SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   Form 10-KSB

 (Mark One)
[X]   ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
         1934


                    For the fiscal year ended December 31, 2002

[ ]   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
         OF 1934


                  For the transition period _________to _________

                         Commission file number 0-13454

                          NATIONAL PROPERTY INVESTORS 7
                 (Name of small business issuer in its charter)

         California                                             13-3230613
(State or other jurisdiction of                              (I.R.S. Employer
 incorporation or organization)                             Identification No.)

                         55 Beattie Place, P.O. Box 1089
                        Greenville, South Carolina 29602
                    (Address of principal executive offices)

                                 (864) 239-1000
                            Issuer's telephone number

           Securities registered under Section 12(b) of the Exchange Act:

                                      None

           Securities registered under Section 12(g) of the Exchange Act:

                      Units of Limited Partnership Interest
                                (Title of class)

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act of 1934 during the past 12 months (or for such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to such filing requirements for the past 90 days. Yes X No___

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure  will be contained,  to
the  best  of  Registrant's   knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this Form 10-KSB. [X]

State issuer's revenues for its most recent fiscal year.  $7,744,000

State the aggregate  market value of the voting  partnership  interests  held by
non-affiliates  computed  by  reference  to the price at which  the  partnership
interests  were sold,  or the average bid and asked  prices of such  partnership
interests as of December 31, 2002. No market exists for the limited  partnership
interests of the Registrant,  and,  therefore,  no aggregate market value can be
determined.

                       DOCUMENTS INCORPORATED BY REFERENCE
                                      NONE

The matters discussed in this report contain certain forward-looking statements,
including, without limitation, statements regarding future financial performance
and the effect of government  regulations.  The discussions of the  Registrant's
business  and  results  of  operations,   including  forward-looking  statements
pertaining to such matters,  do not take into account the effects of any changes
to the  Registrant's  business  and results of  operations.  Actual  results may
differ  materially  from those described in the  forward-looking  statements and
will  be  affected  by  a  variety  of  risks  and  factors  including,  without
limitation:  national and local economic  conditions;  the terms of governmental
regulations that affect the Registrant and interpretations of those regulations;
the competitive  environment in which the Registrant operates;  financing risks,
including the risk that cash flows from  operations may be  insufficient to meet
required  payments of  principal  and  interest;  real estate  risks,  including
variations  of real  estate  values and the  general  economic  climate in local
markets and competition for tenants in such markets; and possible  environmental
liabilities.   Readers  should  carefully  review  the  Registrant's   financial
statements and the notes thereto,  as well as the risk factors  described in the
documents  the  Registrant  files  from  time to time  with the  Securities  and
Exchange Commission.

                                     PART I

Item 1.     Description of Business

National  Property   Investors  7  (the  "Partnership"  or  "Registrant")  is  a
California  limited  partnership  formed in October  1983.  The  Partnership  is
engaged in the business of  operating  and holding  real estate  properties  for
investment.  NPI Equity  Investments,  Inc., a Florida  corporation,  became the
Registrant's  managing  general partner (the "Managing  General Partner" or "NPI
Equity") on December 20, 1991. The Managing  General Partner was a subsidiary of
National Property Investors, Inc. ("NPI") until December 31, 1996, at which time
Insignia  Properties Trust ("IPT") acquired the stock of NPI Equity.  On October
1, 1998, IPT merged into Apartment  Investment and Management Company ("AIMCO"),
a publicly  traded real  estate  investment  trust.  The  partnership  agreement
provides  that the  Partnership  is to terminate  on December  31, 2008,  unless
terminated prior to such date.

From  February 1984 through  February  1985,  the  Partnership  offered  100,000
limited  partnership  units at $500 per unit for an aggregate of $50,000,000 and
sold  60,517  units  providing  net  proceeds  of  $30,259,000,  pursuant  to  a
Registration Statement filed with the Securities and Exchange Commission.  Since
its initial offering,  the Registrant has not received, nor are limited partners
required to make,  additional  capital  contributions.  The net proceeds of this
offering were used to purchase seven income  producing  residential  real estate
properties.  The Partnership's  original property  portfolio was  geographically
diversified  with properties  acquired in six states.  One property was sold and
another was foreclosed on in 1994.  The Registrant  continues to own and operate
the remaining five properties (see "Item 2. Description of Properties").

The  Partnership has no employees.  The Managing  General Partner is vested with
full authority as to the general  management and supervision of the business and
affairs of the Partnership. The limited partners have no right to participate in
the  management  or conduct of such  business and  affairs.  An affiliate of the
Managing  General  Partner  provides  day-to-day   management  services  to  the
Partnership's investment properties.

<PAGE>

Risk Factors

The  real  estate  business  in which  the  Partnership  is  engaged  is  highly
competitive.  There are other  residential  properties within the market area of
the Registrant's  properties.  The number and quality of competitive properties,
including  those which may be managed by an affiliate  of the  Managing  General
Partner,  in such market area could have a material  effect on the rental market
for the  apartments  at the  Registrant's  properties  and the rents that may be
charged  for  such  apartments.  While  the  Managing  General  Partner  and its
affiliates  own and/or  control a significant  number of apartment  units in the
United  States,  such  units  represent  an  insignificant  percentage  of total
apartment  units in the United  States and  competition  for the  apartments  is
local.

Laws benefiting  disabled persons may result in the Partnership's  incurrence of
unanticipated  expenses.  Under the Americans with  Disabilities Act of 1990, or
ADA,  all places  intended to be used by the public are required to meet certain
Federal  requirements  related to access and use by disabled persons.  Likewise,
the Fair Housing Amendments Act of 1988, or FHAA, requires apartment  properties
first occupied after March 13, 1990 to be accessible to the  handicapped.  These
and other  Federal,  state  and  local  laws may  require  modifications  to the
Partnership's   properties,   or  restrict   renovations   of  the   properties.
Noncompliance  with  these laws could  result in the  imposition  of fines or an
award of  damages  to private  litigants  and also  could  result in an order to
correct any  non-complying  feature,  which could result in substantial  capital
expenditures.   Although  the  Managing   General  Partner   believes  that  the
Partnership's   properties  are   substantially   in  compliance   with  present
requirements,  the Partnership may incur  unanticipated  expenses to comply with
the ADA and the FHAA.

Both  the  income  and  expenses  of  operating  the  properties  owned  by  the
Partnership are subject to factors outside of the Partnership's control, such as
changes in the supply and demand for similar  properties  resulting from various
market  conditions,  increases/decreases  in unemployment or population  shifts,
changes in the availability of permanent mortgage  financing,  changes in zoning
laws,  or changes in patterns or needs of users.  In  addition,  there are risks
inherent in owning and operating residential  properties because such properties
are  susceptible to the impact of economic and other  conditions  outside of the
control of the Partnership.

There have been, and it is possible there may be other, Federal, state and local
legislation  and  regulations   enacted   relating  to  the  protection  of  the
environment.  The Partnership is unable to predict the extent,  if any, to which
such new  legislation  or  regulations  might occur and the degree to which such
existing or new legislation or regulations might adversely affect the properties
owned by the Partnership.

The Partnership  monitors its properties for evidence of pollutants,  toxins and
other dangerous substances, including the presence of asbestos. In certain cases
environmental  testing has been performed which resulted in no material  adverse
conditions or liabilities. In no case has the Registrant received notice that it
is a potentially  responsible  party with respect to an  environmental  clean up
site.

Insurance  coverage is becoming  more  expensive  and  difficult to obtain.  The
current  insurance market is  characterized by rising premium rates,  increasing
deductibles,  and more restrictive  coverage language.  Recent developments have
resulted in  significant  increases in insurance  premiums and have made it more
difficult to obtain  certain types of insurance.  As an example,  many insurance
carriers are excluding  mold-related  risks from their policy coverages,  or are
adding  significant  restrictions to such coverage.  Continued  deterioration in
insurance   market  place   conditions  may  have  a  negative   effect  on  the
Partnership's operating results.

A further description of the Partnership's business is included in "Management's
Discussion and Analysis or Plan of Operation"  included in "Item 6" of this Form
10-KSB.

Item 2.     Description of Properties

The following table sets forth the Partnership's investment in properties:

<TABLE>
<CAPTION>

                                   Date of
Property                           Purchase       Type of Ownership          Use

<S>                                 <C>
Fairway View II Apartments          11/84    Fee ownership subject to    Apartment
  Baton Rouge, Louisiana                     first mortgage              204 units

The Pines Apartments                04/85    Fee ownership subject to    Apartment
  Roanoke, Virginia                          first mortgage              216 units

Patchen Place Apartments            07/85    Fee ownership subject to    Apartment
  Lexington, Kentucky                        first mortgage              202 units

Northwoods I & II Apartments        07/85    Fee ownership subject to    Apartment
  Pensacola, Florida                         first mortgage              320 units

South Point Apartments              03/86    Fee ownership subject to    Apartment
  Durham, North Carolina                     first mortgage              180 units
</TABLE>

Schedule of Properties

Set forth below for each of the  Partnership's  properties is the gross carrying
value, accumulated depreciation,  depreciable life, method of depreciation,  and
Federal tax basis.

<TABLE>
<CAPTION>

                        Carrying    Accumulated                            Federal
Property                 Value      Depreciation      Rate     Method     Tax Basis
                            (in thousands)                              (in thousands)

<S>                     <C>           <C>           <C>                    <C>
Fairway View II         $10,936       $ 6,785       5-30 yrs     S/L       $ 1,403
The Pines                 8,693         6,182       5-30 yrs     S/L         1,178
Patchen Place             9,402         7,230       5-30 yrs     S/L         1,489
Northwoods I & II        10,705         7,055       5-30 yrs     S/L         1,638
South Point               9,755         6,406       5-30 yrs     S/L         1,874
        Total           $49,491       $33,658                              $ 7,582
</TABLE>

See  "Item  7.  Financial   Statements,   Note  A"  for  a  description  of  the
Partnership's capitalization and depreciation policies.

<PAGE>

Schedule of Property Indebtedness

The  following  table  sets  forth  certain  information  relating  to the loans
encumbering the Registrant's properties.

<TABLE>
<CAPTION>

                         Principal                                        Principal
                        Balance At                                         Balance
                       December 31,    Interest    Period    Maturity       Due At
Property                   2002          Rate     Amortized    Date      Maturity (2)
                      (in thousands)                                    (in thousands)

<S>                       <C>           <C>        <C>       <C>   <C>       <C>
Fairway View II           $ 5,301       7.03%      20 yrs    12/01/21        $ --
The Pines                   3,942       7.97%      20 yrs    01/01/20           --
Patchen Place               3,000       7.33%        (1)     11/01/03        3,000
Northwoods I & II           6,792       7.06%      20 yrs    09/01/21           --
South Point                 4,600       7.33%        (1)     11/01/03        4,600
        Total             $23,635                                          $ 7,600
</TABLE>

(1)   Loan requires payments of interest only.

(2)   See "Item 7. Financial  Statements - Note B" for information  with respect
      to the  Registrant's  ability  to prepay  these  loans and other  specific
      details about the loans.

On  August  31,  2001,  the  Partnership  refinanced  the  mortgage  encumbering
Northwoods  I and  II  Apartments.  The  refinancing  replaced  indebtedness  of
$5,000,000 with a new mortgage in the amount of $7,000,000. The interest rate on
the new mortgage is 7.06% as compared to 7.33% on the previous mortgage. The new
loan matures on  September  1, 2021,  requires  monthly  principal  and interest
payments and is scheduled to be fully amortized at maturity.  Total  capitalized
loan costs were approximately  $252,000 during the year ended December 31, 2001.
The  Partnership  recognized  a loss  on the  early  extinguishment  of  debt of
approximately $67,000 due to the write off of unamortized loan costs.

On November 30,  2001,  the  Partnership  refinanced  the  mortgage  encumbering
Fairway View II Apartments.  The refinancing replaced indebtedness of $4,200,000
with a new mortgage in the amount of  $5,430,000.  The interest  rate on the new
mortgage is 7.03% as compared to 7.33% on the  previous  mortgage.  The new loan
matures on December 1, 2021,  requires monthly  principal and interest  payments
and is scheduled to be fully amortized at maturity. In addition, the Partnership
was required to establish a repair  escrow of  approximately  $179,000  with the
lender for  certain  capital  replacements.  Total  capitalized  loan costs were
approximately  $181,000 during the year ended December 31, 2001. The Partnership
recognized a loss on the early  extinguishment of debt of approximately  $40,000
due to the write off of unamortized loan costs.



<PAGE>


Rental Rates and Occupancy

Average annual rental rates and occupancy for 2002 and 2001 for each property:

<TABLE>
<CAPTION>

                                     Average Annual                   Average
                                      Rental Rates                   Occupancy
                                       (per unit)
Property                          2002            2001           2002         2001


<S>                              <C>             <C>              <C>          <C>
Fairway View II                  $7,098          $6,956           94%          92%
The Pines                         7,252           7,354           94%          95%
Patchen Place                     6,728           7,129           89%          86%
Northwoods I & II                 6,463           6,415           96%          95%
South Point                       8,278           8,863           91%          95%
</TABLE>

The Managing General Partner attributes the decrease in occupancy at South Point
Apartments to increased home purchases and increased  competition in the area of
the property.  The Managing General Partner attributes the increase in occupancy
at Patchen Place Apartments to increased marketing efforts.

