UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   Form 10-KSB

[X]   ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
      OF 1934
                 For the fiscal year ended December 31, 2004

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

               For the transition period _________to _________

                         Commission file number 0-13810

                       REAL ESTATE ASSOCIATES LIMITED VII
                 (Name of small business issuer in its charter)

         California                                                 95-3290316
(State or other jurisdiction of                                 (I.R.S. Employer
 incorporation or organization)                              Identification No.)

                          55 Beattie Place, PO 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:

                          Limited Partnership Interests
                                (Title of class)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding  twelve 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 ninety days.
Yes   X    No ____

Indicate by check mark if  disclosure of  delinquent  filers  pursuant to Item
405 of Regulation S-K is not contained herein,  and will not 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 revenue for its most recent fiscal year $15,000.

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,  2004.  No market for the  Registrant's  limited
partnership  interests exists, 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.  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;  litigation,  including  costs  associated  with  prosecuting  and
defending  claims  and  any  adverse   outcomes,   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

Real  Estate  Associates  Limited  VII ("REAL  VII" or the  "Partnership")  is a
limited  partnership  which was formed under the laws of the State of California
on May 24,  1983.  On  February 1, 1984,  the  Partnership  offered  2,600 units
consisting  of 5,200  limited  partnership  interests and warrants to purchase a
maximum of 10,400  additional  limited  partnership  interests  through a public
offering  managed by E.F.  Hutton Inc. The Partnership  received  $39,000,000 in
subscriptions  for units of limited  partnership  interests (at $5,000 per unit)
during  the  period  from  March  7,  1984  to  June  11,  1985,  pursuant  to a
registration statement on Form S-11.

The  Partnership  shall be  dissolved  only upon the  expiration  of 50 complete
calendar  years  (December  31,  2033)  from  the date of the  formation  of the
Partnership  or the  occurrence  of various  other  events as  specified  in the
Partnership  agreement.  The principal business of the Partnership is to invest,
directly or  indirectly,  in other limited  partnerships  which own or lease and
operate Federal, state and local government-assisted housing projects.

The general  partners of the  Partnership are National  Partnership  Investments
Corp.  ("NAPICO"),  a California  Corporation (the "Corporate General Partner"),
and National Partnership  Investments  Associates II ("NAPIA II"). NAPIA II is a
limited  partnership  formed under the California  Limited  Partnership  Act and
consists of Mr.  Charles H.  Boxenbaum as the general  partner and two unrelated
individuals as limited  partners.  The business of the  Partnership is conducted
primarily by NAPICO.

On December 3, 2001, Casden Properties Inc., entered into a merger agreement and
certain other  transaction  documents with  Apartment  Investment and Management
Company ("AIMCO"), a publicly traded real estate investment trust and certain of
its  subsidiaries,  pursuant to which, on March 11, 2002,  AIMCO acquired Casden
Properties Inc. and its subsidiaries,  including 100% of the outstanding capital
stock of NAPICO.  Prior to March 11, 2002, Casden Properties Inc. owned a 95.25%
economic  interest  in  NAPICO,  with the  balance  owned by  Casden  Investment
Corporation ("CIC").  CIC, which is wholly owned by Alan I. Casden, owned 95% of
the voting common stock of NAPICO prior to March 11, 2002.

The  Partnership  holds  limited  partnership  interests  in  12  local  limited
partnerships  (the "Local  Limited  Partnerships")  as of December 31, 2004. The
Partnership also holds a general partner  interest in Real Estate  Associates IV
("REA IV") which, in turn, holds limited partnership  interests in 11 additional
Local Limited Partnerships as of December 31, 2004,  therefore,  the Partnership
holds  interests,  either  directly  or  indirectly  through REA IV, in 23 Local
Limited  Partnerships  as of December 31, 2004. The other general partner of REA
IV is NAPICO. During 2004 the Partnership lost its interest in one Local Limited
Partnership  due to the sale of the property to a third  party.  During 2003 the
Partnership  sold its interest in two Local  Limited  Partnerships.  Each of the
Local Limited Partnerships owns a low income housing project which is subsidized
and/or has a mortgage  note  payable to or is insured by agencies of the federal
or local government.

The  partnerships in which Real VII has invested are principally  existing Local
Limited Partnerships.  The Partnership became the limited partner in these Local
Limited  Partnerships  pursuant  to  arm's-length  negotiations  with the  Local
Limited  Partnership's  general  partners  who are  often the  original  project
developers.  In certain other cases,  the  Partnership  invested in newly formed
Local Limited  Partnerships which, in turn, acquired the projects.  As a limited
partner,  the  Partnership's  liability  for  obligations  of the Local  Limited
Partnership is limited to its investment. The local general partner of the Local
Limited  Partnership  retains the  responsibility of maintaining,  operating and
managing the property  owned by the Local  Limited  Partnership.  Under  certain
circumstances  of default,  the  Partnership  has the right to replace the local
general partner of the Local Limited  Partnerships,  but otherwise does not have
control of sale, refinancing, etc.

Although each of the  partnerships in which Real VII has invested will generally
own a project  which  must  compete in the market  place for  tenants,  interest
subsidies and rent  supplements from  governmental  agencies make it possible to
offer  these  dwelling  units  to  eligible  "low  income"  tenants  at  a  cost
significantly  below the  market  rate for  comparable  conventionally  financed
dwelling units in the area.

The  Partnership  does not have any  employees.  Services are  performed for the
Partnership  by  the  Corporate  General  Partner  and  agents  retained  by the
Corporate General Partner.

In order to stimulate  private  investment  in low income  housing,  the federal
government  and  certain  state and local  agencies  have  provided  significant
ownership  incentives,   including  among  others,   interest  subsidies,   rent
supplements,  and mortgage insurance, with the intent of reducing certain market
risks and  providing  investors  with  certain tax  benefits,  plus limited cash
distributions  and the  possibility of long-term  capital  gains.  There remain,
however,  significant  risks.  The long-term nature of investments in government
assisted  housing limits the ability of the Partnership to vary its portfolio in
response  to changing  economic,  financial,  and  investment  conditions.  Such
investments  are also  subject to changes in local  economic  circumstances  and
housing patterns, as well as rising operating costs, vacancies,  rent collection
difficulties,  energy shortages,  and other factors which have an impact on real
estate values.  These projects also require greater management expertise and may
have higher operating expenses than conventional housing projects.

Under recently adopted law and policy,  the United States  Department of Housing
and Urban Development ("HUD") has determined not to renew the Housing Assistance
Payment  ("HAP")  Contracts  on a long  term  basis on the  existing  terms.  In
connection with renewals of the HAP Contracts under such new law and policy, the
amount of rental  assistance  payments under renewed HAP Contracts will be based
on market rentals instead of above market  rentals,  which may be the case under
existing HAP Contracts.  The payments under the renewed HAP Contracts may not be
in an amount  that  would  provide  sufficient  cash  flow to  permit  owners of
properties  subject to HAP  Contracts to meet the debt service  requirements  of
existing  loans  insured by the Federal  Housing  Administration  of HUD ("FHA")
unless such mortgage loans are  restructured.  In order to address the reduction
in payments under HAP Contracts as a result of this new policy, the Multi-family
Assisted Housing Reform and  Affordability  Act of 1997 ("MAHRAA")  provides for
the  restructuring  of  mortgage  loans  insured  by the  FHA  with  respect  to
properties  subject  to the  Section 8 program.  Under  MAHRAA,  an  FHA-insured
mortgage  loan can be  restructured  into a first  mortgage  loan  which will be
amortized on a current basis and a low interest  second mortgage loan payable to
FHA which will only be payable on  maturity  of the first  mortgage  loan.  This
restructuring results in a reduction in annual debt service payable by the owner
of the  FHA-insured  mortgage  loan and is  expected  to result in an  insurance
payment from FHA to the holder of the  FHA-insured  loan due to the reduction in
the principal amount. MAHRAA also phases out project-based subsidies on selected
properties  serving  families not located in rental markets with limited supply,
converting such subsidies to a tenant-based subsidy.

When the HAP  Contracts are subject to renewal,  there can be no assurance  that
the Local Limited  Partnerships  in which the Partnership has an investment will
be permitted to restructure its mortgage indebtedness under MAHRAA. In addition,
the  economic  impact  on the  Partnership  of the  combination  of the  reduced
payments  under  the  HAP  Contracts  and  the  restructuring  of  the  existing
FHA-insured mortgage loans under MAHRAA is uncertain.

