee of Capital Management  Systems,  Inc., a Pennsylvania  Corporation.
The net  selling  price for Villas Sin Vacas was  $4,952,091  subject to certain
customary  adjustments.  The Partnership  repaid first mortgage financing in the
amount of $2,396,000  at closing  utilizing a portion of proceeds from the sale.
The Partnership recorded a gain on sale of approximately $975,000.

On October 10,  1997,  Villa  Antigua  was sold  pursuant to the terms of a Sale
Agreement  and escrow  Instructions  (the  "Agreement")  dated May 6,  1997,  as
amended.  Villa  Antigua  was sold to Villa  Sin  Antigua  Condominium  Ventures
Limited  Partnership,  an  Arizona  Limited  Partnership  unaffiliated  with the
Partnership,  the assignee of Capital Management  Systems,  Inc., a Pennsylvania
Corporation.  The net selling price for Villa Antigua was $6,141,526  subject to
certain customary  adjustments.  The Partnership repaid first mortgage financing
in the amount of $3,010,362 at closing  utilizing a portion of proceeds from the
sale. The Partnership recorded a gain on sale of approximately $1,307,000.

Pinecliff

On July 16, 1986, the Partnership  acquired Pinecliff (formerly Autumn Ridge), a
96-unit  residential   property  located  in  Colorado  Springs,   Colorado  and
simultaneously  contributed  the  property  to the Autumn  Ridge  Joint  Venture
comprised of the Partnership and an affiliate of the property  developer.  Since
the Partnership owns a majority interest in the Autumn Ridge Joint Venture,  the
accounts and operations of the Autumn Ridge Joint Venture have been consolidated
into the Partnership.

The co-venture partner was Highland Properties, Inc. ("Highland") a Colorado
based residential development, construction and management firm.  Highland 
developed the property known as L'Auberge Pinecliff.

The Partnership made initial cash payments in the form of capital  contributions
totaling $3,819,397 and funded $546,576 of property acquisition costs which were
treated as a capital  contribution  to the Autumn  Ridge  Joint  Venture.  Since
completion of  construction,  the Partnership has made additional  contributions
totaling $318,811.

<PAGE>

4.Joint Venture and Property Acquisitions, continued:


JANUARY 1, 1996 THROUGH JULY 2, 1996:

Net cash from  operations (as defined in the joint venture  agreement) was to be
distributed as available to each joint venture partner quarterly as follows:

         First,  to  the   Partnership,   an  amount  equal  to  8%  per  annum,
         noncumulative  (computed daily on a simple noncompounded basis from the
         date of completion funding) of the Partnership's capital investment, as
         defined in the joint venture agreement;

         Second, the balance 82% to the Partnership and 18% to the co-venturer.

All losses from operations and  depreciation  for the Autumn Ridge Joint Venture
were allocated 100% to the Partnership.

All profits from operations, to the extent of cash distributions, were allocated
to  the  Partnership  and  co-venturer  in  the  same  proportion  as  the  cash
distribution. Any remaining profits are allocated 82% to the Partnership and 18%
to the co-venturer.

In the case of certain capital  transactions and distributions as defined in the
joint venture  agreement,  the  allocation of related  profits,  losses and cash
distributions,  if any, would be different than as described  above and would be
affected by the relative balances in the individual partners' capital accounts.

JULY 3, 1996 THROUGH MAY 28, 1998

On July 3, 1996, the Partnership and certain affiliates consummated an agreement
with Highland  Properties,  Inc.  ("Highland")  which separated the interests of
Highland and the Partnership, thus affording the Partnership greater flexibility
in the operation and disposition of the property.  In consideration of a payment
by the Partnership to Highland  totaling $7,718,  and delivery of certain mutual
releases,  Highland (i)  relinquished its option to exercise its rights of first
refusal  with regard to the sale of the  property  and (ii)  assigned all of its
interest in the L'Auberge  Pinecliff  Joint Venture to the  Partnership,  (while
preserving  the economic  interests  of the  venturer in these Joint  Ventures),
which  resulted in the  dissolution  of the L'Auberge  Pinecliff  Joint Venture.
Highland may still share in the cash flow distributions or proceeds from sale of
the properties if certain performance levels are met.