As noted under "Item 1.  Description of Business",  the real estate  industry is
highly  competitive.  All of the  properties of the  Partnership  are subject to
competition from other residential apartment complexes in the area. The Managing
General Partner believes that all of the properties are adequately insured. Each
property is an apartment  complex which leases units for lease terms of one year
or less. No residential tenant leases 10% or more of the available rental space.
All  of the  properties  are in  good  physical  condition,  subject  to  normal
depreciation and deterioration as is typical for assets of this type and age.

Real Estate Taxes and Rates

Real estate taxes and rates in 2002 for each property were:

                                       2002            2002
                                       Taxes          Rates
                                 (in thousands)

          Fairway View II              $ 47           10.40%
          The Pines                      77            1.12%
          Patchen Place                  43            0.96%
          Northwoods I & II             165            2.09%
          South Point                    97            1.30%

Capital Improvements

Fairway View II

During the year ended December 31, 2002, the Partnership completed approximately
$88,000 of capital  improvements  at Fairway  View II,  consisting  primarily of
floor  covering and air  conditioning  unit  replacements,  and  structural  and
building improvements.  These improvements were funded from operating cash flow.
The  Partnership is currently  evaluating the capital  improvement  needs of the
property for the upcoming  year and  currently  expects to budget  approximately
$61,000.  Additional  improvements may be considered during 2003 and will depend
on the physical  condition of the property as well as  replacement  reserves and
anticipated cash flow generated by the property.


<PAGE>


The Pines

During the year ended December 31, 2002, the Partnership completed approximately
$81,000 of capital  improvements  at The Pines,  consisting  primarily  of floor
covering,  appliance,  air conditioning  unit, and cabinet  replacements.  These
improvements  were funded from operating cash flow. The Partnership is currently
evaluating the capital  improvement  needs of the property for the upcoming year
and currently expects to budget approximately $65,000.  Additional  improvements
may be considered  during 2003 and will depend on the physical  condition of the
property and anticipated cash flow generated by the property.

Patchen Place

During the year ended December 31, 2002, the Partnership completed approximately
$167,000 of capital improvements at Patchen Place, consisting primarily of floor
covering,  appliance,  air conditioning  unit and heating unit  replacements and
parking lot upgrades.  These improvements were funded from Partnership reserves,
replacement  reserves,  and operating  cash flow.  The  Partnership is currently
evaluating the capital  improvement  needs of the property for the upcoming year
and currently expects to budget approximately $61,000.  Additional  improvements
may be considered  during 2003 and will depend on the physical  condition of the
property as well as replacement  reserves and anticipated cash flow generated by
the property.

Northwoods I and II

During the year ended December 31, 2002, the Partnership completed approximately
$160,000 of capital  improvements at Northwoods I & II, consisting  primarily of
floor  covering,  air  conditioning  unit and  appliance  replacements,  fitness
equipment  and  structural  improvements.  These  improvements  were funded from
operating  cash flow.  The  Partnership  is  currently  evaluating  the  capital
improvement needs of the property for the upcoming year and currently expects to
budget approximately $96,000.  Additional  improvements may be considered during
2003 and will depend on the physical  condition of the property and  anticipated
cash flow generated by the property.

South Point

During the year ended December 31, 2002, the Partnership completed approximately
$155,000 of capital  improvements at South Point,  consisting primarily of floor
covering,  appliance and air conditioning  unit replacements and installation of
water  submetering  units.  These  improvements  were  funded  from  Partnership
reserves and operating  cash flow. The  Partnership is currently  evaluating the
capital  improvement  needs of the property for the upcoming  year and currently
expects  to  budget  approximately  $54,000.   Additional  improvements  may  be
considered during 2003 and will depend on the physical condition of the property
as well as  Partnership  reserves  and  anticipated  cash flow  generated by the
property.

Item 3.     Legal Proceedings

In March 1998, several putative unit holders of limited partnership units of the
Partnership  commenced an action  entitled  Rosalie  Nuanes,  et al. v. Insignia
Financial Group, Inc., et al. (the "Nuanes action") in the Superior Court of the
State of  California  for the  County  of San  Mateo.  The  plaintiffs  named as
defendants,  among others,  the  Partnership,  its Managing  General Partner and
several of their  affiliated  partnerships  and corporate  entities.  The action
purports  to  assert  claims  on  behalf  of a class  of  limited  partners  and
derivatively  on behalf  of a number  of  limited  partnerships  (including  the
Partnership)  which are named as nominal  defendants,  challenging,  among other
things,  the  acquisition  of  interests  in certain  Managing  General  Partner
entities by Insignia Financial Group, Inc. ("Insignia") and entities which were,
at one  time,  affiliates  of  Insignia;  past  tender  offers  by the  Insignia
affiliates to acquire limited partnership units;  management of the partnerships
by the  Insignia  affiliates;  and the series of  transactions  which  closed on
October 1, 1998 and February 26, 1999 whereby  Insignia and Insignia  Properties
Trust,  respectively,  were merged  into AIMCO.  The  plaintiffs  seek  monetary
damages and equitable relief, including judicial dissolution of the Partnership.
On June 25, 1998, the Managing General Partner filed a motion seeking  dismissal
of the action.  In lieu of responding  to the motion,  the  plaintiffs  filed an
amended  complaint.  The Managing General Partner filed demurrers to the amended
complaint which were heard February 1999.

Pending the ruling on such  demurrers,  settlement  negotiations  commenced.  On
November 2, 1999,  the parties  executed and filed a Stipulation  of Settlement,
settling claims, subject to court approval, on behalf of the Partnership and all
limited partners who owned units as of November 3, 1999. Preliminary approval of
the  settlement  was obtained on November 3, 1999 from the Court,  at which time
the Court set a final  approval  hearing for  December  10,  1999.  Prior to the
December  10,  1999  hearing,  the  Court  received  various  objections  to the
settlement, including a challenge to the Court's preliminary approval based upon
the alleged lack of authority of prior lead counsel to enter the settlement.  On
December 14, 1999, the Managing  General  Partner and its affiliates  terminated
the  proposed  settlement.  In  February  2000,  counsel  for some of the  named
plaintiffs filed a motion to disqualify plaintiff's lead and liaison counsel who
negotiated  the  settlement.  On June  27,  2000,  the  Court  entered  an order
disqualifying  them  from the case and an  appeal  was  taken  from the order on
October 5, 2000. On December 4, 2000, the Court  appointed the law firm of Lieff
Cabraser  Heimann & Bernstein  LLP as new lead  counsel for  plaintiffs  and the
putative class.  Plaintiffs filed a third amended complaint on January 19, 2001.
On March 2, 2001,  the  Managing  General  Partner  and its  affiliates  filed a
demurrer to the third amended  complaint.  On May 14, 2001,  the Court heard the
demurrer to the third amended  complaint.  On July 10, 2001, the Court issued an
order  sustaining  defendants'  demurrer on certain  grounds.  On July 20, 2001,
Plaintiffs filed a motion for reconsideration of the Court's July 10, 2001 order
granting in part and denying in part defendants' demurrer. On September 7, 2001,
Plaintiffs  filed a fourth amended class and  derivative  action  complaint.  On
September 12, 2001, the Court denied Plaintiffs' motion for reconsideration.  On
October 5, 2001, the Managing General Partner and affiliated  defendants filed a
demurrer to the fourth amended complaint,  which was heard on December 11, 2001.
On February 2, 2002,  the Court served its order  granting in part the demurrer.
The  Court has  dismissed  without  leave to amend  certain  of the  plaintiffs'
claims.  On February 11, 2002,  plaintiffs  filed a motion  seeking to certify a
putative  class  comprised of all  non-affiliated  persons who own or have owned
units  in  the  partnerships.   The  Managing  General  Partner  and  affiliated
defendants  oppose the motion.  On April 29,  2002,  the Court held a hearing on
plaintiffs' motion for class  certification and took the matter under submission
after further  briefing,  as ordered by the court, was submitted by the parties.
On July 10, 2002,  the Court entered an order vacating the current trial date of
January 13, 2003 (as well as the  pre-trial  and  discovery  cut-off  dates) and
stayed the case in its  entirety  through  November  7, 2002 so that the parties
could have an opportunity to discuss settlement.  On October 30, 2002, the court
entered an order extending the stay in effect through January 10, 2003.

On January 8, 2003,  the parties filed a  Stipulation  of Settlement in proposed
settlement of the Nuanes action and the Heller action described below. The Court
has  scheduled  the hearing on  preliminary  approval  for April 4, 2003 and the
hearing on final approval for June 2, 2003.

In general  terms,  the  proposed  settlement  provides  for  certification  for
settlement  purposes of a settlement class consisting of all limited partners in
this  Partnership and others (the  "Partnerships")  as of December 20, 2002, the
dismissal  with  prejudice  and  release  of claims  in the  Nuanes  and  Heller
litigation,  payment by AIMCO of $9.9  million  (which shall be  distributed  to
settlement  class  members  after  deduction of attorney fees and costs of class
counsel and certain costs of  settlement)  and up to $ 1 million toward the cost
of independent  appraisals of the Partnerships'  properties by a Court appointed
appraiser.  An affiliate of the Managing General Partner has also agreed to make
a tender offer to purchase all of the partnership  interests in the Partnerships
within one year of final  approval,  if it is granted,  and to provide  partners
with the  independent  appraisals  at the time of these  tenders.  The  proposed
settlement  also provides for the  limitation  of the allowable  costs which the
Managing  General  Partner or its  affiliates  will charge the  Partnerships  in
connection with this litigation and imposes limits on the class counsel fees and
costs in this  litigation.  If the  Court  grants  preliminary  approval  of the
proposed settlement in March, a notice will be distributed to partners providing
detail on the terms of the proposed settlement.

During the third  quarter of 2001, a complaint  (the "Heller  action") was filed
against  the same  defendants  that are named in the  Nuanes  action,  captioned
Heller v. Insignia Financial Group. On or about August 6, 2001, plaintiffs filed
a first amended  complaint.  The first amended complaint in the Heller action is
brought as a purported  derivative  action,  and asserts  claims for among other
things  breach  of  fiduciary  duty;  unfair  competition;   conversion,  unjust
enrichment;  and judicial  dissolution.  Plaintiffs in the Nuanes action filed a
motion to  consolidate  the Heller action with the Nuanes action and stated that
the Heller action was filed in order to preserve the derivative claims that were
dismissed  without  leave to amend in the Nuanes action by the Court order dated
July 10, 2001. On October 5, 2001, the Managing  General  Partner and affiliated
defendants  moved to strike the first  amended  complaint  in its  entirety  for
violating  the Court's July 10, 2001 order  granting in part and denying in part
defendants'  demurrer in the Nuanes action, or alternatively,  to strike certain
portions of the complaint based on the statute of limitations.  Other defendants
in the action  demurred to the fourth  amended  complaint,  and,  alternatively,
moved to strike the complaint. On December 11, 2001, the court heard argument on
the motions  and took the matters  under  submission.  On February 4, 2002,  the
Court  served  notice of its order  granting  defendants'  motion to strike  the
Heller complaint as a violation of its July 10, 2001 order in the Nuanes action.
On March 27, 2002,  the plaintiffs  filed a notice  appealing the order striking
the  complaint.  Before  completing  briefing on the appeal,  the parties stayed
further proceedings in the appeal pending the Court's review of the terms of the
proposed settlement described above.

The  Managing  General  Partner  does  not  anticipate  that  any  costs  to the
Partnership, whether legal or settlement costs, associated with these cases will
be material to the Partnership's overall operations.

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

Item 4.     Submission of Matters to a Vote of Security Holders

During the quarter ended  December 31, 2002, no matter was submitted to the vote
of the unit holders through the solicitation of proxies or otherwise.


<PAGE>


                                     PART II

Item 5.     Market for the Partnership's Equity and Related Partner Matters

The  Partnership,  a publicly-held  limited  partnership,  offered up to 100,000
limited  partnership  units (the  "Units") and sold 60,517  limited  partnership
units aggregating  $30,259,000.  At December 31, 2002, the Partnership had 1,109
holders  of  record  owning an  aggregate  of 60,517  Units.  Affiliates  of the
Managing  General  Partner owned 41,649.67 Units or 68.82% at December 31, 2002.
No public trading market has developed for the Units,  and it is not anticipated
that such a market will develop in the future.

The following table sets forth the distributions made by the Partnership for the
years ended December 31, 2001 and 2002. See "Item 6. Management's Discussion and
Analysis or Plan of Operation" for further details.

                                                Distributions
                                                           Per Limited
                                        Aggregate        Partnership Unit
                                      (in thousands)

       01/01/01 - 12/31/01              $3,519 (1)            $57.57
       01/01/02 - 12/31/02               1,826 (2)             29.88

(1)   Consists  of   approximately   $1,133,000  of  cash  from  operations  and
      approximately  $2,386,000 of cash from the refinancing proceeds of Fairway
      View II Apartments in November 2001 and  Northwoods I and II Apartments in
      August 2001.

(2)   Consists  of   approximately   $1,584,000  of  cash  from  operations  and
      approximately  $242,000 of cash from the  refinancing  proceeds of Fairway
      View II Apartments in November 2001.

Future cash  distributions  will depend on the levels of net cash generated from
operations, the availability of cash reserves and the timing of debt maturities,
refinancings  and/or  property  sales.  The  Partnership's  cash  available  for
distribution is reviewed on a monthly basis. There can be no assurance, however,
that the  Partnership  will  generate  sufficient  funds from  operations  after
required capital  expenditures,  to permit any  distributions to its partners in
2003 or subsequent  periods.  See "Item 2.  Description  of Properties - Capital
Improvements" for information  relating to anticipated  capital  expenditures at
the properties.