Laws benefiting  disabled persons may result in the Local Limited  Partnerships'
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  Local  Limited  Partnerships'  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  Corporate  General  Partner
believes that the Local Limited  Partnerships'  properties are  substantially in
compliance with present  requirements,  the Local Limited Partnerships may incur
unanticipated expenses to comply with the ADA and the FHAA.

During 2004,  all of the  projects in which the  Partnership  had invested  were
substantially  rented. The following is a schedule of the status, as of December
31,  2004,  of the projects  owned by Local  Limited  Partnerships  in which the
Partnership, either directly or indirectly through REA IV, has invested.

            SCHEDULE OF PROJECTS OWNED BY LOCAL LIMITED PARTNERSHIPS
                       IN WHICH REAL VII HAS AN INVESTMENT
                                DECEMBER 31, 2004
<TABLE>
<CAPTION>

                                                          Units
                                                        Authorized
                                                        for Rental
                                                        Assistance
                                           Financed,      Under           Occupancy
                                            Insured    or Other Rent      Percentage
                                              and       Supplement    for the Years Ended
                               Number of  Subsidized     Program          December 31,
Property Name and Location       Units       Under      Section 8 (B)   2004       2003

Aristocrat Manor
<S>                                <C>                     <C>         <C>         <C>
Hot Springs, AR                    101        (A)          101         86%         92%

Arkansas City Apts.
Arkansas City, AR                   16        (C)           12         73%         81%

Bellair Manor Apts.
Niles, OH                           68        (A)            7         94%         96%

Birch Manor Apts. I
Medina, OH                          60        (A)           12         88%         98%

Birch Manor Apts. II
Medina, OH                          60        (A)            6         95%         98%

Bluewater Apts.
Port Huron, MI                     116        (E)           --         87%         87%

Clarkwood Apts. I
Elyria, OH                          72        (A)           34         97%         97%

Clarkwood Apts. II
Elyria, OH                         120        (A)           51         97%         98%

Hampshire House
Warren, OH                         150        (A)          150         98%         99%

Ivywood Apts.
Columbus, OH                       124        (A)          124         98%         97%

Jasper County Prop.
Heidelberg, MS                      24        (C)           24         96%         92%

Nantucket Apts.
Alliance, OH                        60        (A)           59         95%         97%

Newton Apts.
Newton, MS                          36        (C)           --         67%         71%

Oak Hill Apts.
Franklin, PA                       120        (A)           82         99%         99%

Oakview Apts.
Monticello, AR                      32        (C)            7         81%         82%

Oakwood Park I Apts.
Lorain, OH                          50        (D)            50        97%         94%

Oakwood Park II Apts.
Lorain, OH                          78        (D)            --        94%         95%

Pachuta Apts.
Pachuta, MS                         16        (C)            16        95%         97%

Richards Park Apts.
Elyria, OH                          60        (A)            24        96%         98%

Shubuta Properties
Shubuta, MS                         16        (C)            16        97%         97%

Tradewinds East
Essexville, MI                     150        (E)            30        90%         94%

Warren Heights Apts. I
Warren, OH                          88        (A)            88        95%         94%

Yorkview Estates
Massillon, OH                       50        (A)            50        97%         99%

TOTALS                            1,667                     943
</TABLE>

(A)   The  mortgage is insured by the  Federal  Housing  Administration  ("FHA")
      under the provisions of Section 236 of the National Housing Act.

(B)   Section 8 of Title II of the  Housing  and  Community  Development  Act of
      1974.

(C)   The mortgage is insured by USDA, Rural Development.

(D)   The mortgage is insured by FHA, under the provisions of section  221(d)(3)
      of the National Housing Act.

(E)   The  mortgage  is  insured  by  the  Michigan  State  Housing  Development
      Authority.



<PAGE>


Ownership Percentages

The following table details the Partnership's ownership percentages of the Local
Limited  Partnerships  and  the  cost of  acquisition  of  such  ownership.  All
interests are limited  partner  interests  owned directly by the  Partnership or
indirectly  through REA IV. Also included is the total  mortgage  encumbrance on
each  property  for each of the Local  Limited  Partnerships  as of December 31,
2004.
<TABLE>
<CAPTION>

                           Real VII
                           or REA IV    Original Cost                  Notes Payable
                          Percentage     of Ownership     Mortgage      and Accrued
      Partnership          Interest        Interest         Notes        Interest
                                                       (in thousands)
<S>                            <C>          <C>            <C>             <C>
Aristocrat Manor               99%          $ 710          $ 3,057         $ --
Arkansas City Apts.            99%              95            487              --
Bellair Manor Apts.         98.99%             305             661             --
Birch Manor Apts. I         99.55%             250             265          1,098
Birch Manor Apts. II        99.56%             258             541            989
Bluewater Apts.                99%             650           1,287             --
Clarkwood Apts. I           98.99%             289             298          1,456
Clarkwood Apts. II          99.57%             495             646          2,253
Hampshire House             98.99%             690           2,407             --
Ivywood Apts.               98.99%             550           1,230             --
Jasper County Prop.          99%               128             647             --
Nantucket Apts.            98.99%              225            421              --
Newton Apts.                  99%              185            981              --
Oak Hill Apts.              98.99%             565          1,486              --
Oakview Apts.                  99%             214          1,085              --
Oakwood Park I Apts.        98.79%             160             102          1,108
Oakwood Park II Apts.       99.99%             260             206          1,648
Pachuta Apts.                  99%              85             438             --
Richards Park Apts.          98.99%            275             529             --
Shubuta Properties             99%              86             435             --
Tradewinds East                99%             850           1,728             --
Warren Heights Apts. I      98.99%             375             881             --
Yorkview Estates            98.99%             220            493              --
                                           $ 7,920         $20,311        $ 8,552
</TABLE>

Although each Local Limited  Partnership in which the  Partnership  has invested
owns an apartment complex which must compete with other apartment  complexes for
tenants,  government  mortgage  interest and rent  subsidies make it possible to
rent units to eligible tenants at below market rates. In general, this insulates
the projects from market competition.

Item 2.     Description of Properties

See  "Item  1.  Description  of  Business"  for the  real  estate  owned  by the
Partnership  through the  ownership  of limited  partnership  interests in Local
Limited Partnerships.

Item 3.     Legal Proceedings

The  Corporate  General  Partner is involved in various  lawsuits  arising  from
transactions  in the ordinary  course of business.  In the opinion of management
and the Corporate  General  Partner,  the claims will not result in any material
liability to the Partnership.

Item 4.     Submission Of Matters To A Vote Of Security Holders

During the quarter ended December 31, 2004, no matter was submitted to a vote of
unit holders through the solicitation of proxies or otherwise.


<PAGE>


                                     PART II

Item 5.     Market For The  Registrant's  Partnership  Interests  And  Related
            Partnership Matters

The Limited  Partnership  Interests are not traded on a public exchange but were
sold through a public offering managed by E.F. Hutton Inc. It is not anticipated
that any public market will develop for the purchase and sale of any partnership
interest;  therefore,  an investor may be unable to sell or otherwise dispose of
his or her interest in the  partnership.  Limited  Partnership  Interests may be
transferred only if certain  requirements  are satisfied.  At December 31, 2004,
there were 2,947  registered  holders,  owning an  aggregate  of 15,449  limited
partnership units (the "Units") in the Partnership. The Partnership has invested
in certain  government  assisted projects under programs which in many instances
restrict the cash return  available to project  owners.  The Partnership was not
designed to provide cash distributions to investors in circumstances  other than
refinancing or disposition of its investments in limited partnerships.  In March
1999, the Partnership  made a distribution  of $272,250 to the limited  partners
and  $2,750  to the  general  partners,  using  proceeds  from  the  sale of the
partnership interests.  No other distributions have been made from the inception
of the Partnership.

AIMCO and its  affiliates  owned  583.79 Units or 1,167.58  limited  partnership
interests in the  Partnership  representing  7.56% of the  outstanding  Units at
December 31, 2004. A unit consists of two limited partnership  interests.  It is
possible that AIMCO or its affiliates will acquire  additional Units in exchange
for cash or a  combination  of cash and  units in AIMCO  Properties,  L.P.,  the
operating  partnership  of AIMCO,  either  through  private  purchases or tender
offers. Pursuant to the Partnership Agreement, unitholders holding a majority of
the Units are entitled to take action with respect to a variety of matters, that
include, but are not limited to, voting on certain amendments to the Partnership
Agreement  and voting to remove the  Corporate  General  Partner.  Although  the
Corporate  General Partner owes fiduciary  duties to the limited partners of the
Partnership,  the Corporate  General partner also owes fiduciary duties to AIMCO
as its sole  stockholder.  As a  result,  the  duties of the  Corporate  General
Partner,  as  corporate  general  partner,  to the  Partnership  and its limited
partners may come into conflict with the duties of the Corporate General Partner
to AIMCO as its sole stockholder.