On May 28, 1998, the Partnership sold its final real estate asset. Pinecliff was
sold to G&I Pinecliff LLC, a Delaware  limited  liability  company  unaffiliated
with the Partnership.  The purchase price for Pinecliff was $6,700,000,  subject
to certain  customary  adjustments and a $360,000  credit to the purchaser.  The
Partnership repaid mortgage financing in the approximate amount of $3,041,860 at
closing utilizing a portion of proceeds from the sale. The Partnership  realized
net proceeds of approximately $3,145,390 from the sale of Pinecliff.



<PAGE>




5.       Mortgage Notes Payable:

Pinecliff
The original  maturity date for these notes was July 15, 1997. On July 10, 1997,
the lender  extended  the terms of the  mortgage  note for a period of one year.
Under the modification agreement,  the monthly principal and interest payment of
$27,976 and the original interest rate of 9.125% remained  unchanged.  The terms
of the  agreement  provide for a prepayment  penalty of 0.5% of the  outstanding
loan  amount in the event the note is paid  prior to 60 days  before it  becomes
due. As discussed in Note 4, the Partnership  sold Pinecliff and the outstanding
mortgage debt of $3,041,860 was paid.  There was no prepayment  penalty assessed
since the debt was paid within 60 days of maturity.

The  property  owned  by the  Partnership  was  pledged  as  collateral  for the
nonrecourse   mortgage  notes  payable  outstanding  December  31,  1997,  which
consisted of the following:

                                                     1998                  1997
                                                     ----                  ----
  Pinecliff                                          -                $3,058,800


6.  Partners' Equity:

Under the terms of the  Partnership  Agreement  profits are allocated 95% to the
Limited Partners and 5% to the General Partners; losses are allocated 99% to the
Limited Partners and 1% to the General Partners.

Cash distributions to the partners are governed by the Partnership Agreement and
are made,  to the extent  available,  95% to the Limited  Partners and 5% to the
General Partners.

Gain  from  the  sale  of  properties  is to be  allocated  as  defined  in  the
Partnership Agreement. The net proceeds on the sale of Pinecliff of $3.1 million
were  allocated  as follows.  The  Limited  Partners  received  100% of the cash
distribution  from sale.  The total gain on sale of  Pinecliff  of $452,214  was
allocated as follows.  The General Partner received a gain on sale allocation of
$125,972  and  the  Limited  Partners  received  a gain on  sale  allocation  of
$326,242. These  distributions/allocations  were in accordance with the terms of
the Partnership Agreement.

7.  Related-Party Transactions:

L'Auberge Communities, Inc. is a General Partner of L'Auberge Communities, which
owns a 99% interest in GP L'Auberge Communities,  L.P. (formerly Berry and Boyle
Management).  Due to  affiliates  at  September  30, 1998 and  December 31, 1997
consisted of  reimbursable  costs  payable to L'Auberge  Communities,  Inc.,  an
affiliate  of the  General  Partners,  in the  amounts of $20,384  and  $16,076,
respectively.

For the period ended  September  30, 1998 and 1997,  general and  administrative
expenses included $47,620 and $45,064,  respectively,  of salary  reimbursements
paid to the General Partners for certain administrative and accounting personnel
who performed services for the Partnership.




<PAGE>


18

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
              RESULTS OF OPERATIONS


Liquidity and Capital Resources

At September 30, 1998, the Partnership had cash and cash equivalents of $315,161
compared  with  $421,580 at December 31,  1997.  The  aggregate  net decrease of
$106,419  resulted  primarily  from  proceeds  from  the  sale of  Pinecliff  of
$6,608,653, plus $131,413 received from the escrow agent relating to the sale of
Villa Sin Vacas,  plus a refund of deposits of $1,335 offset by distributions to
the limited  partners of  $3,242,100,  principal  payments on the mortgage notes
payable of $3,058,800,  purchase of fixed assets of $361,293 and the cash needed
for operations of $185,626.