In addition to its  indirect  ownership of the general  partner  interest in the
Partnership,  AIMCO and its affiliates owned 41,649.67 limited partnership units
in the Partnership  representing 68.82% of the outstanding units at December 31,
2002. A number of these Units were  acquired  pursuant to tender  offers made by
AIMCO or its  affiliates.  It is  possible  that  AIMCO or its  affiliates  will
acquire additional Units of limited  partnership  interest in the Partnership in
exchange  for  cash  or a  combination  of  cash  and  units  in  the  operating
partnership of AIMCO either through  private  purchases or tender offers.  Under
the  Partnership  Agreement,  unitholders  holding a  majority  of the Units are
entitled to take action with respect to a variety of matters which would include
voting on certain  amendments to the Partnership  Agreement and voting to remove
the  Managing  General  Partner.  As a result of its  ownership of 68.82% of the
outstanding Units, AIMCO is in a position to influence all voting decisions with
respect to the Registrant.  Although the Managing General Partner owes fiduciary
duties to the limited partners of the Partnership,  the Managing General Partner
also owes fiduciary duties to AIMCO as its sole  stockholder.  As a result,  the
duties of the Managing  General Partner,  as managing  general  partner,  to the
Partnership  and its limited  partners may come into conflict with the duties of
the  Managing  General  Partner  to  AIMCO,  as its sole  stockholder.  However,
DeForest  Ventures II L.P.,  from whom AIMCO,  through its merger with Insignia,
acquired  25,399  Units  (41.97% of the  units),  had agreed for the  benefit of
non-tendering  unit  holders,  that it would vote its  Units:  (i)  against  any
increase  in  compensation  payable  to  the  Managing  General  Partner  or  to
affiliates;  and (ii) on all other matters submitted by it or its affiliates, in
proportion  to the  votes  cast  by all  other  unit  holders.  Except  for  the
foregoing,  no other  limitations are imposed on AIMCO's or its affiliates right
to vote each unit acquired.

Item 6.     Management's Discussion and Analysis or Plan of Operation

This item should be read in conjunction with the financial  statements and other
items contained elsewhere in this report.

Results of Operations

The   registrant's  net  income  for  the  year  ended  December  31,  2002  was
approximately  $74,000 compared to net income of  approximately  $52,000 for the
year ended December 31, 2001 (see "Item 7. Financial  Statements - Note C" for a
reconciliation of these amounts to the Registrant's federal taxable income). The
increase in net income was due to a decrease in total expenses  partially offset
by a slight decrease in total revenues.

Total  expenses  decreased  due  to  decreases  in  operating  and  general  and
administrative  expenses and the recognition of loss on early  extinguishment of
debt during 2001.  Effective April 1, 2002, the Partnership adopted Statement of
Financial  Accounting Standards ("SFAS") No. 145, "Rescission of FASB Statements
No. 4, 44 and 64". SFAS No. 4 "Reporting Gains and Losses from Extinguishment of
Debt,"  required  that all  gains  and  losses  from  extinguishment  of debt be
aggregated and, if material,  classified as an extraordinary  item. SFAS No. 145
rescinds SFAS No. 4, and accordingly,  gains and losses from  extinguishment  of
debt should only be  classified as  extraordinary  if they are unusual in nature
and occur infrequently. Neither of these criteria applies to the Partnership. As
a result,  the  accompanying  statements  of  operations  have been  restated to
reflect  the  loss  on  early  extinguishment  of debt  at  Northwoods  I and II
Apartments  in 2001 (as  discussed  in  "Liquidity  and Capital  Resources")  in
operations rather than as an extraordinary  item. These decreases were partially
offset by an increase in depreciation, interest, and property tax expense.

Operating expenses decreased primarily due to decreases in property,  insurance,
and  maintenance  expenses  partially  offset by an increase  in  administrative
expenses.  Property expense decreased  primarily due to decreases in payroll and
related  benefits at Fairway View II, The Pines and Patchen Place Apartments and
utility  charges at Patchen Place and The Pines  Apartments.  Insurance  expense
decreased due to a decrease in insurance  premiums primarily at Northwoods I and
II Apartments.  Administrative expense increased primarily due to an increase in
legal fees at Fairway View II and South Point  Apartments.  Maintenance  expense
decreased  at Fairway  View II,  Patchen  Place,  Northwoods I and II, and South
Point Apartments  primarily due to the increase in the capitalization of certain
direct  and  indirect  costs,  primarily  payroll  related  costs  (see  Item 7.
Financial  Statements,   Note  A  -  Organization  and  Significant   Accounting
Policies).  General  and  administrative  expenses  decreased  primarily  due to
reduced costs of services included in management  reimbursements to the Managing
General  Partner  allowed  under the  Partnership  Agreement.  Also  included in
general  and  administrative  expenses  at both  December  31, 2002 and 2001 are
management  reimbursements  to the Managing General Partner as allowed under the
Partnership  Agreement and management fees paid to the Managing  General Partner
in connection with distributions made from operations, costs associated with the
quarterly and annual  communications  with investors and regulatory agencies and
the  annual  audit  required  by the  Partnership  Agreement.  Interest  expense
increased  due to the  refinancings  of Northwoods I and II Apartments in August
2001 and Fairway View II Apartments in November 2001 which increased the average
debt balance at these two properties.  Depreciation  expense increased primarily
due to property  improvements and replacements  completed during the last twelve
months.  Property taxes increased due to the  reassessment of property values by
the local  taxing  authority  at Patchen  Place and Fairway  View II  Apartments
partially  offset by a lower tax rate at Fairway View II Apartments  and a lower
assessed value at Patchen Place Apartments.

Total  revenues  decreased  slightly  due to a decrease  in rental  income and a
casualty  gain in 2001 at  Fairway  View II  Apartments  partially  offset by an
increase in other income. Rental income decreased due to a decrease in occupancy
at South Point and The Pines  Apartments  and decreased  average rental rates at
South  Point,  Patchan  Place and The Pines  Apartments  partially  offset by an
increase in occupancy at Patchen Place,  Northwoods I and II and Fairway View II
Apartments  and a decrease  in  concessions  at Fairway  View II and South Point
Apartments.  Other income increased due to increased  utility  reimbursements at
The Pines and Northwoods I and II Apartments,  increased cable television income
at Fairway View II, South Point,  Northwoods I and II, and The Pines Apartments,
and increased lease cancellation fees at Patchen Place, Northwoods I and II, and
The Pines Apartments.  These increases were partially offset by reduced interest
income at all of the  Partnership's  properties  as a result  of lower  interest
rates on average cash balances maintained in interest bearing accounts.

In June  2001,  Fairway  View II  Apartments  had wind and storm  damage  from a
tropical  storm which  affected 11 units.  Insurance  proceeds of  approximately
$96,000 were received  during the year ended December 31, 2001. The  Partnership
recognized a casualty gain of approximately  $87,000 for the year ended December
31, 2001 which represents the excess of the proceeds received as of December 31,
2001 over the write-off of the undepreciated destroyed assets.

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

Liquidity and Capital Resources

At  December  31,  2002,  the  Partnership  had  cash and  cash  equivalents  of
approximately  $614,000 as compared to  approximately  $912,000 at December  31,
2001. Cash and cash  equivalents  decreased by  approximately  $298,000 from the
Partnership's  year ended December 31, 2001 due to approximately  $2,228,000 and
$728,000  of cash used in  financing  and  investing  activities,  respectively,
partially  offset by  approximately  $2,658,000  of cash  provided by  operating
activities.  Cash used in financing  activities  consisted of  distributions  to
partners and, to a lesser  extent,  payments of principal  made on the mortgages
encumbering Fairway View II, The Pines and Northwoods I and II Apartments.  Cash
used in investing activities consisted of property improvements and replacements
and net  deposits to escrow  accounts  maintained  by the mortgage  lender.  The
Partnership invests its working capital reserves in interest bearing accounts.

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

The sufficiency of existing  liquid assets to meet future  liquidity and capital
expenditure   requirements   is  directly   related  to  the  level  of  capital
expenditures  required at the various  properties  to  adequately  maintain  the
physical  assets and other  operating needs of the Registrant and to comply with
Federal, state and local legal and regulatory requirements. The Managing General
Partner monitors developments in the area of legal and regulatory compliance and
is studying new federal laws,  including  the  Sarbanes-Oxley  Act of 2002.  The
Sarbanes-Oxley Act of 2002 mandates or suggests  additional  compliance measures
with regard to governance,  disclosure, audit and other areas. In light of these
changes,  the Partnership  expects that it will incur higher expenses related to
compliance,  including  increased  legal  and audit  fees.  The  Partnership  is
currently  evaluating  the capital  improvement  needs of the properties for the
upcoming year and currently expects to budget approximately  $337,000 for all of
the  Partnership's   investment  properties.   Additional  improvements  may  be
considered  during  2003  and  will  depend  on the  physical  condition  of the
properties as well as replacement  reserves and anticipated  cash flow generated
by the properties.  The additional capital expenditures will be incurred only if
cash is available from operations or from  Partnership  reserves.  To the extent
that  such  budgeted  capital  improvements  are  completed,   the  Registrant's
distributable cash flow, if any, may be adversely affected at least in the short
term.

On  August  31,  2001,  the  Partnership  refinanced  the  mortgage  encumbering
Northwoods  I and  II  Apartments.  The  refinancing  replaced  indebtedness  of
$5,000,000 with a new mortgage in the amount of $7,000,000. The interest rate on
the new mortgage is 7.06% as compared to 7.33% on the previous mortgage. The new
loan matures on  September  1, 2021,  requires  monthly  principal  and interest
payments and is scheduled to be fully amortized at maturity.  Total  capitalized
loan costs were approximately  $252,000 during the year ended December 31, 2001.
The  Partnership  recognized  a loss  on the  early  extinguishment  of  debt of
approximately $67,000 due to the write off of unamortized loan costs.

On November 30,  2001,  the  Partnership  refinanced  the  mortgage  encumbering
Fairway View II Apartments.  The refinancing replaced indebtedness of $4,200,000
with a new mortgage in the amount of  $5,430,000.  The interest  rate on the new
mortgage is 7.03% as compared to 7.33% on the  previous  mortgage.  The new loan
matures on December 1, 2021,  requires monthly  principal and interest  payments
and is scheduled to be fully amortized at maturity. In addition, the Partnership
was required to establish a repair  escrow of  approximately  $179,000  with the
lender for  certain  capital  replacements.  Total  capitalized  loan costs were
approximately  $181,000 during the year ended December 31, 2001. The Partnership
recognized a loss on the early  extinguishment of debt of approximately  $40,000
due to the write off of unamortized loan costs.

The  Registrant's  assets are thought to be sufficient  for any near-term  needs
(exclusive of capital improvements) of the Registrant. The mortgage indebtedness
of approximately $23,635,000 has maturity dates ranging from November 1, 2003 to
December 1, 2021. The mortgage  indebtedness of  approximately  $16,035,000 that
was refinanced  during 2000 and 2001 requires  monthly  payments until the loans
mature  between  January  2020 and  December  2021 at which  time the  loans are
scheduled to be fully amortized.  The Partnership's other mortgage  indebtedness
of $7,600,000 requires interest only payments with balloon payments due November
1, 2003. The Managing General Partner plans to refinance the indebtedness due to
mature in 2003 and/or sell the properties  prior to such maturity  dates. If the
properties cannot be refinanced or sold for a sufficient  amount, the Registrant
may risk losing such properties through foreclosure.

Pursuant to the Partnership Agreement,  the term of the Partnership is scheduled
to expire on December 31, 2008. Accordingly,  prior to such date the Partnership
will need to either  sell its  investment  properties  or extend the term of the
Partnership.

The  Partnership  distributed  the  following  amounts  during  the years  ended
December 31, 2002 and 2001 (in thousands, except per unit data):

<TABLE>
<CAPTION>

                            Year          Per Limited           Year          Per Limited
                           Ended          Partnership          Ended          Partnership
                     December 31, 2002        Unit       December 31, 2001       Unit

<S>                        <C>               <C>               <C>              <C>
Operations                 $1,584            $25.91            $1,133           $18.54
Refinancing                   242 (1)          3.97             2,386 (2)        39.03
                           $1,826            $29.88            $3,519           $57.57
</TABLE>

(1)   Distribution  from the remaining  proceeds from the refinancing of Fairway
      View II Apartments in November 2001.

(2)   Distribution  of refinancing  proceeds from Northwoods I and II Apartments
      in August 2001 and Fairway View II Apartments in November 2001.

Future cash  distributions  will depend on the levels of net cash generated from
operations, the availability of cash reserves and the timing of debt maturities,
refinancings  and/or  property  sales.  The  Partnership's  cash  available  for
distribution is reviewed on a monthly basis. There can be no assurance, however,
that the  Partnership  will  generate  sufficient  funds from  operations  after
required capital  expenditures,  to permit any  distributions to its partners in
2003 or subsequent periods.