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

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

The Corporate  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.

Liquidity and Capital Resources

The  Partnership's  primary sources of funds include interest income earned from
investing  available cash and distributions  from Local Limited  Partnerships in
which the  Partnership  has  invested.  It is not expected that any of the Local
Limited  Partnerships  in which the  Partnership has invested will generate cash
flow sufficient to provide for distributions to limited partners in any material
amount.

The accompanying  consolidated  financial statements have been prepared assuming
the Partnership will continue as a going concern.  The Partnership  continues to
generate recurring operating losses. In addition,  the Partnership is in default
on notes  payable and related  accrued  interest  payable that  matured  between
December 1999 and December 2004.


<PAGE>



Eleven of the  Partnership's  twenty-three  investments  involved  purchases  of
partnership interests from partners who subsequently withdrew from the operating
partnership.  The  Partnership  is obligated for  non-recourse  notes payable of
approximately  $6,840,000 to the sellers of the partnership  interests,  bearing
interest at 9.5 to 10 percent.  Total  outstanding  accrued interest at December
31,  2004 is  approximately  $12,742,000.  These  obligations  and  the  related
interest are collaterized by the  Partnership's  investment in the Local Limited
Partnerships  and are  payable  only out of cash  distributions  from the  Local
Limited  Partnerships,  as  defined  in the notes.  Unpaid  interest  was due at
maturity of the notes.  The  Partnership has not repaid the notes payable and is
in default under the terms of the notes.

Management is attempting  to negotiate  extensions of the maturity  dates on the
notes. If the  negotiations  are  unsuccessful,  the Partnership  could lose its
investment in the Local Limited  Partnerships to foreclosure.  In addition,  the
Partnership  may  seek  operating  advances  from  the  general  partner  of the
Partnership.  However,  the Corporate  General  Partner is not obligated to fund
such advances.

As a result of the above,  there is  substantial  doubt about the  Partnership's
ability to continue as a going concern. The consolidated financial statements do
not  include  any  adjustments  to reflect the  possible  future  effects of the
recoverability  and  classification of assets or amounts and  classifications of
liabilities that may result from these uncertainties.

The Corporate  General  Partner  negotiated an extension of the maturity date of
the non-recourse note payable related to Tradewinds East Limited  Partnership to
December 31, 2004.  The  Partnership  received  distributions  of  approximately
$39,000 from Tradewinds East Limited  Partnership during the year ended December
31, 2004,  approximately  $34,000 of which was used to make a payment of accrued
interest on the related  note  payable.  This note  payable is in default due to
non-payment at December 31, 2004.

During  the year  ended  December  31,  2003,  the  Partnership  entered  into a
settlement  agreement with the general partner of Rand Grove Village Partnership
wherein the general partner of the Local Limited  Partnership would purchase the
property in full satisfaction of the non-recourse note payable.  The Partnership
received  approximately  $100,000  during the year ended  December 31, 2003 as a
deposit pursuant to this settlement agreement.  During 2004, the general partner
of the Local Limited  Partnership  filed a motion to vacate such agreement.  The
general  partner's motion to vacate the settlement order was denied on April 20,
2004.  The  Partnership  recognized  the deposit as income during the year ended
December 31, 2004.  During the year ended  December  31, 2004,  the  Partnership
received  approximately  $3,023,000  in net cash  proceeds  from the sale of the
property  owned by Rand Grove Village  Partnership to a third party on August 3,
2004. This amount was net of  approximately  $1,340,000 in principal  repayments
and $2,275,000 in interest  repayments on non-recourse  notes payable (See "Item
7. Financial Statements - Note 4"). After applying  approximately $7,000 for the
repayment of an advance,  the total gross proceeds of  approximately  $6,631,000
was  recognized  during the year ended  December 31, 2004 as a  distribution  in
excess of  investment  in the  limited  partnership  as the  Partnership  had no
remaining  investment related to this Local Limited  Partnership at December 31,
2004.

Results of Operations

At December  31, 2004,  the  Partnership  had  investments  in 12 Local  Limited
Partnerships  and a general  partner  interest in REA IV which,  in turn,  holds
limited partner  interests in 11 additional Local Limited  Partnerships,  all of
which own housing projects,  most of which were  substantially  all rented.  The
Partnership, as a limited partner, does not exercise control over the activities
and operations,  including refinancing or selling decisions of the Local Limited
Partnerships.  Accordingly,  the Partnership  accounts for its investment in the
Local  Limited  Partnerships  using  the  equity  method.  Thus  the  individual
investments  are  carried  at cost  plus the  Partnership's  share of the  Local
Limited  Partnership's profits less the Partnership's share of the Local Limited
Partnership's losses, distributions,  and impairment charges. However, since the
Partnership  is not  legally  liable for the  obligations  of the Local  Limited
Partnerships,  or is not otherwise  committed to provide  additional  support to
them,  it does not  recognize  losses once its  investment  in each of the Local
Limited  Partnerships  reaches  zero.   Distributions  from  the  Local  Limited
Partnerships  are accounted for as a reduction of the  investment  balance until
the investment balance is reduced to zero. Subsequent distributions received are
recognized as income in the accompanying  consolidated statements of operations.
For those  investments  where the  Partnership  has determined that the carrying
value  of its  investments  approximates  the  estimated  fair  value  of  those
investments,  the  Partnership's  policy is to recognize equity in income of the
Local Limited  Partnerships  only to the extent of distributions  received,  and
amortization of acquisition costs from those Local Limited Partnerships.

There was no recognition of equity in losses from the Local Limited Partnerships
for the years ended December 31, 2004 and 2003, as the Partnership's  investment
in all Local Limited  Partnership's had been reduced to zero prior to January 1,
2003.

During the year ended December 31, 2004, the Partnership received  approximately
$3,023,000  in net cash  proceeds  from the sale of the  property  owned by Rand
Grove Village  Partnership  to a third party on August 3, 2004.  This amount was
net of  approximately  $1,340,000  in principal  repayments  and  $2,275,000  in
interest  repayments  on  non-recourse  notes  payable  (See "Item 7.  Financial
Statements - Note 4"). After applying  approximately $7,000 for the repayment of
an advance, the total gross proceeds of approximately $6,630,000 were recognized
during  the  year  ended  December  31,  2004 as a  distribution  in  excess  of
investment in limited partnership as the Partnership had no remaining investment
related to this Local Limited Partnership at December 31, 2004.

In  December  2003,  the  Partnership  sold  its  interest  in  Henrico  limited
partnership  and  realized a gain on sale of limited  partnership  interests  of
approximately $2,322,000.  The gain is equal to the net proceeds received by the
Partnership as the Partnership had no remaining investment related to this Local
Limited  Partnership.  The Partnership used approximately  $2,260,000 of the net
proceeds to repay a portion of the  interest on the past due  non-recourse  note
payable in full  satisfaction  of the note. The remaining  principal  balance of
approximately  $1,675,000 and related accrued interest of approximately $620,000
was forgiven.  Accordingly,  the Partnership  recognized a gain of approximately
$2,295,000  on the  extinguishment  of debt during the year ended  December  31,
2003.

In  March  2003,  the  Partnership  sold its  interest  in  South  Glen  limited
partnership  and  realized a gain on sale of limited  partnership  interests  of
approximately  $232,000 for the year ended  December 31, 2003. The gain is equal
to the net  proceeds  received  by the  Partnership  as the  Partnership  had no
remaining investment related to this Local Limited Partnership.  In addition, as
part of the sale, the Partnership's obligation on the past due non-recourse note
payable  of   approximately   $970,000  and  the  related  accrued  interest  of
approximately  $1,547,000 was  transferred to the  purchaser.  Accordingly,  the
Partnership recognized a gain of approximately  $2,517,000 on the extinguishment
of debt during the year ended December 31, 2003.