Property Status

On May 28, 1998, the Partnership sold its final real estate asset,  Pinecliff, a
96-unit  multi-family rental property in Colorado Springs,  Colorado.  Pinecliff
was sold to G&I Pinecliff LLC, a Delaware limited liability company unaffiliated
with the Partnership.  The purchase price for Pinecliff was $6,700,000,  subject
to certain  customary  adjustments and a $360,000  credit to the purchaser.  The
Partnership repaid mortgage financing in the approximate amount of $3,041,860 at
closing utilizing a portion of proceeds from the sale. The Partnership  realized
net proceeds of approximately $3,145,390 from the sale of Pinecliff.

During the fourth  quarter of 1997, the  Partnership  sold two  properties:  (1)
Villas at Sin Vacas, a 72-unit  multifamily rental property in Tucson,  Arizona,
which was sold in November 1997; and (2) Villa Antigua,  an 88-unit  multifamily
rental  property in  Scottsdale,  Arizona,  which was sold in October 1997.  The
ownership of each  property was formerly  structured as a Joint Venture in which
the Partnership owned a majority interest. With regard to the termination of the
Joint Ventures and the sales of properties,  see Note 4 of Notes to Consolidated
Financial Statements.


<PAGE>



Results of Operations

For the three  months ended  September  30, 1998,  the  Partnership's  operating
results were  comprised of its share of the income and expenses from Pinecliff ,
as well as partnership  level interest income earned on short term  investments,
reduced by administrative expenses. A summary of these operating results appears
below.

                                              Investment
                                              Partnership

Total revenue                                        $17,328

Expenses:
  General and administrative                          47,710
  Operations                                           -
  Depreciation and amortization                        -
  Interest                                             -
                                              ---------------
                                                      47,710
                                              ---------------
Net loss from operations                            (30,382)
                                              ---------------

Net loss                                           ($30,382)
                                              ===============


For the three  months  ended  September  30,  1997 the  Partnership's  operating
results  were  comprised  of its share of the income and  expenses  from the Sin
Vacas, Pinecliff and Villa Antigua, as well as partnership level interest income
earned on short term investments,  reduced by administrative expenses. A summary
of these operating results appears below.
<TABLE>

                                          Sin       L'Auberge       Villa    Investment   Consolidated
                                          Vacas     Pinecliff      Antigua   Partnership      Total
<S>                                    <C>          <C>          <C>          <C>          <C>      
Total revenue ......................   $ 180,182    $ 232,856    $ 200,053    $   7,477    $ 620,568

Expenses:
  General and administrative                                                     54,436       54,437
  Operations .......................     110,364      123,269      138,375                   372,008
  Depreciation and amortization.....      33,983       50,575       32,670                   117,228
  Interest .........................      57,359       72,804       70,674                   200,837
                                       ---------    ---------    ---------    ---------    ---------
                                         201,706      246,648      241,719       54,436      744,510
                                       ---------    ---------    ---------    ---------    ---------
Net income .........................   ($ 21,524)   ($ 13,792)   ($ 41,666)   ($ 46,959)   ($123,942)
                                       =========    =========    =========    =========    =========



<PAGE>


For the nine months ended September 30, 1998 the Partnership's operating results
were comprised of its share of the income and expenses from  Pinecliff,  as well
as partnership level interest income earned on short term  investments,  reduced
by administrative expenses. A summary of these operating results appears below.