<PAGE>


Other

In addition to its  indirect  ownership of the general  partner  interest in the
Partnership,  AIMCO and its affiliates owned 41,649.67 limited partnership units
(the "Units") in the Partnership representing 68.82% of the outstanding units at
December  31,  2002.  A number of these Units were  acquired  pursuant to tender
offers  made by  AIMCO  or its  affiliates.  It is  possible  that  AIMCO or its
affiliates will acquire additional Units of limited partnership  interest in the
Partnership  in  exchange  for cash or a  combination  of cash and  units in the
operating  partnership  of AIMCO  either  through  private  purchases  or tender
offers. Under the Partnership  Agreement,  unitholders holding a majority of the
Units are  entitled to take action  with  respect to a variety of matters  which
would  include  voting on certain  amendments to the  Partnership  Agreement and
voting to remove the Managing General  Partner.  As a result of its ownership of
68.82% of the outstanding  Units, AIMCO is in a position to influence all voting
decisions with respect to the Registrant.  Although the Managing General Partner
owes fiduciary duties to the limited  partners of the Partnership,  the Managing
General Partner also owes fiduciary duties to AIMCO as its sole stockholder.  As
a result,  the duties of the  Managing  General  Partner,  as  managing  general
partner, to the Partnership and its limited partners may come into conflict with
the duties of the Managing  General Partner to AIMCO,  as its sole  stockholder.
However,  DeForest  Ventures II L.P.,  from whom AIMCO,  through its merger with
Insignia,  acquired  25,399  Units  (41.97%  of the  units),  had agreed for the
benefit of non-tendering unit holders, that it would vote its Units: (i) against
any  increase in  compensation  payable to the  Managing  General  Partner or to
affiliates;  and (ii) on all other matters submitted by it or its affiliates, in
proportion  to the  votes  cast  by all  other  unit  holders.  Except  for  the
foregoing,  no other  limitations are imposed on AIMCO's or its affiliates right
to vote each unit acquired.

Critical Accounting Policies and Estimates

A summary of the Partnership's  significant  accounting  policies is included in
"Note A - Organization and Significant Accounting Policies" which is included in
the financial statements in "Item 7. Financial Statements". The Managing General
Partner  believes that the consistent  application of these policies enables the
Partnership  to provide  readers of the  financial  statements  with  useful and
reliable  information  about the  Partnership's  operating results and financial
condition. The preparation of financial statements in conformity with accounting
principles  generally  accepted in the United States requires the Partnership to
make  estimates and  assumptions.  These  estimates and  assumptions  affect the
reported  amounts  of  assets  and  liabilities  at the  date  of the  financial
statements  as well as reported  amounts of  revenues  and  expenses  during the
reporting  period.  Actual results could differ from these estimates.  Judgments
and  assessments  of  uncertainties  are required in applying the  Partnership's
accounting  policies  in  many  areas.  The  Partnership  believes  that  of its
significant  accounting  policies,  the following may involve a higher degree of
judgment and complexity.

Impairment of Long-Lived Assets

Investment  properties  are  recorded at cost,  less  accumulated  depreciation,
unless  considered  impaired.  If  events  or  circumstances  indicate  that the
carrying  amount of a property may be  impaired,  the  Partnership  will make an
assessment of its  recoverability  by estimating  the  undiscounted  future cash
flows,  excluding  interest  charges,  of the property.  If the carrying  amount
exceeds the aggregate  future cash flows,  the  Partnership  would  recognize an
impairment  loss to the extent the carrying amount exceeds the fair value of the
property.

Real  property  investments  are  subject  to varying  degrees of risk.  Several
factors  may  adversely  affect  the  economic  performance  and  value  of  the
Partnership's  investment  properties.  These  factors  include  changes  in the
national,  regional and local economic  climate;  local  conditions,  such as an
oversupply  of  multifamily   properties;   competition   from  other  available
multifamily  property  owners and changes in market  rental  rates.  Any adverse
changes in these factors could cause an impairment in the Partnership's assets.

Revenue Recognition

The Partnership generally leases apartment units for twelve-month terms or less.
Rental income  attributable to leases is recognized  monthly as it is earned and
the Partnership  fully reserves all balances  outstanding  over thirty days. The
Partnership will offer rental concessions during  particularly slow months or in
response  to  heavy  competition  from  other  similar  complexes  in the  area.
Concessions are charged to income as incurred.

Effective  April  1,  2002,  the  Partnership  adopted  Statement  of  Financial
Accounting  Standards ("SFAS") No. 145, "Rescission of FASB Statements No. 4, 44
and 64". SFAS No. 4 "Reporting  Gains and Losses from  Extinguishment  of Debt,"
required  that all gains and losses from  extinguishment  of debt be  aggregated
and, if material,  classified as an  extraordinary  item.  SFAS No. 145 rescinds
SFAS No. 4, and accordingly, gains and losses from extinguishment of debt should
only be  classified  as  extraordinary  if they are  unusual in nature and occur
infrequently. Neither of these criteria applies to the Partnership. As a result,
the   accompanying   statements  of   operations   reflect  the  loss  on  early
extinguishment  of debt at Fairway View I and  Northwoods I and II Apartments in
2001 (see "Item 7. Financial Statements" Note B) in operations rather than as an
extraordinary item.


<PAGE>


ITEM 7.     FINANCIAL STATEMENTS

NATIONAL PROPERTY INVESTORS 7

LIST OF FINANCIAL STATEMENTS

      Report of Ernst & Young LLP, Independent Auditors

      Balance Sheet - December 31, 2002

      Statements of Operations - Years ended December 31, 2002 and 2001

      Statements  of Changes in  Partners'  Deficit - Years ended  December 31,
         2002 and 2001

      Statements of Cash Flows - Years ended December 31, 2002 and 2001

      Notes to Financial Statements


<PAGE>


                 Report of Ernst & Young LLP, Independent Auditors



The Partners
National Property Investors 7


We have audited the accompanying  balance sheet of National Property Investors 7
as of December 31, 2002, and the related  statements of  operations,  changes in
partners' deficit,  and cash flows for each of the two years in the period ended
December 31, 2002.  These  financial  statements are the  responsibility  of the
Partnership's  management.  Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable  assurance about whether the financial  statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made  by the  Partnership's  management,  as  well  as  evaluating  the  overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the financial position of National Property Investors 7
at December 31, 2002,  and the results of its  operations and its cash flows for
each of the two years in the period ended December 31, 2002, in conformity  with
accounting principles generally accepted in the United States.

As  discussed in Note A to the  financial  statements,  in 2002 the  Partnership
adopted Statement of Financial Accounting Standards No. 145, "Rescission of FASB
Statements No. 4, 44 and 64." As a result, the accompanying financial statements
for 2001,  referred to above,  have been restated to conform to the presentation
adopted in 2002 in accordance with accounting  principles  generally accepted in
the United States.



                                                           /s/ERNST & YOUNG LLP



Greenville, South Carolina
February 14, 2003



<PAGE>






                          NATIONAL PROPERTY INVESTORS 7

                                  BALANCE SHEET
                        (in thousands, except unit data)

                                December 31, 2002

<TABLE>
<CAPTION>


Assets
<S>                                                                          <C>
   Cash and cash equivalents                                                 $   614
   Receivables and deposits                                                      225
   Restricted escrows                                                            616
   Other assets                                                                  588
   Investment properties (Notes B and E):
      Land                                                    $  3,738
      Buildings and related personal property                   45,753
                                                                49,491
      Less accumulated depreciation                            (33,658)       15,833

                                                                            $ 17,876
Liabilities and Partners' Deficit
Liabilities
   Accounts payable                                                           $ 77
   Tenant security deposit liabilities                                           132
   Other liabilities                                                             464
   Mortgage notes payable (Note B)                                            23,635

Partners' Deficit
   General partner                                             $ (366)
   Limited partners (60,517 units issued and
      outstanding)                                              (6,066)       (6,432)

                                                                            $ 17,876


                   See Accompanying Notes to Financial Statements
</TABLE>


<PAGE>


                          NATIONAL PROPERTY INVESTORS 7

                            STATEMENTS OF OPERATIONS
                      (in thousands, except per unit data)


<TABLE>
<CAPTION>

                                                               Years Ended December 31,
                                                                   2002         2001
                                                                             (Restated)
Revenues:
<S>                                                               <C>          <C>
   Rental income                                                  $ 7,167      $ 7,303
   Other income                                                       577          359
   Casualty gain (Note F)                                              --           87
      Total revenues                                                7,744        7,749

Expenses:
   Operating                                                        2,885        2,958
   General and administrative                                         425          454
   Depreciation                                                     2,085        2,047
   Interest                                                         1,805        1,703
   Property taxes                                                     470          428
   Loss on early extinguishment of debt (Note B)                       --          107
      Total expenses                                                7,670        7,697

Net income (Note C)                                                $   74         $ 52

Net income allocated to general partner (1%)                        $   1          $ 1

Net income allocated to limited partners (99%)                         73           51

                                                                   $   74         $ 52


Net income per limited partnership unit                            $ 1.21       $ 0.84

Distributions per limited partnership unit                        $ 29.88      $ 57.57

                   See Accompanying Notes to Financial Statements
</TABLE>



<PAGE>


                          NATIONAL PROPERTY INVESTORS 7

                   STATEMENTS OF CHANGES IN PARTNERS' DEFICIT
                        (in thousands, except unit data)

<TABLE>
<CAPTION>


                                         Limited
                                       Partnership    General     Limited
                                          Units       Partner    Partners     Total

<S>                                       <C>           <C>       <C>        <C>
Original capital contributions            60,517        $ 1       $30,259    $30,260

Partners' deficit at
  December 31, 2000                       60,517       $ (315)    $ (898)    $(1,213)

Distributions to partners                     --          (35)     (3,484)    (3,519)

Net income for the year ended
  December 31, 2001                           --            1          51         52

Partners' deficit at
  December 31, 2001                       60,517         (349)     (4,331)    (4,680)

Distributions to partners                     --          (18)     (1,808)    (1,826)

Net income for the year ended
  December 31, 2002                           --            1          73         74

Partners' deficit at
  December 31, 2002                       60,517       $ (366)    $(6,066)   $(6,432)

                   See Accompanying Notes to Financial Statements
</TABLE>

<PAGE>


                          NATIONAL PROPERTY INVESTORS 7

                            STATEMENTS OF CASH FLOWS
                                 (in thousands)
<TABLE>
<CAPTION>

                                                             Years Ended December 31,
                                                                 2002         2001
Cash flows from operating activities:
<S>                                                              <C>          <C>
  Net income                                                     $ 74         $ 52
  Adjustments to reconcile net income to net
   cash provided by operating activities:
   Depreciation                                                   2,085        2,047
   Amortization of loan costs                                        68           95
   Casualty gain                                                     --          (87)
   Loss on early extinguishment of debt                              --          107
   Change in accounts:
      Receivables and deposits                                      204         (232)
      Other assets                                                   35           (8)
      Accounts payable                                              (32)         (33)
      Tenant security deposit liabilities                            24            8
      Accrued property taxes                                         --          (52)
      Other liabilities                                             200          (23)

          Net cash provided by operating activities               2,658        1,874

Cash flows from investing activities:
  Property improvements and replacements                           (651)        (901)
  Net deposits to restricted escrows                                (77)        (162)
  Insurance proceeds received                                        --           96

          Net cash used in investing activities                    (728)        (967)

Cash flows from financing activities:
  Payments on mortgage notes payable                               (402)        (136)
  Repayment of mortgage notes payable                                --       (9,200)
  Proceeds from mortgage notes payable                               --       12,430
  Loan costs paid                                                    --         (441)
  Distributions to partners                                      (1,826)      (3,519)

          Net cash used in financing activities                  (2,228)        (866)

Net (decrease) increase in cash and cash equivalents               (298)          41

Cash and cash equivalents at beginning of year                      912          871

Cash and cash equivalents at end of year                         $ 614        $ 912

Supplemental disclosure of cash flow information:
  Cash paid for interest                                        $ 1,739      $ 1,592


                   See Accompanying Notes to Financial Statements
</TABLE>

<PAGE>

                          NATIONAL PROPERTY INVESTORS 7

                          NOTES TO FINANCIAL STATEMENTS

                                December 31, 2002


Note A - Organization and Significant Accounting Policies

Organization:  National Property Investors 7 (the "Partnership" or "Registrant")
is a  California  limited  partnership  organized in October 1983 to acquire and
operate  residential  apartment  complexes.  The Partnership's  managing general
partner is NPI Equity  Investments,  Inc. ("NPI Equity" or the "Managing General
Partner"). NPI Equity was a wholly owned subsidiary of Insignia Properties Trust
("IPT").  On February 26, 1999,  IPT was merged into  Apartment  Investment  and
Management  Company  ("AIMCO"),  a publicly traded real estate investment trust.
The  directors  and  officers  of the  Managing  General  Partner  also serve as
executive  officers  of  AIMCO.  The  Partnership  Agreement  provides  that the
Partnership will terminate on December 31, 2008, unless terminated prior to such
date.  As of December  31,  2002,  the  Partnership  operates  five  residential
apartment complexes located throughout the southeastern United States.

Allocation of Profits,  Gains,  and Losses:  Profits,  gains,  and losses of the
Partnership are allocated between the general and limited partners in accordance
with the provisions of the Partnership Agreement.

Profits,  not including  gains from property  dispositions,  are allocated as if
they were distributions of net cash from operations.

Any gain from property  dispositions  attributable to the excess, if any, of the
indebtedness relating to a property immediately prior to the disposition of such
property  over  the  Partnership's  adjusted  basis  in the  property  shall  be
allocated to each partner  having a negative  capital  account  balance,  to the
extent of such negative  balance.  The balance of any gain shall be treated on a
cumulative basis as if it constituted an equivalent  amount of distributable net
proceeds and shall be  allocated  to the general  partner to the extent that the
general  partner  would have received  distributable  net proceeds in connection
therewith; the balance shall be allocated to the limited partners.  However, the
interest of the general partner will be equal to at least 1% of each gain at all
times during the existence of the Partnership.

All  losses,  including  losses  attributable  to  property  dispositions,   are
allocated 99% to the limited partners and 1% to the general partner.