During August 2002, the Partnership  purchased from the holder the matured notes
owed  by  DPM  Associates  which  is a  limited  partner  of the  Local  Limited
Partnership,  which owns Danbury Park Manor, with a face value of $1,150,000 and
related  accrued  interest  of  approximately   $1,800,000,   for  approximately
$765,000.  In October 2002,  the Local Limited  Partnership  sold its investment
property.  The Partnership received proceeds of approximately  $1,502,000 during
2002 in payment of its  advances  and  repayment  of the notes it  purchased  in
August 2002.  During the year ended  December 31, 2003,  additional  proceeds of
approximately  $50,000  were  received  by the  Partnership  and  recorded as an
additional gain on the sale for the year ended December 31, 2003.

A recurring partnership expense is the annual management fee. The fee is payable
to the Corporate  General  Partner of the  Partnership  and is calculated at 0.5
percent of the Partnership's  original remaining invested assets. The management
fee is paid to the Corporate  General  Partner for its continuing  management of
Partnership  affairs.  The fee is payable beginning with the month following the
Partnership's initial investment in a Local Limited Partnership. Management fees
were  approximately  $266,000 and $325,000 for the year ended  December 31, 2004
and 2003,  respectively.  The decrease in management  fees charged is due to the
decrease in the number of Local Limited  Partnerships  in which the  Partnership
held investments,  as a result of sales of limited partnership interests and the
sales of properties owned by certain Local Limited Partnerships during the years
ended December 31, 2004 and 2003.

Operating expenses,  other than interest expense and management fees, consist of
legal and accounting  fees for services  rendered to the Partnership and general
and  administrative  expenses.  Legal and  accounting  fees  were  approximately
$244,000  and  $195,000  for  the  years  ended  December  31,  2004  and  2003,
respectively.  The  increase  in legal and  accounting  fees for the year  ended
December 31, 2004 is primarily due to an increase in legal fees  associated with
the sale of Rand Grove, as discussed above. General and administrative  expenses
were  approximately  $177,000 and $98,000 for the years ended  December 31, 2004
and 2003, respectively.  The increase in general and administrative expenses for
the year ended  December  31, 2004 is  primarily  due to the  recognition  of an
Illinois  income tax liability  related to the sale of Rand Grove,  as discussed
above. Also included in general and  administrative  expenses are reimbursements
to NAPICO for certain expenses,  which totaled approximately $43,000 for each of
the years ended December 31, 2004 and 2003.

The Partnership, as a limited partner in the Local Limited Partnerships in which
it has  invested,  is  subject  to the  risks  incident  to the  management  and
ownership of improved real estate. The Partnership  investments are also subject
to adverse  general  economic  conditions  and,  accordingly,  the status of the
national economy,  including substantial unemployment,  concurrent inflation and
changing legislation, could increase vacancy levels, rental payment defaults and
operating  expenses,  which in turn,  could  substantially  increase the risk of
operating losses for the projects.

Under recently adopted law and policy,  the United States  Department of Housing
and Urban Development ("HUD") has determined not to renew the Housing Assistance
Payment  ("HAP")  Contracts  on a long  term  basis on the  existing  terms.  In
connection with renewals of the HAP Contracts under such new law and policy, the
amount of rental  assistance  payments under renewed HAP Contracts will be based
on market rentals instead of above market  rentals,  which may be the case under
existing HAP Contracts.  The payments under the renewed HAP Contracts may not be
in an amount  that  would  provide  sufficient  cash  flow to  permit  owners of
properties  subject to HAP  Contracts to meet the debt service  requirements  of
existing  loans  insured by the Federal  Housing  Administration  of HUD ("FHA")
unless such mortgage loans are  restructured.  In order to address the reduction
in payments under HAP Contracts as a result of this new policy, the Multi-family
Assisted Housing Reform and Affordability  Act of 1997 ("MAHRAA"),  provides for
the  restructuring  of  mortgage  loans  insured  by the  FHA  with  respect  to
properties  subject  to the  Section 8 program.  Under  MAHRAA,  an  FHA-insured
mortgage  loan can be  restructured  into a first  mortgage  loan  which will be
amortized on a current basis and a low interest  second mortgage loan payable to
FHA which will only be payable on  maturity  of the first  mortgage  loan.  This
restructuring results in a reduction in annual debt service payable to the owner
of the  FHA-insured  mortgage  loan and is  expected  to result in an  insurance
payment from FHA to the holder of the  FHA-insured  loan due to the reduction in
the principal amount. MAHRAA also phases out project-based subsidies on selected
properties  serving  families not located in rental markets with limited supply,
converting such subsidies to a tenant-based subsidy.

When the HAP  Contracts are subject to renewal,  there can be no assurance  that
the Local Limited  Partnerships  in which the Partnership has an investment will
be permitted  to  restructure  their  mortgage  indebtedness  under  MAHRAA.  In
addition,  the economic  impact on the  Partnerships  of the  combination of the
reduced  payments under the HAP Contracts and the  restructuring of the existing
FHA-insured mortgage loans under MAHRAA is uncertain.

Other

AIMCO and its  affiliates  owned  583.79 Units or 1,167.58  limited  partnership
interests in the  Partnership  representing  7.56% of the  outstanding  Units at
December 31, 2004. A unit consists of two limited partnership  interests.  It is
possible that AIMCO or its affiliates will acquire  additional Units in exchange
for cash or a  combination  of cash and  units in AIMCO  Properties,  L.P.,  the
operating  partnership  of AIMCO,  either  through  private  purchases or tender
offers. Pursuant to the Partnership Agreement, unitholders holding a majority of
the Units are entitled to take action with respect to a variety of matters, that
include, but are not limited to, voting on certain amendments to the Partnership
Agreement  and voting to remove the  Corporate  General  Partner.  Although  the
Corporate  General Partner owes fiduciary  duties to the limited partners of the
Partnership,  the Corporate  General partner also owes fiduciary duties to AIMCO
as its sole  stockholder.  As a  result,  the  duties of the  Corporate  General
Partner,  as  corporate  general  partner,  to the  Partnership  and its limited
partners may come into conflict with the duties of the Corporate General Partner
to AIMCO as its sole stockholder.

Recent Accounting Pronouncements

As of December 31, 2004,  the  Partnership  adopted FASB  Interpretation  No. 46
"Consolidation  of  Variable  Interest  Entities"  (or "FIN 46") and applied its
requirements to all Local Limited  Partnerships in which the Partnership  held a
variable interest. FIN 46 addresses the consolidation by business enterprises of
variable interest entities. Generally, a variable interest entity, or VIE, is an
entity with one or more of the following  characteristics:  (a) the total equity
investment  at risk is not  sufficient  to  permit  the  entity to  finance  its
activities without additional subordinated financial support; (b) as a group the
holders of the equity  investment at risk lack (i) the ability to make decisions
about  an  entity's  activities  through  voting  or  similar  rights,  (ii) the
obligation  to absorb the expected  losses of the entity,  or (iii) the right to
receive the expected residual returns of the entity; or (c) the equity investors
have voting rights that are not  proportional  to their  economic  interests and
substantially all of the entity's activities either involve, or are conducted on
behalf of, an investor that has  disproportionately  few voting  rights.  FIN 46
requires a VIE to be consolidated in the financial statements of the entity that
is determined to be the primary  beneficiary of the VIE. The primary beneficiary
generally  is the  entity  that will  receive a majority  of the VIE's  expected
losses, receive a majority of the VIE's expected residual returns, or both.

Upon adoption of FIN 46, the Partnership  determined it held variable  interests
in eight VIE's for which the Partnership was not the primary beneficiary.  Those
nine  VIE's  consist  of Local  Limited  Partnerships  in which the  Partnership
acquired an interest  prior to the adoption of FIN 46 that are directly  engaged
in the ownership and management of nine apartment properties with a total of 507
units. The Partnership is involved with those VIE's as a non-controlling limited
partner equity holder. The Partnership's maximum exposure to loss as a result of
its involvement with the  unconsolidated  VIE's is limited to the  Partnership's
recorded  investments  in and  receivables  from these VIE's,  which was zero at
December 31, 2004. The  Partnership  may be subject to additional  losses to the
extent of any financial support that the Partnership voluntarily provides in the
future.

Critical Accounting Policies and Estimates

A summary of the Partnership's  significant  accounting  policies is included in
"Note 2 - Organization and Summary of Significant  Accounting Policies" which is
included  in  the  consolidated  financial  statements  in  "Item  7.  Financial
Statements".   The  Corporate  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
consolidated  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.