                                           L'Auberge        Investment        Consolidated
                                           Pinecliff        Partnership          Total
<S>                                           <C>                  <C>             <C>     
Total revenue                                 $418,001             $36,168         $454,169

Expenses:
  General and administrative                      -                153,208          153,208
  Operations                                   181,377               1,284          182,661
  Depreciation and amortization                  7,888               -                7,888
  Interest                                     117,384               -              117,384
                                          -------------     ---------------  ---------------
                                               306,649             154,492          461,141
                                          -------------     ---------------  ---------------
                                          
Net loss from operations                       111,352           (118,342)          (6,972)
                                          -------------     ---------------  ---------------

Gain from sale of property                     452,214                              452,214
                                          -------------     ---------------  ---------------

Net income                                    $563,566          ($118,342)         $445,242
                                          =============     ===============  ===============

For the nine months  ended  September  30,  1997,  the  Partnership's  operating
results  were  comprised  of its share of the income and  expenses  from the Sin
Vacas, Pinecliff and Villa Antigua, as well as partnership level interest income
earned on short term investments,  reduced by administrative expenses. A summary
of these operating results appears below.

                                        Sin           L'Auberge           Villa         Investment        Consolidated
                                       Vacas          Pinecliff          Antigua        Partnership           Total
<S>                                     <C>               <C>               <C>              <C>           <C>       
Total revenue                           $538,653          $715,030          $644,429         $26,922       $1,925,034

Expenses:
  General and administrative                                                                 170,578          170,579
  Operations                             289,233           340,417           325,929              18          955,597
  Depreciation and amortization           97,322           141,476            93,991                          332,789
  Interest                               167,788           214,325           207,906                          590,019
                                    -------------   ---------------  ----------------   ------------- ----------------
                                         554,343           696,218           627,826         170,596        2,048,984
                                    -------------   ---------------  ----------------   ------------- ----------------
Net income                             ($15,690)           $18,812           $16,603      ($143,674)       ($123,950)
                                    =============   ===============  ================   ============= ================

</TABLE>

Comparison of Operating Results for the Nine Months Ended September 30, 1998 and
1997:

Partnership  operations  for the nine months ended  September 30, 1998 generated
net income of $445,242  compared with net loss of $128,950 for the corresponding
period in 1997.  Included  in the net income of $445,242 is the gain on the sale
of Pinecliff in the amount of $452,214. The loss from operations was $6,972. The
total  operating  revenue  decreased by  $1,470,865 or 76%, due to the fact that
Villa Sin Vacas and Villa  Antigua  were sold in the  fourth  quarter of 1997and
Pinecliff was sold in May 1998. Likewise,  operating expenses decreased in total
by  $772,936  or  81%  due  to  the  sales  of  the   properties.   General  and
administrative expenses have decreased by $17,371 or 10%, due primarily to lower
legal and accounting expenses.

The  Partnership  distributed  the sale proceeds  from  Pinecliff to the limited
partners in the amount of $3,242,100 or $100 per interest.



<PAGE>



                            PART II-OTHER INFORMATION


ITEM 1.  Legal Proceedings
         Response:  None

ITEM 2.  Changes in Securities
         Response:  None

ITEM 3.  Defaults Upon Senior Securities
         Response:  None

ITEM 4.  Submission of Matters to a Vote of Security Holders
         Response:  None

ITEM 5.  Other Information
         Response:  None

ITEM 6.  Exhibits and Reports on Form 8-K
(A.)     Exhibit - None
(B.)     Report on Form 8-K, Item2, dated October 10,1997 filed October 23, 1997
(C.)     Report on Form 8-K, Item2, dated May 28, 1998  filed on  June 10, 1998



                                   SIGNATURES


         Pursuant to the  requirements  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.



                                                      CLUSTER HOUSING PROPERTIES

                By: GP L'Auberge Communities, L.P., a California
                      Limited Partnership, General Partner

              By: L'Auberge Communities, Inc., its General Partner


           By: __/s/ Stephen B. Boyle_________________________________
                           Stephen B. Boyle, President


                             Date: November 13, 1998