Accordingly,  net income as shown in the statements of operations and changes in
partner's  deficit for 2002 and 2001 was allocated  99% to the limited  partners
and 1% to the general partner.  Net income per limited partnership unit for each
such year was computed as 99% of net income divided by 60,517 units outstanding.

Cash and Cash Equivalents: Cash and cash equivalents include cash on hand and in
banks.  At certain times,  the amount of cash deposited at a bank may exceed the
limit on insured  deposits.  Cash  balances  include  approximately  $543,000 at
December 31, 2002 that are  maintained  by an affiliated  management  company on
behalf of affiliated entities in cash concentration accounts.

Leases: The Partnership  generally leases apartment units for twelve-month terms
or less.  The  Partnership  recognizes  income as earned on its  leases  and the
Partnership  fully  reserves  all  balances  outstanding  over thirty  days.  In
addition,  the Managing General Partner's policy is to offer rental  concessions
during periods of declining  occupancy or in response to heavy  competition from
other similar  complexes in the area.  Concessions  are charged  against  rental
income as incurred.

Tenant  Security  Deposits:  The  Partnership  requires  security  deposits from
lessees  for the  duration  of the  lease  and such  deposits  are  included  in
receivables  and  deposits.  Deposits  are  refunded  when the  tenant  vacates,
provided  the  tenant  has not  damaged  its space and is  current on its rental
payments.

Restricted Escrows:

      Capital  Reserve:   At  the  time  of  the  refinancing  of  the  mortgage
      encumbering Fairway View II Apartments during 2001, approximately $179,000
      of the proceeds  were  designated  for certain  capital  improvements.  At
      December  31,  2002,  the escrow  balance is  unchanged  at  approximately
      $179,000.

      Replacement  Reserve:  A replacement  reserve  account is  maintained  for
      Patchen Place  Apartments and Southpoint  Apartments.  Each property has a
      required  monthly  payment  into its account to cover the costs of capital
      improvements and  replacements.  The balance of these accounts at December
      31, 2002, is approximately $437,000 which includes interest.

Loan Costs: Loan costs of approximately $815,000, less accumulated  amortization
of approximately  $290,000, are included in other assets and are being amortized
over the  lives of the  related  loans.  The  related  amortization  expense  is
included  in  interest   expense.   Amortization   expense  is  expected  to  be
approximately  $66,000 in 2003,  approximately  $34,000  in 2004,  approximately
$33,000 in 2005, and approximately $32,000 in 2006 and 2007.

Investment Properties: Investment properties consist of five apartment complexes
and are  stated  at cost.  Acquisition  fees are  capitalized  as a cost of real
estate. Expenditures in excess of $250 that maintain an existing asset which has
a useful  life of more  than one year are  capitalized  as  capital  replacement
expenditures  and  depreciated  over the  estimated  useful  life of the  asset.
Expenditures for ordinary repairs,  maintenance and apartment turnover costs are
expensed as incurred.  In  accordance  with  Statement  of Financial  Accounting
Standards  ("SFAS")  No.  144,  "Accounting  for the  Impairment  or Disposal of
Long-Lived  Assets",  the Partnership  records  impairment  losses on long-lived
assets used in operations when events and circumstances indicate that the assets
might be impaired and the  undiscounted  cash flows estimated to be generated by
those assets are less than the carrying amounts of those assets.  No adjustments
for  impairment of value were  recorded in the years ended  December 31, 2002 or
2001.

During 2001, AIMCO, an affiliate of the General Partner,  commissioned a project
to study process  improvement ideas to reduce operating costs. The result of the
study led to a re-engineering of business processes and eventual redeployment of
personnel and related capital spending. The implementation of these plans during
2002, accounted for as a change in accounting estimate, resulted in a refinement
of the  Partnership's  process  for  capitalizing  certain  direct and  indirect
project costs (principally  payroll related costs) and increased  capitalization
of such costs by approximately $98,000 in 2002 compared to 2001.

Depreciation:  Depreciation  is  provided by the  straight-line  method over the
estimated lives of the apartment  properties and related personal property.  For
Federal income tax purposes,  the  accelerated  cost recovery method is used for
real property over 18 years for additions after March 15, 1984 and before May 9,
1985, and 19 years for additions  after May 8, 1985, and before January 1, 1987.
As a result of the Tax Reform Act of 1986,  for  additions  after  December  31,
1986, the modified  accelerated cost recovery method is used for depreciation of
(1) real property over 27 1/2 years and (2) personal  property  additions over 5
years.

Fair Value of Financial  Statements:  Statement of Financial Accounting Standard
("SFAS") No. 107,  "Disclosures about Fair Value of Financial  Instruments",  as
amended by SFAS No. 119, "Disclosures about Derivative Financial Instruments and
Fair  Value  of  Financial  Instruments",  requires  disclosure  of  fair  value
information  about  financial  instruments,  whether  or not  recognized  in the
balance sheet, for which it is practicable to estimate fair value. Fair value is
defined in the SFAS as the amount at which the instruments could be exchanged in
a  current  transaction  between  willing  parties,  other  than in a forced  or
liquidation  sale.  The  Partnership  believes that the carrying  amounts of its
financial  instruments (except for long term debt) approximate their fair values
due to the short  term  maturity  of these  instruments.  The fair  value of the
Partnership's  long  term  debt at  December  31,  2002  after  discounting  the
scheduled loan payments to maturity, approximates its carrying balance.

Segment Reporting: SFAS No. 131, "Disclosure about Segments of an Enterprise and
Related  Information"  established  standards  for the way that public  business
enterprises  report  information  about operating  segments in annual  financial
statements and requires that those enterprises report selected information about
operating segments in interim financial reports.  It also established  standards
for related disclosures about products and services, geographic areas, and major
customers.  As defined in SFAS No. 131, the  Partnership has only one reportable
segment.

Use of Estimates:  The  preparation of financial  statements in conformity  with
accounting   principles   generally  accepted  in  the  United  States  requires
management to make estimates and assumptions that affect the amounts reported in
the financial  statements and  accompanying  notes.  Actual results could differ
from those estimates.

Advertising:  The  Partnership  expenses the costs of  advertising  as incurred.
Advertising  costs of  approximately  $99,000  and  $84,000  for the years ended
December 31, 2002 and 2001, respectively, were charged to operating expense.

Recent  Accounting  Pronouncements:  In August 2001,  the  Financial  Accounting
Standards Board issued SFAS No. 144,  "Accounting for the Impairment or Disposal
of Long-Lived  Assets".  SFAS No. 144 provides accounting guidance for financial
accounting  and reporting for the  impairment or disposal of long-lived  assets.
SFAS No.  144  supersedes  SFAS  No.  121,  "Accounting  for the  Impairment  of
Long-Lived  Assets and for Long-Lived Assets to be Disposed Of". SFAS No. 144 is
effective for fiscal years  beginning  after December 15, 2001. The  Partnership
adopted SFAS No. 144  effective  January 31,  2002.  Its adoption did not have a
material  effect on the  financial  position  or  results of  operations  of the
Partnership.

Effective  April  1,  2002,  the  Partnership  adopted  Statement  of  Financial
Accounting  Standards ("SFAS") No. 145, "Rescission of FASB Statements No. 4, 44
and 64". SFAS No. 4 "Reporting  Gains and Losses from  Extinguishment  of Debt,"
required  that all gains and losses from  extinguishment  of debt be  aggregated
and, if material,  classified as an  extraordinary  item.  SFAS No. 145 rescinds
SFAS No. 4, and accordingly, gains and losses from extinguishment of debt should
only be  classified  as  extraordinary  if they are  unusual in nature and occur
infrequently. Neither of these criteria applies to the Partnership. As a result,
the accompanying statements of operations have been restated to reflect the loss
on early  extinguishment  of debt at Northwoods I and II Apartments in 2001 (see
"Note B") in operations rather than as an extraordinary item.

Note B - Mortgage Notes Payable

<TABLE>
<CAPTION>

                        Principal     Monthly                              Principal
                       Balance At     Payment      Stated                   Balance
                      December 31,   Including    Interest    Maturity      Due At
Property                  2002        Interest      Rate        Date       Maturity
                            (in thousands)                              (in thousands)

<S>                      <C>            <C>         <C>       <C>   <C>      <C>
Fairway View II          $ 5,301        $ 42        7.03%     12/01/21      $    --
The Pines                  3,942          35        7.97%     01/01/20           --
Patchen Place (1)          3,000          18        7.33%     11/01/03        3,000
Northwoods I & II          6,792          55        7.06%     09/01/21           --
South Point (1)            4,600          28        7.33%     11/01/03        4,600
        Total            $23,635       $ 178                                $ 7,600
</TABLE>

(1)   The mortgages encumbering Patchen Place and South Point Apartments require
      interest-only payments.

The mortgage  notes  payable are  non-recourse  and are secured by pledge of the
respective  apartment  properties  and by pledge of revenues from the respective
apartment properties.  The notes require prepayment penalties if repaid prior to
maturity and prohibit resale of the properties subject to existing indebtedness.

On  August  31,  2001,  the  Partnership  refinanced  the  mortgage  encumbering
Northwoods  I and  II  Apartments.  The  refinancing  replaced  indebtedness  of
$5,000,000 with a new mortgage in the amount of $7,000,000. The interest rate on
the new mortgage is 7.06% as compared to 7.33% on the previous mortgage. The new
loan matures on  September  1, 2021,  requires  monthly  principal  and interest
payments and is scheduled to be fully amortized at maturity.  Total  capitalized
loan costs were approximately  $252,000 during the year ended December 31, 2001.
The  Partnership  recognized  a loss  on the  early  extinguishment  of  debt of
approximately $67,000 due to the write off of unamortized loan costs.

On November 30,  2001,  the  Partnership  refinanced  the  mortgage  encumbering
Fairway View II Apartments.  The refinancing replaced indebtedness of $4,200,000
with a new mortgage in the amount of  $5,430,000.  The interest  rate on the new
mortgage is 7.03% as compared to 7.33% on the  previous  mortgage.  The new loan
matures on December 1, 2021,  requires monthly  principal and interest  payments
and is scheduled to be fully amortized at maturity. In addition, the Partnership
was required to establish a repair  escrow of  approximately  $179,000  with the
lender for  certain  capital  replacements.  Total  capitalized  loan costs were
approximately  $181,000 during the year ended December 31, 2001. The Partnership
recognized a loss on the early  extinguishment of debt of approximately  $40,000
due to the write off of unamortized loan costs.

Scheduled  principal  payments  of the  mortgage  notes  payable  subsequent  to
December 31, 2002 are as follows (in thousands):

                               2003             $ 8,032
                               2004                 464
                               2005                 499
                               2006                 537
                               2007                 577
                            Thereafter           13,526

                               Total            $23,635

Note C - Income Taxes

The Partnership has received a ruling from the Internal  Revenue Service that it
will  be  classified  as  a  partnership   for  Federal   income  tax  purposes.
Accordingly,  no provision for income taxes is made in the financial  statements
of the Partnership. Taxable income or loss of the Partnership is reported in the
income tax returns of its partners.

The  following is a  reconciliation  of reported net income and Federal  taxable
income (in thousands, except per unit data):

                                              2002         2001
Net income as reported                        $ 74         $ 52
Add (deduct):
  Depreciation differences                      155           84
  Other                                         135          (18)

Federal taxable income                        $ 364        $ 118

Federal taxable income per
  limited partnership unit                   $ 5.95       $ 1.93

The following is a reconciliation between the Partnership's reported amounts and
Federal tax basis of net assets and liabilities (in thousands):

                                                 2002
Net liabilities as reported                    $ (6,432)
Land and buildings                              (1,564)
Accumulated depreciation                        (6,702)
Syndication and distribution costs               3,555
Prepaid rent                                        52
Other                                              328

Net liabilities - Federal tax basis           $(10,763)

Note D - Transactions with Affiliated Parties

The  Partnership  has no employees  and is  dependent  on the  Managing  General
Partner  and  its  affiliates  for  the  management  and  administration  of all
Partnership  activities.  The  Partnership  Agreement  provides  for payments to
affiliates for services and as  reimbursement  of certain  expenses  incurred by
affiliates on behalf of the Partnership.

During the years ended  December 31, 2002 and 2001,  affiliates  of the Managing
General  Partner were  entitled to receive 5% of gross  receipts from all of the
Partnership's  properties  as  compensation  for providing  property  management
services.  The Registrant  paid to such  affiliates  approximately  $373,000 and
$379,000 for the years ended December 31, 2002 and 2001, respectively,  which is
included in operating expenses.

An  affiliate  of  the  Managing  General  Partner  received   reimbursement  of
accountable  administrative  expenses  amounting to  approximately  $254,000 and
$539,000 for the years ended December 31, 2002 and 2001, respectively, which are
included in general  and  administrative  expenses  and  investment  properties.
Included in these amounts are fees related to construction  management  services
provided  by an  affiliate  of the  Managing  General  Partner of  approximately
$26,000  and  $269,000  for  the  years  ended   December  31,  2002  and  2001,
respectively. The construction management service fees are calculated based on a
percentage of current year additions to investment properties.

In connection with the refinancing of the mortgage loans encumbering  Northwoods
I and II  and  Fairway  View  Apartments,  the  Partnership  paid  approximately
$124,000 in loan costs to an affiliate  during the year ended December 31, 2001.
No such loan costs were paid in 2002.  These  loan costs were  capitalized,  are
included in other assets and are amortized as interest  expense over the term of
the loans.

For services relating to the  administration of the Partnership and operation of
Partnership  properties,  the  Managing  General  Partner is entitled to receive
payment for  non-accountable  expenses up to a maximum of $150,000 per year from
distributions from operations,  based upon the number of Partnership units sold,
subject  to  certain   limitations.   The  Managing   General  Partner  received
approximately  $91,000  in  such  reimbursements  for  both of the  years  ended
December  31,  2002 and 2001,  respectively,  which is  included  in general and
administrative expenses.