Method of Accounting for Investments in Limited Partnerships

The  Partnership,  as a limited  partner,  does not  exercise  control  over the
activities and operations,  including  refinancing or selling decisions,  of the
Local  Limited  Partnerships.  Accordingly,  the  Partnership  accounts  for its
investments  in the Local  Limited  Partnerships  using the equity  method.  The
Partnership  is allocated  profits and losses of the Local Limited  Partnerships
based upon its respective  ownership  percentage  (between 98% and 99.99%).  The
Partnership  is also entitled to 99% of the profits and losses of REA IV. REA IV
is entitled to a 99% interest in each of the Local Limited Partnerships in which
it has invested.  Distributions of surplus cash from operations from most of the
Local Limited  Partnerships  are  restricted by the Local Limited  Partnerships'
Regulatory  Agreements  with the United  States  Department of Housing and Urban
Development  ("HUD").  These  restrictions  limit the distribution to a portion,
generally  less than 10%, of the initial  invested  capital.  The excess surplus
cash is  deposited  into a  residual  receipts  reserve,  of which the  ultimate
realization by the  Partnership  is uncertain as HUD frequently  retains it upon
sale or  dissolution  of the  Local  Limited  Partnership.  The  Partnership  is
allocated  profits and losses and receives  distributions  from refinancings and
sales in accordance with the Local Limited Partnerships' partnership agreements.
These  agreements  usually limit the  Partnership's  distributions  to an amount
substantially   less  than  its  ownership   percentage  in  the  Local  Limited
Partnership.

The individual  investments are carried at cost plus the Partnership's  share of
the Local  Limited  Partnership's  profits less the  Partnership's  share of the
Local Limited  Partnership's  losses,  distributions and impairment charges. See
"Note 2 -  Organization  and Summary of Significant  Accounting  Policies" for a
description of the impairment  policy. The Partnership is not legally liable for
the obligations of the Local Limited Partnerships and is not otherwise committed
to provide additional support to them.  Therefore,  it does not recognize losses
once its  investment  in each of the Local  Limited  Partnerships  reaches zero.
Distributions  from  the  Local  Limited  Partnerships  are  accounted  for as a
reduction of the investment  balance until the investment  balance is reduced to
zero.  When  the  investment  balance  has  been  reduced  to  zero,  subsequent
distributions received are recognized as income in the accompanying consolidated
statements of operations.

For those  investments  where the  Partnership  has determined that the carrying
value  of its  investments  approximates  the  estimated  fair  value  of  those
investments,  the  Partnership's  policy is to recognize equity in income of the
Local  Limited  Partnerships  only to the extent of  distributions  received and
amortization  of  acquisition  costs  from  those  Local  Limited  Partnerships.
Therefore,  the  Partnership  limits its  recognition of equity  earnings to the
amount it expects to ultimately realize.


<PAGE>



Item 7.     Financial Statements

Real Estate Associate Limited VII

List of Financial Statements

      Report of Independent Registered Public Accounting Firm

      Consolidated Balance Sheet - December 31, 2004

      Consolidated  Statements of  Operations - Years ended  December 31, 2004
      and 2003

      Consolidated  Statements  of Changes in Partners'  Deficit - Years ended
      December 31, 2004 and 2003

      Consolidated Statements of Cash Flows - Years ended December 31, 2004
      and 2003

      Notes to Consolidated Financial Statements


<PAGE>



           Report of Independent Registered Public Accounting Firm






The Partners
Real Estate Associates Limited VII

We have  audited  the  accompanying  consolidated  balance  sheet of Real Estate
Associates  Limited VII as of December  31, 2004,  and the related  consolidated
statements of operations,  partners'  deficit and cash flows for each of the two
years in the period ended December 31, 2004. 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 the standards of the Public  Company
Accounting Oversight Board (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.  We were not engaged to perform an
audit of the Partnership's internal control over financial reporting.  Our audit
included  consideration of internal control over financial  reporting as a basis
for designing audit  procedures that are appropriate in the  circumstances,  but
not for the  purpose  of  expressing  an  opinion  on the  effectiveness  of the
Partnership's internal control over financial reporting. Accordingly, we express
no such opinion.  An audit also includes  examining,  on a test basis,  evidence
supporting the amounts and  disclosures in the financial  statements,  assessing
the accounting principles used and significant estimates made by management, and
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  consolidated  financial  position  of Real Estate
Associates Limited VII at December 31, 2004, and the consolidated results of its
operations  and its cash  flows  for each of the two years in the  period  ended
December 31, 2004, in conformity with accounting  principles  generally accepted
in the United States.

The accompanying  consolidated  financial statements have been prepared assuming
that the Partnership  will continue as a going concern.  As more fully described
in Note 1 to the consolidated financial statements, the Partnership continues to
generate  recurring  operating  losses.  In addition,  notes payable and related
accrued  interest  totaling  approximately  $19,582,000  are in  default  due to
non-payment.  These conditions raise  substantial  doubt about the Partnership's
ability to continue as a going  concern.  Management's  plans in regard to these
matters are also described in Note 1. The consolidated  financial  statements do
not  include  any  adjustments  to reflect the  possible  future  effects on the
recoverability and  classification of assets or the amounts and  classifications
of liabilities that may result from the outcome of this uncertainty.



                                                          /s/Ernst & Young LLP
Greenville, SC
April 7, 2005


<PAGE>






                       REAL ESTATE ASSOCIATES LIMITED VII

                           CONSOLIDATED BALANCE SHEET

                                DECEMBER 31, 2004
                                 (in thousands)
<TABLE>
<CAPTION>


                        Assets

<S>                                       <C>                                  <C>
Investments in limited partnerships (Note 3)                                   $ --
Cash and cash equivalents                                                       2,683
     Total assets                                                             $ 2,683

          Liabilities and Partners' Deficit

Liabilities:
   Notes payable, in default (Notes 1 and 4)                                  $ 6,840
   Accrued interest payable, in default
     (Notes 1 and 4)                                                           12,742
   Accounts payable and accrued expenses                                          150
                                                                               19,732
Contingencies (Note 7)

Partners' deficit:
   General partners                                         $ (494)
   Limited partners                                         (16,555)          (17,049)
        Total liabilities and partners' deficit                               $ 2,683

          See Accompanying Notes to Consolidated Financial Statements
</TABLE>



<PAGE>



                       REAL ESTATE ASSOCIATES LIMITED VII

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                    (in thousands, except per interest data)

                                                     Years Ended December 31,
                                                     2004               2003
Revenues:
  Interest income                                    $ 15                $ 4
  Other income                                          --                   9
     Total revenues                                     15                  13
Operating expenses:
  Management fees - partners (Note 5)                  266                 325
  General and administrative (Note 5)                  177                  98
  Legal and accounting                                 244                 195
  Interest                                             718                 934
        Total operating expenses                     1,405               1,552

Loss from Partnership operations                    (1,390)             (1,539)
Gain on sale of limited partnership
  interests (Note 3)                                    --               2,604
Gain on extinguishment of debt (Note 4)                 --               4,812
Distributions in excess of investment in
  limited partnerships (Note 3)                      6,769                  29
Advances to limited partnerships charged
  to expense                                           (39)                 --
Net income                                         $ 5,340             $ 5,906

Net income allocated to general partners
  (1%)                                               $ 53               $ 59
Net income allocated to limited partners
  (99%)                                              5,287               5,847
                                                   $ 5,340             $ 5,906
Net income per limited partnership
  interest (Note 2)                                $341.65             $377.10

          See Accompanying Notes to Consolidated Financial Statements



<PAGE>



                       REAL ESTATE ASSOCIATES LIMITED VII

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

<TABLE>
<CAPTION>

                                                  General           Limited
                                                 Partners          Partners         Total

<S>                                                                  <C>
Partnership interests (A)                                            15,449

Partners' Deficit, December 31, 2002                (606)            (27,689)      (28,295)

Net income for the year ended
  December 31, 2003                                   59              5,847          5,906

Partners' Deficit, December 31, 2003              $ (547)          $(21,842)      $(22,389)

Net income for the year ended
  December 31, 2004                                   53              5,287          5,340

Partners' Deficit, December 31, 2004              $ (494)          $(16,555)      $(17,049)




(A) Consists of 15,449  interests at December  31, 2004 and 15,475  interests at
  December 31, 2003.  During 2004 and 2003, 26 and 30 interests were  abandoned,
  respectively (Notes 2 and 9).

          See Accompanying Notes to Consolidated Financial Statements
</TABLE>

                       REAL ESTATE ASSOCIATES LIMITED VII

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

                                                                          Years Ended
                                                                          December 31,
                                                                      2004            2003
Cash flows from operating activities:
<S>                                                                 <C>             <C>
  Net income                                                        $ 5,340         $ 5,906
  Adjustments to reconcile net income to net cash used in
   operating activities:
     Gain on sale of limited partnership interests                        --          (2,604)
     Gain on extinguishment of debt                                       --          (4,812)
     Distributions received from local limited partnership
      sale of investment property                                     (6,631)             --
     Advances to limited partnerships charged to expense                  39              --
     Changes in accounts:
      Due from affiliates, net                                            --              10
      Accrued interest payable                                        (1,591)         (1,326)
      Accounts payable and accrued expenses                               45              99
      Accrued fees due to affiliates                                     (54)            (27)
         Net cash used in operating activities                        (2,852)         (2,754)

Cash flows from investing activities:
  Distributions received from local limited partnership
   sale of investment property                                         6,631              --
  Proceeds from sale of limited partnership interests                     --           2,604
  Advances to limited partnerships                                        --             (73)
  Repayment of advances to limited partnerships                            7             174
         Net cash provided by investing activities                     6,638           2,705

Cash flows from financing activities:
  Repayments on notes payable                                         (1,340)             --
  Repayment of advance from affiliate                                    (30)             --
  Advance from affiliate                                                  30              --
         Net cash used in financing activities                        (1,340)             --

Net increase (decrease) in cash and cash equivalents                   2,446             (49)
Cash and cash equivalents, beginning of year                             237             286
Cash and cash equivalents, end of year                              $ 2,683          $ 237
Supplemental disclosure of cash flow information:

  Cash paid for interest                                            $ 2,275         $ 2,260
Supplemental disclosure of non-cash activity:

  Transfer of debt to purchaser of South Glen limited
   partnership                                                        $ --          $ 2,517
  Extinguishment of debt related to Henrico limited
   partnership                                                        $ --          $ 2,295
  Reduction of accrued interest on Tradewinds East note
   payable                                                            $ 34            $ --


          See Accompanying Notes to Consolidated Financial Statements
</TABLE>

                       REAL ESTATE ASSOCIATES LIMITED VII

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2004


Note 1 - Going Concern

The accompanying  consolidated  financial statements have been prepared assuming
the Partnership will continue as a going concern.  The Partnership  continues to
generate recurring operating losses. In addition,  the Partnership is in default
on notes  payable and related  accrued  interest  payable for notes payable that
matured between December 1999 and December 2004.

Eleven of the  Partnership's  twenty-three  investments  involved  purchases  of
partnership interests from partners who subsequently withdrew from the operating
partnership.  The  Partnership  is obligated for  non-recourse  notes payable of
approximately  $6,840,000 to the sellers of the partnership  interests,  bearing
interest at 9.5 to 10 percent.  Total  outstanding  accrued interest at December
31,  2004 is  approximately  $12,742,000.  These  obligations  and  the  related
interest are collaterized by the  Partnership's  investment in the Local Limited
Partnerships  and are  payable  only out of cash  distributions  from the  Local
Limited  Partnerships,  as  defined  in the notes.  Unpaid  interest  was due at
maturity of the notes. All notes payable are in default at December 31, 2004.

In  August  2004,   approximately  $1,340,000  in  principal  and  approximately
$2,275,000  in related  accrued  interest  was repaid as a result of the sale of
Rand  Grove (as  discussed  in Note 3). The  Partnership  has not made any other
payments  during the year ended  December  31, 2004 and is in default  under the
terms of the notes.  Management  is  attempting  to negotiate  extensions of the
maturity dates on the notes payable.  If the negotiations are unsuccessful,  the
Partnership  could lose its  investment  in the Local  Limited  Partnerships  to
foreclosure.  In addition,  the Partnership may seek operating advances from the
general partner of the Partnership.  However,  the Corporate  General Partner is
not obligated to fund such advances.

As a result of the above,  there is  substantial  doubt about the  Partnership's
ability to continue as a going concern. The consolidated financial statements do
not  include  any  adjustments  to reflect the  possible  future  effects of the
recoverability  and  classification of assets or amounts and  classifications of
liabilities that may result from these uncertainties.

Note 2 - Organization and Summary of Significant Accounting Policies

Organization

The Partnership was formed under the California  Limited  Partnership Act on May
24,  1983.  The  Partnership  was formed to invest  primarily  in other  limited
partnerships or joint ventures which own and operate primarily federal, state or
local  government-assisted   housing  projects.  The  general  partners  of  the
Partnership are National Partnership Investments Corp. ("NAPICO"),  a California
Corporation  (the  "Corporate  General  Partner"),   and  National   Partnership
Investments Associates II ("NAPIA II"). NAPIA II is a limited partnership formed
under the  California  Limited  Partnership  Act and consists of Mr.  Charles H.
Boxenbaum  as the  general  partner  and two  unrelated  individuals  as limited
partners. The business of the Partnership is conducted primarily by NAPICO.

On December 3, 2001, Casden Properties Inc., entered into a merger agreement and
certain other  transaction  documents with  Apartment  Investment and Management
Company ("AIMCO"), a publicly traded real estate investment trust and certain of
its  subsidiaries,  pursuant to which, on March 11, 2002,  AIMCO acquired Casden
Properties Inc. and its subsidiaries,  including 100% of the outstanding capital
stock of NAPICO.  Prior to March 11, 2002, Casden Properties Inc. owned a 95.25%
economic  interest  in  NAPICO,  with the  balance  owned by  Casden  Investment
Corporation ("CIC").  CIC, which is wholly owned by Alan I. Casden, owned 95% of
the voting common stock of NAPICO prior to March 11, 2002.

The general  partners  have a one percent  interest in profits and losses of the
Partnership.  The limited  partners  have the  remaining 99 percent  interest in
proportion to their respective investments.

The  Partnership  shall be  dissolved  only upon the  expiration  of 50 complete
calendar  years  (December  31,  2033)  from  the date of the  formation  of the
Partnership  or the  occurrence  of various  other  events as  specified  in the
Partnership agreement.

Upon total or partial  liquidation  of the  Partnership  or the  disposition  or
partial  disposition of a project or project  interest and  distribution  of the
proceeds,  the  general  partners  will  be  entitled  to a  liquidation  fee as
stipulated  in the  Partnership  Agreement.  The  limited  partners  will have a
priority return equal to their invested  capital  attributable to the project(s)
or project interest(s) sold and shall receive from the sale of the project(s) or
project  interest(s) an amount sufficient to pay state and federal income taxes,
if any, calculated at the maximum rate then in effect. The general partners' fee
may  accrue  but shall not be paid  until the  limited  partners  have  received
distributions equal to 100 percent of their capital contributions.

Basis of Presentation

The  accompanying  consolidated  financial  statements  have  been  prepared  in
conformity with accounting principles generally accepted in the United States.

Principles of Consolidation

These  consolidated  financial  statements  include the  accounts of Real Estate
Associates  Limited VII and Real Estate  Associates  IV ("REA IV"), a California
general  partnership  in which the  Partnership  holds 99 percent of the general
partner  interest.  Losses in  excess  of the  minority  investment  that  would
otherwise  be  attributed  to the minority  interest are being  allocated to the
Partnership.

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.

Method of Accounting for Investments in Limited Partnerships

The investments in limited partnerships are accounted for on the equity method.

Net Income Per Limited Partnership Interest

Net income per limited partnership interest was computed by dividing the limited
partners'  share of net income by the number of  limited  partnership  interests
outstanding  at the  beginning  of the year.  The number of limited  partnership
interests  used was 15,475 and 15,505 for the years ended  December 31, 2004 and
2003, respectively.

Cash and Cash Equivalents

Cash and cash equivalents includes cash on hand and in bank accounts. At certain
times,  the amount of cash  deposited  at a bank may exceed the limit on insured
deposits.  Cash balances include  approximately  $2,683,000 at December 31, 2004
that are maintained by an affiliated  management company on behalf of affiliated
entities in a cash concentration account.

Impairment of Long-Lived Assets

The  Partnership  reviews its  investments in long-lived  assets to determine if
there has been any  impairment  whenever  events  or  changes  in  circumstances
indicate that the carrying  amount of the asset may not be  recoverable.  If the
sum of the expected  future cash flows is less than the  carrying  amount of the
assets, the Partnership recognizes an impairment loss. No impairment losses were
recognized during the years ended December 31, 2004 and 2003.