For managing the affairs of the Partnership, the Managing General Partner of the
Partnership  is entitled to receive a  partnership  management  fee.  The fee is
equal to 4% of the  Partnership's  adjusted cash from operations,  as defined in
the Partnership  Agreement,  in any year, provided that 50% of the fee shall not
be paid until the Partnership has distributed to the limited  partners  adjusted
cash from operations in such year which is equal to 5% of the limited  partners'
adjusted invested capital, as defined,  on a non-cumulative  basis. In addition,
50% of the fee shall not be paid until the  Partnership  has  distributed to the
limited partners adjusted cash from operations in such year which is equal to 8%
of the limited partners'  adjusted  invested capital on a non-cumulative  basis.
The fee shall be paid when adjusted cash from  operations is  distributed to the
limited partners.  The Managing General Partner earned approximately $33,000 for
such fees during the year ended December 31, 2002. The Managing  General Partner
was not entitled to receive this fee during the year ended December 31, 2001.

Upon the sale of the Partnership's properties, NPI Equity will be entitled to an
incentive  compensation  fee equal to a declining  percentage of the  difference
between the total amount distributed to limited partners and the appraised value
of their investment at February 1, 1992. The percentage amount to be realized by
NPI Equity,  if any,  will be  dependent  upon the year in which the property is
sold.  Payment of the incentive  compensation fee is subordinated to the receipt
by the limited partners, of: (a) distributions from capital transaction proceeds
of an amount equal to their appraised  investment in the Partnership at February
1, 1992; and (b) distributions from all sources (capital transactions as well as
cash  flow)  of an  amount  equal to six  percent  (6%)  per  annum  cumulative,
non-compounded,  on their present  appraised  investment in the  Partnership  at
February 1, 1992.

The Managing General Partner has extended to the Partnership a line of credit of
up to $500,000.  Loans under the line of credit will have a term of 365 days, be
unsecured  and bear  interest at the rate of 2% per annum in excess of the prime
rate announced from time to time by Chase Manhattan Bank, N.A. The maturity date
of such  borrowing  will be  accelerated in the event of: (i) the removal of the
Managing  General  Partner  (whether  or  not  For  Cause);  (ii)  the  sale  or
refinancing of a property by the  Partnership;  or (iii) the  liquidation of the
Partnership. At the present time, the Partnership has no outstanding amounts due
under this line of credit.

Beginning in 2001, the  Partnership  began insuring its properties up to certain
limits through coverage provided by AIMCO which is generally  self-insured for a
portion of losses and  liabilities  related  to workers  compensation,  property
casualty and vehicle liability. The Partnership insures its properties above the
AIMCO  limits  through  insurance  policies  obtained  by  AIMCO  from  insurers
unaffiliated with the Managing General Partner.  During the years ended December
31,  2002 and 2001,  the  Partnership  was  charged by AIMCO and its  affiliates
approximately $78,000 and $70,000, respectively, for insurance coverage and fees
associated with policy claims administration.

In addition to its  indirect  ownership of the general  partner  interest in the
Partnership,  AIMCO and its affiliates owned 41,649.67 limited partnership units
(the "Units") in the Partnership representing 68.82% of the outstanding units at
December  31,  2002.  A number of these Units were  acquired  pursuant to tender
offers  made by  AIMCO  or its  affiliates.  It is  possible  that  AIMCO or its
affiliates will acquire additional Units of limited partnership  interest in the
Partnership  in  exchange  for cash or a  combination  of cash and  units in the
operating  partnership  of AIMCO  either  through  private  purchases  or tender
offers. Under the Partnership  Agreement,  unitholders holding a majority of the
Units are  entitled to take action  with  respect to a variety of matters  which
would  include  voting on certain  amendments to the  Partnership  Agreement and
voting to remove the Managing General  Partner.  As a result of its ownership of
68.82% of the outstanding  Units, AIMCO is in a position to influence all voting
decisions with respect to the Registrant.  Although the Managing General Partner
owes fiduciary duties to the limited  partners of the Partnership,  the Managing
General Partner also owes fiduciary duties to AIMCO as its sole stockholder.  As
a result,  the duties of the  Managing  General  Partner,  as  managing  general
partner, to the Partnership and its limited partners may come into conflict with
the duties of the Managing  General Partner to AIMCO,  as its sole  stockholder.
However,  DeForest  Ventures II L.P.,  from whom AIMCO,  through its merger with
Insignia,  acquired  25,399  Units  (41.97%  of the  units),  had agreed for the
benefit of non-tendering unit holders, that it would vote its Units: (i) against
any  increase in  compensation  payable to the  Managing  General  Partner or to
affiliates;  and (ii) on all other matters submitted by it or its affiliates, in
proportion  to the  votes  cast  by all  other  unit  holders.  Except  for  the
foregoing,  no other  limitations are imposed on AIMCO's or its affiliates right
to vote each unit acquired.

Note E - Real Estate and Accumulated Depreciation

                                              Initial Cost
                                             To Partnership
                                             (in thousands)
<TABLE>
<CAPTION>

                                                      Buildings           Cost
                                                     and Related       Capitalized
                                                       Personal       Subsequent to
Description             Encumbrances       Land        Property        Acquisition
                       (in thousands)                                (in thousands)

<S>                       <C>            <C>           <C>               <C>
Fairway View II           $ 5,301        $ 1,086       $ 8,788           $ 1,062
The Pines                   3,942            579         6,521             1,593
Patchen Place               3,000            706         6,409             2,287
Northwoods I & II           6,792            478         7,919             2,308
South Point                 4,600            859         7,686             1,210
Totals                    $23,635        $ 3,708       $37,323           $ 8,460
</TABLE>


<TABLE>
<CAPTION>

                      Gross Amount at Which
                             Carried
                        At December 31, 2002
                          (in thousands)
                            Buildings
                           And Related
                            Personal            Accumulated     Year of      Date    Depreciable
Description         Land    Property    Total   Depreciation  Construction Acquired  Life-Years
                                               (in thousands)
<S>                <C>       <C>       <C>        <C>             <C>        <C>        <C>
Fairway View II    $ 1,094   $ 9,842   $10,936    $ 6,785         1981       11/84      5-30
The Pines              584     8,109     8,693      6,182         1978       04/85      5-30
Patchen Place          714     8,688     9,402      7,230         1971       07/85      5-30
Northwoods I & II      483    10,222    10,705      7,055         1981       07/85      5-30
South Point            863     8,892     9,755      6,406         1980       03/86      5-30
Total              $ 3,738   $45,753   $49,491    $33,658

Reconciliation of "real estate and accumulated depreciation":
</TABLE>

                                               Years Ended December 31,
                                                   2002         2001
                                                    (in thousands)
Investment Properties
Balance at beginning of year                     $48,840      $47,996
  Property improvements                              651          901
  Property dispositions from casualty                 --          (57)
Balance at end of year                           $49,491      $48,840

Accumulated Depreciation
Balance at beginning of year                     $31,573      $29,574
  Additions charged to expense                     2,085        2,047
  Property dispositions from casualty                 --          (48)
Balance at end of year                           $33,658      $31,573

The  aggregate  cost of the real  estate  for  Federal  income tax  purposes  at
December  31,  2002 and 2001,  is  approximately  $47,942,000  and  $47,291,000,
respectively. The accumulated depreciation taken for Federal income tax purposes
at December 31, 2002 and 2001, is  approximately  $40,360,000  and  $38,430,000,
respectively.

Note F - Casualty Gain

In June  2001,  Fairway  View II  Apartments  had wind and storm  damage  from a
tropical  storm which  affected 11 units.  Insurance  proceeds of  approximately
$96,000 were received  during the year ended December 31, 2001. The  Partnership
recognized a casualty gain of approximately  $87,000 for the year ended December
31, 2001 which represents the excess of the proceeds received as of December 31,
2001 over the write-off of the undepreciated destroyed assets.

<PAGE>

Note G - Legal Proceedings

In March 1998, several putative unit holders of limited partnership units of the
Partnership  commenced an action  entitled  Rosalie  Nuanes,  et al. v. Insignia
Financial Group, Inc., et al. (the "Nuanes action") in the Superior Court of the
State of  California  for the  County  of San  Mateo.  The  plaintiffs  named as
defendants,  among others,  the  Partnership,  its Managing  General Partner and
several of their  affiliated  partnerships  and corporate  entities.  The action
purports  to  assert  claims  on  behalf  of a class  of  limited  partners  and
derivatively  on behalf  of a number  of  limited  partnerships  (including  the
Partnership)  which are named as nominal  defendants,  challenging,  among other
things,  the  acquisition  of  interests  in certain  Managing  General  Partner
entities by Insignia Financial Group, Inc. ("Insignia") and entities which were,
at one  time,  affiliates  of  Insignia;  past  tender  offers  by the  Insignia
affiliates to acquire limited partnership units;  management of the partnerships
by the  Insignia  affiliates;  and the series of  transactions  which  closed on
October 1, 1998 and February 26, 1999 whereby  Insignia and Insignia  Properties
Trust,  respectively,  were merged  into AIMCO.  The  plaintiffs  seek  monetary
damages and equitable relief, including judicial dissolution of the Partnership.
On June 25, 1998, the Managing General Partner filed a motion seeking  dismissal
of the action.  In lieu of responding  to the motion,  the  plaintiffs  filed an
amended  complaint.  The Managing General Partner filed demurrers to the amended
complaint which were heard February 1999.

Pending the ruling on such  demurrers,  settlement  negotiations  commenced.  On
November 2, 1999,  the parties  executed and filed a Stipulation  of Settlement,
settling claims, subject to court approval, on behalf of the Partnership and all
limited partners who owned units as of November 3, 1999. Preliminary approval of
the  settlement  was obtained on November 3, 1999 from the Court,  at which time
the Court set a final  approval  hearing for  December  10,  1999.  Prior to the
December  10,  1999  hearing,  the  Court  received  various  objections  to the
settlement, including a challenge to the Court's preliminary approval based upon
the alleged lack of authority of prior lead counsel to enter the settlement.  On
December 14, 1999, the Managing  General  Partner and its affiliates  terminated
the  proposed  settlement.  In  February  2000,  counsel  for some of the  named
plaintiffs filed a motion to disqualify plaintiff's lead and liaison counsel who
negotiated  the  settlement.  On June  27,  2000,  the  Court  entered  an order
disqualifying  them  from the case and an  appeal  was  taken  from the order on
October 5, 2000. On December 4, 2000, the Court  appointed the law firm of Lieff
Cabraser  Heimann & Bernstein  LLP as new lead  counsel for  plaintiffs  and the
putative class.  Plaintiffs filed a third amended complaint on January 19, 2001.
On March 2, 2001,  the  Managing  General  Partner  and its  affiliates  filed a
demurrer to the third amended  complaint.  On May 14, 2001,  the Court heard the
demurrer to the third amended  complaint.  On July 10, 2001, the Court issued an
order  sustaining  defendants'  demurrer on certain  grounds.  On July 20, 2001,
Plaintiffs filed a motion for reconsideration of the Court's July 10, 2001 order
granting in part and denying in part defendants' demurrer. On September 7, 2001,
Plaintiffs  filed a fourth amended class and  derivative  action  complaint.  On
September 12, 2001, the Court denied Plaintiffs' motion for reconsideration.  On
October 5, 2001, the Managing General Partner and affiliated  defendants filed a
demurrer to the fourth amended complaint,  which was heard on December 11, 2001.
On February 2, 2002,  the Court served its order  granting in part the demurrer.
The  Court has  dismissed  without  leave to amend  certain  of the  plaintiffs'
claims.  On February 11, 2002,  plaintiffs  filed a motion  seeking to certify a
putative  class  comprised of all  non-affiliated  persons who own or have owned
units  in  the  partnerships.   The  Managing  General  Partner  and  affiliated
defendants  oppose the motion.  On April 29,  2002,  the Court held a hearing on
plaintiffs' motion for class  certification and took the matter under submission
after further  briefing,  as ordered by the court, was submitted by the parties.
On July 10, 2002,  the Court entered an order vacating the current trial date of
January 13, 2003 (as well as the  pre-trial  and  discovery  cut-off  dates) and
stayed the case in its  entirety  through  November  7, 2002 so that the parties
could have an opportunity to discuss settlement.  On October 30, 2002, the court
entered an order extending the stay in effect through January 10, 2003.

On January 8, 2003,  the parties filed a  Stipulation  of Settlement in proposed
settlement of the Nuanes action and the Heller action described below. The Court
has  scheduled  the hearing on  preliminary  approval  for April 4, 2003 and the
hearing on final approval for June 2, 2003.

In general  terms,  the  proposed  settlement  provides  for  certification  for
settlement  purposes of a settlement class consisting of all limited partners in
this  Partnership and others (the  "Partnerships")  as of December 20, 2002, the
dismissal  with  prejudice  and  release  of claims  in the  Nuanes  and  Heller
litigation,  payment by AIMCO of $9.9  million  (which shall be  distributed  to
settlement  class  members  after  deduction of attorney fees and costs of class
counsel and certain costs of  settlement)  and up to $ 1 million toward the cost
of independent  appraisals of the Partnerships'  properties by a Court appointed
appraiser.  An affiliate of the Managing General Partner has also agreed to make
a tender offer to purchase all of the partnership  interests in the Partnerships
within one year of final  approval,  if it is granted,  and to provide  partners
with the  independent  appraisals  at the time of these  tenders.  The  proposed
settlement  also provides for the  limitation  of the allowable  costs which the
Managing  General  Partner or its  affiliates  will charge the  Partnerships  in
connection with this litigation and imposes limits on the class counsel fees and
costs in this  litigation.  If the  Court  grants  preliminary  approval  of the
proposed settlement in March, a notice will be distributed to partners providing
detail on the terms of the proposed settlement.