Segment Reporting

Statement of Financial  Accounting Standards ("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. SFAS
No. 131 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.

Fair Value of Financial Instruments

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.  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  amount of its  financial  instruments
approximates  their  fair  value  due  to  the  short  term  maturity  of  these
instruments.

Recent Accounting Pronouncements

As of December 31, 2004,  the  Partnership  adopted FASB  Interpretation  No. 46
"Consolidation  of  Variable  Interest  Entities"  (or "FIN 46") and applied its
requirements to all Local Limited  Partnerships in which the Partnership  held a
variable interest. FIN 46 addresses the consolidation by business enterprises of
variable interest entities. Generally, a variable interest entity, or VIE, is an
entity with one or more of the following  characteristics:  (a) the total equity
investment  at risk is not  sufficient  to  permit  the  entity to  finance  its
activities without additional subordinated financial support; (b) as a group the
holders of the equity  investment at risk lack (i) the ability to make decisions
about  an  entity's  activities  through  voting  or  similar  rights,  (ii) the
obligation  to absorb the expected  losses of the entity,  or (iii) the right to
receive the expected residual returns of the entity; or (c) the equity investors
have voting rights that are not  proportional  to their  economic  interests and
substantially all of the entity's activities either involve, or are conducted on
behalf of, an investor that has  disproportionately  few voting  rights.  FIN 46
requires a VIE to be consolidated in the financial statements of the entity that
is determined to be the primary  beneficiary of the VIE. The primary beneficiary
generally  is the  entity  that will  receive a majority  of the VIE's  expected
losses, receive a majority of the VIE's expected residual returns, or both.

Upon adoption of FIN 46, the Partnership  determined it held variable  interests
in eight VIE's for which the Partnership was not the primary beneficiary.  Those
nine  VIE's  consist  of Local  Limited  Partnerships  in which the  Partnership
acquired an interest  prior to the adoption of FIN 46 that are directly  engaged
in the ownership and management of nine apartment properties with a total of 507
units. The Partnership is involved with those VIE's as a non-controlling limited
partner equity holder. The Partnership's maximum exposure to loss as a result of
its involvement with the  unconsolidated  VIE's is limited to the  Partnership's
recorded  investments  in and  receivables  from these VIE's,  which was zero at
December 31, 2004. The  Partnership  may be subject to additional  losses to the
extent of any financial support that the Partnership voluntarily provides in the
future.

Note 3 - Investments in Limited Partnerships

As of December 31, 2004, the Partnership holds limited partnership  interests in
12 Local Limited  Partnerships.  In addition,  the  Partnership  holds a general
partner  interest in Real Estate  Associates IV ("REA IV"), which in turn, holds
limited partner interests in 11 additional Local Limited Partnerships. NAPICO is
also a general  partner in REA IV. In total,  therefore  the  Partnership  holds
interests,  either  directly or  indirectly  through REA IV, in 23 Local Limited
Partnerships  which own  residential  low income rental  projects  consisting of
1,667  apartment  units.  The mortgage loans of these projects are payable to or
insured by various governmental agencies.

The  Partnership,  as a limited  partner,  does not  exercise  control  over the
activities and operations,  including  refinancing or selling decisions,  of the
Local  Limited  Partnerships.  Accordingly,  the  Partnership  accounts  for its
investments  in the Local  Limited  Partnerships  using the equity  method.  The
Partnership  is allocated  profits and losses of the Local Limited  Partnerships
based upon its respective  ownership  percentage  (between 98% and 99.99%).  The
Partnership  is also entitled to 99% of the profits and losses of REA IV. REA IV
is entitled to a 99% interest in each of the Local Limited Partnerships in which
it has invested.  Distributions of surplus cash from operations from most of the
Local Limited  Partnerships  are  restricted by the Local Limited  Partnerships'
Regulatory  Agreements  with the United  States  Department of Housing and Urban
Development  ("HUD").  These  restrictions  limit the distribution to a portion,
generally  less than 10%, of the initial  invested  capital.  The excess surplus
cash is  deposited  into a  residual  receipts  reserve,  of which the  ultimate
realization by the  Partnership  is uncertain as HUD frequently  retains it upon
sale or  dissolution  of the  Local  Limited  Partnership.  The  Partnership  is
allocated  profits and losses and receives  distributions  from refinancings and
sales in accordance with the Local Limited Partnerships' partnership agreements.
These  agreements  usually limit the  Partnership's  distributions  to an amount
substantially   less  than  its  ownership   percentage  in  the  Local  Limited
Partnership.

The individual  investments are carried at cost plus the Partnership's  share of
the Local  Limited  Partnership's  profits less the  Partnership's  share of the
Local Limited  Partnership's  losses,  distributions and impairment charges. See
"Note 2 -  Organization  and Summary of Significant  Accounting  Policies" for a
description of the impairment  policy. The Partnership is not legally liable for
the obligations of the Local Limited Partnerships and is not otherwise committed
to provide additional support to them.  Therefore,  it does not recognize losses
once its  investment  in each of the Local  Limited  Partnerships  reaches zero.
Distributions  from  the  Local  Limited  Partnerships  are  accounted  for as a
reduction of the investment  balance until the investment  balance is reduced to
zero.  When  the  investment  balance  has  been  reduced  to  zero,  subsequent
distributions received are recognized as income in the accompanying consolidated
statements of operations.

For those  investments  where the  Partnership  has determined that the carrying
value  of its  investments  approximates  the  estimated  fair  value  of  those
investments,  the  Partnership's  policy is to recognize equity in income of the
Local  Limited  Partnerships  only to the extent of  distributions  received and
amortization  of  acquisition  costs  from  those  Local  Limited  Partnerships.
Therefore,  the  Partnership  limits its  recognition of equity  earnings to the
amount it expects to ultimately realize.

The   Partnership  has  no  carrying  value  in  investments  in  Local  Limited
Partnerships as of December 31, 2004.

During the year ended December 31, 2004, the Partnership received  approximately
$3,023,000  in net cash  proceeds  from the sale of the  property  owned by Rand
Grove Village  Partnership  to a third party on August 3, 2004.  This amount was
net of  approximately  $1,340,000  in principal  repayments  and  $2,275,000  in
interest  repayments on non-recourse  notes payable (See Note 4). After applying
approximately  $7,000 for the repayment of an advance,  the total gross proceeds
of approximately  $6,630,000 were recognized  during the year ended December 31,
2004 as a  distribution  in excess of investment in limited  partnership  as the
Partnership  had  no  remaining   investment   related  to  this  Local  Limited
Partnership at December 31, 2004.

In  December  2003,  the  Partnership  sold  its  interest  in  Henrico  limited
partnership  and  realized a gain on sale of limited  partnership  interests  of
approximately $2,322,000.  The gain is equal to the net proceeds received by the
Partnership as the Partnership had no remaining investment related to this Local
Limited  Partnership.  The Partnership used approximately  $2,260,000 of the net
proceeds to repay a portion of the interest on the non-recourse  note payable in
full satisfaction of the note. The remaining  principal balance of approximately
$1,675,000 and related accrued interest of approximately  $620,000 was forgiven.
Accordingly,  the Partnership  recognized a gain of approximately  $2,295,000 on
the extinguishment of debt during the year ended December 31, 2003.

In  March  2003,  the  Partnership  sold its  interest  in  South  Glen  limited
partnership  and  realized a gain on sale of limited  partnership  interests  of
approximately  $232,000 for the year ended  December 31, 2003. The gain is equal
to the net  proceeds  received  by the  Partnership  as the  Partnership  had no
remaining investment related to this Local Limited Partnership.  In addition, as
part of the sale, the Partnership's obligation on the past due non-recourse note
payable  of   approximately   $970,000  and  the  related  accrued  interest  of
approximately  $1,547,000 was  transferred to the  purchaser.  Accordingly,  the
Partnership recognized a gain of approximately  $2,517,000 on the extinguishment
of debt during the year ended December 31, 2003.

During August 2002, the Partnership  purchased from the holder the matured notes
owed  by DPM  Associates,  which  is a  limited  partner  of the  Local  Limited
Partnership  which owns Danbury Park Manor,  with a face value of $1,150,000 and
related  accrued  interest  of  approximately   $1,800,000,   for  approximately
$765,000.  In October 2002,  the Local Limited  Partnership  sold its investment
property.  The Partnership received proceeds of approximately  $1,502,000 during
2002 in payment of its  advances  and  repayment  of the notes it  purchased  in
August 2002.  During the year ended  December 31, 2003,  additional  proceeds of
approximately  $50,000  were  received  by the  Partnership  and  recorded as an
additional gain on the sale for the year ended December 31, 2003.