During the third  quarter of 2001, a complaint  (the "Heller  action") was filed
against  the same  defendants  that are named in the  Nuanes  action,  captioned
Heller v. Insignia Financial Group. On or about August 6, 2001, plaintiffs filed
a first amended  complaint.  The first amended complaint in the Heller action is
brought as a purported  derivative  action,  and asserts  claims for among other
things  breach  of  fiduciary  duty;  unfair  competition;   conversion,  unjust
enrichment;  and judicial  dissolution.  Plaintiffs in the Nuanes action filed a
motion to  consolidate  the Heller action with the Nuanes action and stated that
the Heller action was filed in order to preserve the derivative claims that were
dismissed  without  leave to amend in the Nuanes action by the Court order dated
July 10, 2001. On October 5, 2001, the Managing  General  Partner and affiliated
defendants  moved to strike the first  amended  complaint  in its  entirety  for
violating  the Court's July 10, 2001 order  granting in part and denying in part
defendants'  demurrer in the Nuanes action, or alternatively,  to strike certain
portions of the complaint based on the statute of limitations.  Other defendants
in the action  demurred to the fourth  amended  complaint,  and,  alternatively,
moved to strike the complaint. On December 11, 2001, the court heard argument on
the motions  and took the matters  under  submission.  On February 4, 2002,  the
Court  served  notice of its order  granting  defendants'  motion to strike  the
Heller complaint as a violation of its July 10, 2001 order in the Nuanes action.
On March 27, 2002,  the plaintiffs  filed a notice  appealing the order striking
the complaint.

Before completing briefing on the appeal, the parties stayed further proceedings
in the appeal pending the Court's review of the terms of the proposed settlement
described above.

The  Managing  General  Partner  does  not  anticipate  that  any  costs  to the
Partnership, whether legal or settlement costs, associated with these cases will
be material to the Partnership's overall operations.

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

<PAGE>

Item 8.     Changes in and Disagreements with  Accountants  on  Accounting  and
            Financial Disclosures

            None.


<PAGE>




                                    PART III

Item 9.     Directors, Executive Officers, Promoters and  Control   Persons;
            Compliance with Section 16(a) of the Exchange Act

National  Property  Investors 7 (the  "Partnership" or the  "Registrant") has no
officers or directors.  The managing  general  partner of the Partnership is NPI
Equity Investments,  Inc. ("NPI Equity" or the "Managing General Partner").  The
present  executive  officers and directors of the Managing  General  Partner are
listed below:

Name                        Age    Position

Patrick J. Foye              45    Executive Vice President and Director
Paul J. McAuliffe            46    Executive Vice President and Chief
                                     Financial Officer
Thomas C. Novosel            44    Senior Vice President and Chief Accounting
                                     Officer

Patrick J. Foye has been  Executive  Vice President and Director of the Managing
General  Partner  since October 1, 1998.  Mr. Foye has served as Executive  Vice
President  of AIMCO  since  May 1998,  where he is  responsible  for  continuous
improvement,  acquisitions of partnership securities,  consolidation of minority
interests,  and corporate and other  acquisitions.  Prior to joining AIMCO,  Mr.
Foye was a Merger and  Acquisitions  Partner in the law firm of  Skadden,  Arps,
Slate, Meagher & Flom LLP from 1989 to 1998.

Paul J. McAuliffe has been Executive Vice President and Chief Financial  Officer
of the Managing General Partner since April 1, 2002. Mr. McAuliffe has served as
Executive  Vice  President  of AIMCO  since  February  1999 and Chief  Financial
Officer of AIMCO since  October 1999.  From May 1996 until he joined AIMCO,  Mr.
McAuliffe was Senior Managing Director of Secured Capital Corp.

Thomas C. Novosel has been Senior Vice President and Chief Accounting Officer of
the Managing  General  Partner  since April 1, 2002.  Mr.  Novosel has served as
Senior Vice  President and Chief  Accounting  Officer of AIMCO since April 2000.
From October 1993 until he joined  AIMCO,  Mr.  Novosel was a partner at Ernst &
Young LLP, where he served as the director of real estate advisory  services for
the  southern  Ohio  Valley  area  offices  but did not work on any  assignments
related to AIMCO or the Partnership.

One or more of the above persons are also directors and/or officers of a general
partner (or general partner of a general partner) of limited  partnerships which
either have a class of  securities  registered  pursuant to Section 12(g) of the
Securities Exchange Act of 1934, or are subject to the reporting requirements of
Section  15(d) of such Act.  Further,  one or more of the above persons are also
directors and/or officers of Apartment Investment and Management Company and the
general  partner  of  AIMCO  Properties,  L.P.,  entities  that  have a class of
securities  registered  pursuant to Section 12(g) of the Securities Exchange Act
of 1934, or are subject to the reporting  requirements of Section 15 (d) of such
Act.

The executive  officers and director of the Managing General Partner fulfill the
obligations  of the Audit  Committee  and  oversee the  Partnership's  financial
reporting process on behalf of the Managing General Partner.  Management has the
primary  responsibility  for the financial  statements and the reporting process
including  the  systems  of  internal  controls.  In  fulfilling  its  oversight
responsibilities,  the executive  officers and director of the Managing  General
Partner reviewed the audited  financial  statements with management  including a
discussion  of the  quality,  not  just  the  acceptability,  of the  accounting
principles,  the  reasonableness  of significant  judgments,  and the clarity of
disclosures in the financial statements.

The executive  officers and director of the Managing  General  Partner  reviewed
with the independent auditors,  who are responsible for expressing an opinion on
the conformity of those audited financial statements with accounting  principles
generally accepted in the United States,  their judgments as to the quality, not
just the  acceptability,  of the  Partnership's  accounting  principles and such
other  matters as are required to be discussed  with the Audit  Committee or its
equivalent under auditing standards  generally accepted in the United States. In
addition,  the  Partnership  has  discussed  with the  independent  auditors the
auditors' independence from management and the Partnership including the matters
in the written  disclosures  required by the  Independence  Standards  Board and
considered  the   compatibility   of  non-audit   services  with  the  auditors'
independence.

The executive  officers and director of the Managing  General Partner  discussed
with the  Partnership's  independent  auditors  the overall  scope and plans for
their audit. In reliance on the reviews and discussions  referred to above,  the
executive  officers and director of the Managing  General  Partner have approved
the  inclusion of the audited  financial  statements  in the Form 10-KSB for the
year  ended  December  31,  2002 for filing  with the  Securities  and  Exchange
Commission.

The Managing  General Partner has  reappointed  Ernst & Young LLP as independent
auditors to audit the financial statements of the Partnership for 2003. Fees for
2002 were  audit  services  of  approximately  $53,000  and  non-audit  services
(principally tax-related) of approximately $26,000.

Item 10.    Executive Compensation

Neither the director nor officers  received any  remuneration  from the Managing
General Partner during the year ended December 31, 2002.

Item 11.    Security Ownership of Certain Beneficial Owners and Management

The following table sets forth certain information regarding limited partnership
units of the  Registrant  owned by each person who is known by the Registrant to
own beneficially or exercise voting or dispositive  control over more than 5% of
the Registrant's  limited partnership units, by each of the directors and by all
directors and executive  officers of the Managing  General Partner as a group as
of December 31, 2002.

                                       Amount and Nature
        Name of Beneficial Owner      of Beneficial Owner     % of Class

        Insignia Properties, LP            25,399.00            41.97%
          (an affiliate of AIMCO)
        AIMCO Properties, LP               16,250.67            26.85%
          (an affiliate of AIMCO)

Insignia  Properties,  LP is indirectly  ultimately owned by AIMCO. Its business
address is 55 Beattie Place, Greenville, South Carolina 29602.

AIMCO Properties,  LP is indirectly ultimately controlled by AIMCO. Its business
address is 4582 S. Ulster St. Parkway, Suite 1100, Denver, Colorado 80237.

No director or officer of the Managing General Partner owns any units.

Item 12.    Certain Relationships and Related Transactions

The  Partnership  has no employees  and is  dependent  on the  Managing  General
Partner  and  its  affiliates  for  the  management  and  administration  of all
Partnership  activities.  The  Partnership  Agreement  provides  for payments to
affiliates for services and as  reimbursement  of certain  expenses  incurred by
affiliates on behalf of the Partnership.

During the years ended  December 31, 2002 and 2001,  affiliates  of the Managing
General  Partner were  entitled to receive 5% of gross  receipts from all of the
Partnership's  properties  as  compensation  for providing  property  management
services.  The Registrant  paid to such  affiliates  approximately  $373,000 and
$379,000 for the years ended December 31, 2002 and 2001, respectively,  which is
included in operating expenses.

An  affiliate  of  the  Managing  General  Partner  received   reimbursement  of
accountable  administrative  expenses  amounting to  approximately  $254,000 and
$539,000 for the years ended December 31, 2002 and 2001, respectively, which are
included in general  and  administrative  expenses  and  investment  properties.
Included in these amounts are fees related to construction  management  services
provided  by an  affiliate  of the  Managing  General  Partner of  approximately
$26,000  and  $269,000  for  the  years  ended   December  31,  2002  and  2001,
respectively. The construction management service fees are calculated based on a
percentage of current year additions to investment properties.

In connection with the refinancing of the mortgage loans encumbering  Northwoods
I and II  and  Fairway  View  Apartments,  the  Partnership  paid  approximately
$124,000 in loan costs to an affiliate  during the year ended December 31, 2001.
No such loan costs were paid in 2002.  These  loan costs were  capitalized,  are
included in other assets and are amortized as interest  expense over the term of
the loans.

For services relating to the  administration of the Partnership and operation of
Partnership  properties,  the  Managing  General  Partner is entitled to receive
payment for  non-accountable  expenses up to a maximum of $150,000 per year from
distributions from operations,  based upon the number of Partnership units sold,
subject  to  certain   limitations.   The  Managing   General  Partner  received
approximately  $91,000  in  such  reimbursements  for  both of the  years  ended
December  31,  2002 and 2001,  respectively,  which is  included  in general and
administrative expenses.

For managing the affairs of the Partnership, the Managing General Partner of the
Partnership  is entitled to receive a  partnership  management  fee.  The fee is
equal to 4% of the  Partnership's  adjusted cash from operations,  as defined in
the Partnership  Agreement,  in any year, provided that 50% of the fee shall not
be paid until the Partnership has distributed to the limited  partners  adjusted
cash from operations in such year which is equal to 5% of the limited  partners'
adjusted invested capital, as defined,  on a non-cumulative  basis. In addition,
50% of the fee shall not be paid until the  Partnership  has  distributed to the
limited partners adjusted cash from operations in such year which is equal to 8%
of the limited partners'  adjusted  invested capital on a non-cumulative  basis.
The fee shall be paid when adjusted cash from  operations is  distributed to the
limited partners.  The Managing General Partner earned approximately $33,000 for
such fees during the year ended December 31, 2002. The Managing  General Partner
was not entitled to receive this fee during the year ended December 31, 2001.

Upon the sale of the Partnership's properties, NPI Equity will be entitled to an
incentive  compensation  fee equal to a declining  percentage of the  difference
between the total amount distributed to limited partners and the appraised value
of their investment at February 1, 1992. The percentage amount to be realized by
NPI Equity,  if any,  will be  dependent  upon the year in which the property is
sold.  Payment of the incentive  compensation fee is subordinated to the receipt
by the limited partners, of: (a) distributions from capital transaction proceeds
of an amount equal to their appraised  investment in the Partnership at February
1, 1992; and (b) distributions from all sources (capital transactions as well as
cash  flow)  of an  amount  equal to six  percent  (6%)  per  annum  cumulative,
non-compounded,  on their present  appraised  investment in the  Partnership  at
February 1, 1992.

The Managing General Partner has extended to the Partnership a line of credit of
up to $500,000.  Loans under the line of credit will have a term of 365 days, be
unsecured  and bear  interest at the rate of 2% per annum in excess of the prime
rate announced from time to time by Chase Manhattan Bank, N.A. The maturity date
of such  borrowing  will be  accelerated in the event of: (i) the removal of the
Managing  General  Partner  (whether  or  not  For  Cause);  (ii)  the  sale  or
refinancing of a property by the  Partnership;  or (iii) the  liquidation of the
Partnership. At the present time, the Partnership has no outstanding amounts due
under this line of credit.

Beginning in 2001, the  Partnership  began insuring its properties up to certain
limits through coverage provided by AIMCO which is generally  self-insured for a
portion of losses and  liabilities  related  to workers  compensation,  property
casualty and vehicle liability. The Partnership insures its properties above the
AIMCO  limits  through  insurance  policies  obtained  by  AIMCO  from  insurers
unaffiliated with the Managing General Partner.  During the years ended December
31,  2002 and 2001,  the  Partnership  was  charged by AIMCO and its  affiliates
approximately $78,000 and $70,000, respectively, for insurance coverage and fees
associated with policy claims administration.

In addition to its  indirect  ownership of the general  partner  interest in the
Partnership,  AIMCO and its affiliates owned 41,649.67 limited partnership units
(the "Units") in the Partnership representing 68.82% of the outstanding units at
December  31,  2002.  A number of these Units were  acquired  pursuant to tender
offers  made by  AIMCO  or its  affiliates.  It is  possible  that  AIMCO or its
affiliates will acquire additional Units of limited partnership  interest in the
Partnership  in  exchange  for cash or a  combination  of cash and  units in the
operating  partnership  of AIMCO  either  through  private  purchases  or tender
offers. Under the Partnership  Agreement,  unitholders holding a majority of the
Units are  entitled to take action  with  respect to a variety of matters  which
would  include  voting on certain  amendments to the  Partnership  Agreement and
voting to remove the Managing General  Partner.  As a result of its ownership of
68.82% of the outstanding  Units, AIMCO is in a position to influence all voting
decisions with respect to the Registrant.  Although the Managing General Partner
owes fiduciary duties to the limited  partners of the Partnership,  the Managing
General Partner also owes fiduciary duties to AIMCO as its sole stockholder.  As
a result,  the duties of the  Managing  General  Partner,  as  managing  general
partner, to the Partnership and its limited partners may come into conflict with
the duties of the Managing  General Partner to AIMCO,  as its sole  stockholder.
However,  DeForest  Ventures II L.P.,  from whom AIMCO,  through its merger with
Insignia,  acquired  25,399  Units  (41.97%  of the  units),  had agreed for the
benefit of non-tendering unit holders, that it would vote its Units: (i) against
any  increase in  compensation  payable to the  Managing  General  Partner or to
affiliates;  and (ii) on all other matters submitted by it or its affiliates, in
proportion  to the  votes  cast  by all  other  unit  holders.  Except  for  the
foregoing,  no other  limitations are imposed on AIMCO's or its affiliates right
to vote each unit acquired.


<PAGE>



Item 13.    Exhibits and Reports on Form 8-K

      (a)   Exhibits:

            See Exhibit Index attached.

      (b) Reports on Form 8-K filed in the fourth quarter of calendar year 2002:

            None.

Item 14.    Controls and Procedures

The principal  executive officer and principal financial officer of the Managing
General Partner, who are the equivalent of the Partnership's principal executive
officer and principal financial officer,  respectively,  have, within 90 days of
the filing  date of this  annual  report,  evaluated  the  effectiveness  of the
Partnership's  disclosure  controls and  procedures  (as defined in Exchange Act
Rules 13a-14(c) and 15d-14(c)) and have determined that such disclosure controls
and  procedures  are  adequate.  There have been no  significant  changes in the
Partnership's  internal  controls or in other  factors that could  significantly
affect the  Partnership's  internal  controls since the date of evaluation.  The
Partnership does not believe any significant deficiencies or material weaknesses
exist in the Partnership's internal controls. Accordingly, no corrective actions
have been taken.


<PAGE>


                                   SIGNATURES



In accordance  with Section 13 or 15(d) of the Exchange Act, the  Registrant has
caused this Report to be signed on its behalf by the undersigned, thereunto duly
authorized.


                                    NATIONAL PROPERTY INVESTORS 7


                                    By:   NPI EQUITY INVESTMENTS, INC.
                                          Managing General Partner


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


                                    By:   /s/Thomas C. Novosel
                                          Thomas C. Novosel
                                          Senior Vice President
                                          and Chief Accounting Officer


                                    Date: March 28, 2003


In  accordance  with the Exchange  Act, this Report has been signed below by the
following  persons on behalf of the  Registrant and in the capacities and on the
date indicated.


/s/Patrick J. Foye      Executive Vice President      Date: March 28, 2003
Patrick J. Foye         and Director


/s/Thomas C. Novosel    Senior Vice President         Date: March 28, 2003
Thomas C. Novosel       and Chief Accounting Officer



<PAGE>




                                  CERTIFICATION


I, Patrick J. Foye, certify that:


1. I have  reviewed  this  annual  report on Form  10-KSB of  National  Property
Investors 7;


2.  Based on my  knowledge,  this  annual  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;


3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this annual report;


4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:


      a)  Designed  such  disclosure  controls  and  procedures  to ensure  that
      material   information   relating  to  the   registrant,   including   its
      consolidated  subsidiaries,  is made  known to us by others  within  those
      entities,  particularly  during the period in which this annual  report is
      being prepared;


      b) Evaluated the effectiveness of the registrant's disclosure controls and
      procedures  as of a date  within 90 days prior to the filing  date of this
      annual report (the "Evaluation Date"); and


      c) Presented in this annual report our conclusions about the effectiveness
      of the disclosure  controls and  procedures  based on our evaluation as of
      the Evaluation Date;


5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's   board  of  directors  (or  persons   performing   the  equivalent
functions):


      a) All  significant  deficiencies  in the design or  operation of internal
      controls which could adversely affect the registrant's  ability to record,
      process,  summarize and report  financial data and have identified for the
      registrant's auditors any material weaknesses in internal controls; and


      b) Any fraud,  whether or not material,  that involves management or other
      employees  who  have  a  significant  role  in the  registrant's  internal
      controls; and


6. The  registrant's  other  certifying  officers  and I have  indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.


Date:  March 28, 2003

                                /s/Patrick J. Foye
                                Patrick J. Foye
                                Executive   Vice   President   of   NPI   Equity
                                Investments,   Inc.,  equivalent  of  the  chief
                                executive officer of the Partnership


<PAGE>



                                  CERTIFICATION


I, Paul J. McAuliffe, certify that:


1. I have  reviewed  this  annual  report on Form  10-KSB of  National  Property
Investors 7;


2.  Based on my  knowledge,  this  annual  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;


3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this annual report;


4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:


      a)  Designed  such  disclosure  controls  and  procedures  to ensure  that
      material   information   relating  to  the   registrant,   including   its
      consolidated  subsidiaries,  is made  known to us by others  within  those
      entities,  particularly  during the period in which this annual  report is
      being prepared;


      b) Evaluated the effectiveness of the registrant's disclosure controls and
      procedures  as of a date  within 90 days prior to the filing  date of this
      annual report (the "Evaluation Date"); and


      c) Presented in this annual report our conclusions about the effectiveness
      of the disclosure  controls and  procedures  based on our evaluation as of
      the Evaluation Date;


5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's   board  of  directors  (or  persons   performing   the  equivalent
functions):


      a) All  significant  deficiencies  in the design or  operation of internal
      controls which could adversely affect the registrant's  ability to record,
      process,  summarize and report  financial data and have identified for the
      registrant's auditors any material weaknesses in internal controls; and


      b) Any fraud,  whether or not material,  that involves management or other
      employees  who  have  a  significant  role  in the  registrant's  internal
      controls; and


6. The  registrant's  other  certifying  officers  and I have  indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.


Date:  March 28, 2003

                                    /s/Paul J. McAuliffe
                                    Paul J. McAuliffe
                                    Executive Vice President and Chief Financial
                                    Officer of NPI Equity Investments, Inc.,
                                    equivalent of the chief financial officer of
                                    the Partnership


<PAGE>



                                  EXHIBIT INDEX



Exhibit Number    Description of Exhibit

2.5  Master Indemnity Agreement dated as of August 17, 1995. (1)

2.6  Agreement  and Plan of Merger,  dated as of October 1, 1998, by and between
     AIMCO and IPT. (2)

 3.4              (a)   Agreement of Limited Partnership. (3)

                  (b) Amendments to the Agreement of Limited Partnership. (4)

                  (c) Amendments to the Agreement of Limited Partnership. (5)

                  (d) Amendments to the Agreements of Limited Partnership. (6)

10.3 Property  Management  Agreement  dated June 21,  1991,  by and  between the
     Registrant and NPI Management  incorporated by reference to Exhibit 10.4 to
     the Registrant's Annual Report on Form 10-K for the year ended December 31,
     1991. (7)

10.4 Multifamily  Note  and  Addendum,  dated  January  4,  1994,  made  by  the
     Registrant for the benefit of Hanover Capital Mortgage  Corporation,  as it
     pertains to The Pines Apartments. (8)

10.5 Multifamily Deed of Trust,  Assignment of Rents and Security  Agreement and
     Rider,  dated January 4, 1994,  between the Registrant and Hanover  Capital
     Mortgage Corporation, as it pertains to The Pines Apartments. (8)

10.6 Multifamily  Note secured by a Mortgage or Deed of Trust dated  November 1,
     1996,  between National Property  Investors 7 and Lehman Brothers Holdings,
     Inc.,  d/b/a Lehman Capital,  a Division of Lehman Brothers  Holdings Inc.,
     relating to Northwoods Apartments. (9)

10.7 Multifamily  Note secured by a Mortgage or Deed of Trust dated  November 1,
     1996,  between National Property  Investors 7 and Lehman Brothers Holdings,
     Inc.,  d/b/a Lehman Capital,  a Division of Lehman Brothers  Holdings Inc.,
     relating to South Point Apartments. (9)

10.8 Multifamily  Note secured by a Mortgage or Deed of Trust dated  November 1,
     1996,  between National Property  Investors 7 and Lehman Brothers Holdings,
     Inc.,  d/b/a Lehman Capital,  a Division of Lehman Brothers  Holdings Inc.,
     relating to Patchen Place Apartments. (9)

10.9 Multifamily  Note secured by a Mortgage or Deed of Trust dated  November 1,
     1996,  between National Property  Investors 7 and Lehman Brothers Holdings,
     Inc.,  d/b/a Lehman Capital,  a Division of Lehman Brothers  Holdings Inc.,
     relating to Fairway View II Apartments. (9)

10.10Multifamily Note dated December 9, 1999, by and between  National  Property
     Investors 7, a California limited  partnership and GMAC Commercial Mortgage
     Corporation, a California corporation. (10)

10.11Multifamily  Note dated August 31, 2001, by and between  National  Property
     Investors 7, a California Limited Partnership, and GMAC Commercial Mortgage
     Corporation,  a  California  Corporation  relating to  Northwoods  I and II
     Apartments. (incorporated by reference to the Registrant's Quarterly Report
     on Form 10-QSB for the quarter ended September 30, 2001).

10.12Multifamily Note dated November 30, 2001, by and between National  Property
     Investors 7, a California Limited  Partnership and GMAC Commercial Mortgage
     Corporation,   a  California   corporation  relating  to  Fairway  View  II
     Apartments  (incorporated  by  reference  to Exhibit  10.12  filed with the
     Registrant's  Annual Report on Form 10-KSB for the year ended  December 31,
     2001).

99   Certification of Chief Executive Officer and Chief Financial Officer.

(1)  Incorporated by reference to Exhibit 2.5 to Form 8-K filed by Insignia with
     the Securities and Exchange Commission on September 1, 1995.

(2)  Incorporated  by  reference  to  Exhibit  2.1 filed  with the  Registrant's
     Current Report on Form 8-K dated October 1, 1998.

(3)  Incorporated  by reference to Exhibit A to the Prospectus of the Registrant
     dated July 5, 1978, contained in the Registrant's Registration Statement on
     Form S-11 (Reg. No. 2-599991).

(4)  Incorporated  by  reference  to  the  Definitive  Proxy  Statement  of  the
     Partnership dated July 2, 1981.

(5)  Incorporated by reference to Definitive  Proxy statement of the Partnership
     dated April 3, 1991.

(6)  Incorporated  by reference,  to the Statement  Furnished in Connection With
     the Solicitation of Consents of the Registrant dated August 28, 1992.

(7)               Incorporated by reference to the Registrant's Annual Report on
                  Form 10-K for the year  ended  December  31,  1991.  Identical
                  agreements have been entered into for each of the Registrant's
                  properties.  The only difference in the agreements is that the
                  applicable property name has been inserted into the agreement.

(8)               Incorporated by reference to the Registrant's Annual Report on
                  Form 10-K for the period ended December 31, 1993.

(9)               Incorporated by reference to the Registrant's Annual Report on
                  Form 10-K for the period ended December 31, 1996.

(10)              Incorporated by reference to the Registrant's Annual Report on
                  Form 10-KSB for the period ended December 31, 1999.




<PAGE>


Exhibit 99


                          Certification of CEO and CFO
                       Pursuant to 18 U.S.C. Section 1350,
                             As Adopted Pursuant to
                   Section 906 of the Sarbanes-Oxley Act of 2002



In  connection  with the  Annual  Report  on Form  10-KSB of  National  Property
Investors 7 (the  "Partnership"),  for the year ended December 31, 2002 as filed
with the Securities and Exchange  Commission on the date hereof (the  "Report"),
Patrick  J.  Foye,  as the  equivalent  of the Chief  Executive  Officer  of the
Partnership,  and Paul J.  McAuliffe,  as the equivalent of the Chief  Financial
Officer of the Partnership, each hereby certifies, pursuant to 18 U.S.C. Section
1350,  as adopted  pursuant  to Section 906 of the  Sarbanes-Oxley  Act of 2002,
that, to the best of his knowledge:

      (1)   The Report fully complies with the  requirements of Section 13(a) or
            15(d) of the Securities Exchange Act of 1934; and

      (2)   The  information  contained in the Report  fairly  presents,  in all
            material respects, the financial condition and results of operations
            of the Partnership.


                                           /s/Patrick J. Foye
                                    Name:  Patrick J. Foye
                                    Date:  March 28, 2003


                                           /s/Paul J. McAuliffe
                                    Name:  Paul J. McAuliffe
                                    Date:  March 28, 2003


This  certification  accompanies  the  Report  pursuant  to  Section  906 of the
Sarbanes-Oxley  Act of 2002 and shall not,  except to the extent required by the
Sarbanes-Oxley  Act of 2002, be deemed filed by the  Partnership for purposes of
Section 18 of the Securities Exchange Act of 1934, as amended.