Although the  Partnership's  recorded value of its investments and its equity in
income and/or distributions from the Local Limited Partnerships are individually
not material to the overall financial position of the Partnership, the following
are  summaries  of  the  unaudited  condensed  combined  balance  sheet  of  the
aforementioned  Local  Limited  Partnerships  as of December 31,  2004,  and the
unaudited combined results of operations for each of the two years in the period
ended  December  31,  2004 (2003  amounts  have been  restated  to  exclude  the
operations of Rand Grove Village,  which sold its investment  property on August
3, 2004):

                           CONDENSED COMBINED BALANCE SHEET
                          OF THE LOCAL LIMITED PARTNERSHIPS
                               (in thousands-unaudited)
                                                            December 31, 2004
Assets:
  Land                                                           $ 1,841
  Buildings and improvements, net of accumulated
   depreciation of approximately $30,473                          15,845
  Other assets                                                     6,353
      Total assets                                               $24,039
Liabilities and Partners' Deficit:
  Mortgage notes payable                                         $20,311
  Notes payable                                                    3,085
  Accrued interest on notes payable                                5,467
  Other liabilities                                                2,636
                                                                  31,499

Partners' Deficit                                                 (7,460)

      Total Liabilities and Partners' Deficit                    $24,039

                       CONDENSED COMBINED RESULTS OF OPERATIONS
                          OF THE LOCAL LIMITED PARTNERSHIPS
                               (in thousands-unaudited)
<TABLE>
<CAPTION>
                                                         Years Ended December 31,
                                                           2004             2003
                                                                         (Restated)
Revenues:
<S>                                                     <C>              <C>
   Rental and other                                     $  9,776         $  9,429

Expenses:
  Depreciation and amortization                            1,466            1,453
  Interest                                                   994              715
  Operating                                                7,817            7,706
    Total expenses                                        10,277            9,874

Net loss                                                $   (501)        $   (445)
</TABLE>

Under recently adopted law and policy,  the United States  Department of Housing
and Urban Development ("HUD") has determined not to renew the Housing Assistance
Payment  ("HAP")  Contracts  on a long  term  basis on the  existing  terms.  In
connection with renewals of the HAP Contracts under such new law and policy, the
amount of rental  assistance  payments under renewed HAP Contracts will be based
on market rentals instead of above market  rentals,  which may be the case under
existing HAP Contracts.  The payments under the renewed HAP Contracts may not be
in an amount  that  would  provide  sufficient  cash  flow to  permit  owners of
properties  subject to HAP  Contracts to meet the debt service  requirements  of
existing  loans  insured by the Federal  Housing  Administration  of HUD ("FHA")
unless such mortgage loans are  restructured.  In order to address the reduction
in payments under HAP Contracts as a result of this new policy, the Multi-family
Assisted Housing Reform and  Affordability  Act of 1997 ("MAHRAA")  provides for
the  restructuring  of  mortgage  loans  insured  by the  FHA  with  respect  to
properties  subject  to the  Section 8 program.  Under  MAHRAA,  an  FHA-insured
mortgage  loan can be  restructured  into a first  mortgage  loan  which will be
amortized on a current basis and a low interest  second mortgage loan payable to
FHA which will only be payable on  maturity  of the first  mortgage  loan.  This
restructuring results in a reduction in annual debt service payable by the owner
of the  FHA-insured  mortgage  loan and is  expected  to result in an  insurance
payment from FHA to the holder of the  FHA-insured  loan due to the reduction in
the principal amount. MAHRAA also phases out project-based subsidies on selected
properties  serving  families not located in rental markets with limited supply,
converting such subsidies to a tenant-based subsidy.

When the HAP  Contracts are subject to renewal,  there can be no assurance  that
the Local Limited  Partnerships  in which the Partnership has an investment will
be permitted to restructure its mortgage indebtedness under MAHRAA. In addition,
the  economic  impact  on the  Partnership  of the  combination  of the  reduced
payments  under  the  HAP  Contracts  and  the  restructuring  of  the  existing
FHA-insured mortgage loans under MAHRAA is uncertain.

Note 4 - Notes Payable

Certain of the  Partnership's  investments  involved  purchases  of  partnership
interests   from   partners  who   subsequently   withdrew  from  the  operating
partnership.   As  of  December  31,  2004,  the  Partnership  is  obligated  on
non-recourse  notes payable of approximately  $6,840,000 bearing interest at 9.5
to 10 percent, to the sellers of the partnership interests.  Accrued interest is
approximately  $12,742,000  as of December 31, 2004. The notes  originally  were
scheduled to mature  between  December  1999 and December  2004.  The  Corporate
General Partner of the Partnership  negotiated an extension of the maturity date
of the non-recourse note payable related to Tradewinds East Limited  Partnership
to December 31, 2004. These obligations and related interest are  collateralized
by the  Partnership's  investments  in the Local  Limited  Partnerships  and are
payable  only out of cash  distributions  from  the  investee  partnerships,  as
defined in the notes.  Unpaid  interest  was due at maturity  of the notes.  All
notes are in default at December 31, 2004.

During the year ended  December 31, 2004,  the  Partnership  paid  approximately
$1,340,000  in  principal  payments  and  approximately  $2,275,000  in  accrued
interest  payments  from proceeds from the sale of Rand Grove in August 2004, as
discussed in Note 3. There were no principal or interest  payments made on these
notes during the year ended  December  31, 2003.  Management  is  attempting  to
negotiate  extensions  of the  maturity  dates  on  the  notes  payable.  If the
negotiations are unsuccessful, the Partnership could lose its investments in the
Local Limited Partnerships to foreclosure.

The  Partnership  received a gross  distribution of  approximately  $39,000 from
surplus  cash from  Tradewinds  East Limited  Partnership  during the year ended
December  31,  2004.  Approximately  $34,000  was  sent  to  the  holder  of the
Tradewinds  East note  payable,  which was  applied  to  accrued  interest.  The
Partnership received the remaining cash of approximately $5,000.

In connection with the sale of the partnership  interest in Henrico in 2003 (see
Note 3), the Partnership  paid  approximately  $2,260,000 in accrued interest on
the non-recourse  note payable in full  satisfaction of the note during the year
ended  December 31,  2003.  The  remaining  principal  and interest  aggregating
approximately   $2,295,000  was  forgiven.  The  Partnership  had  no  remaining
investment related to this Local Limited Partnership.

During the year ended  December 31, 2003, the  Partnership  reached a settlement
with both the  general  partner and the  holders of the  non-recourse  notes and
related accrued  interest payable related to South Glen Limited Dividend Housing
Association. The Partnership received net proceeds of approximately $232,000 for
the purchase of REAL VII's partnership  interest and resolution of disputes with
noteholders.  The Partnership had no remaining  investment related to this Local
Limited  Partnership at December,  2003, and  accordingly,  recognized a gain of
approximately   $2,517,000  on  the  extinguishment  of  debt  related  to  this
transaction.

During  the year  ended  December  31,  2003,  the  Partnership  entered  into a
settlement  agreement with the general partner of Rand Grove Village Partnership
wherein the general partner of the Local Limited  Partnership would purchase the
property in full satisfaction of the non-recourse note payable.  The Partnership
received  approximately  $100,000  during the year ended  December 31, 2003 as a
deposit pursuant to this settlement agreement.  During 2004, the general partner
of the Local Limited  Partnership  filed a motion to vacate such agreement.  The
general  partner's motion to vacate the settlement order was denied on April 20,
2004.  The  Partnership  recognized  the deposit as income during the year ended
December 31, 2004.  Also see Note 3 discussion  of the sale of this property and
the subsequent distributions to the Partnership.

Note 5 - Transactions with Affiliated Parties

Under  the  terms  of  the  Restated   Certificate   and  Agreement  of  Limited
Partnership, the Partnership is obligated to NAPICO for an annual management fee
equal to 0.5 percent of the original  remaining invested assets of the remaining
partnerships.  Invested  assets are  defined as the costs of  acquiring  project
interests,  including the proportionate  amount of the mortgage loans related to
the   Partnership's   interest  in  the  capital   accounts  of  the  respective
partnerships.  The fee was  approximately  $266,000  and  $325,000 for the years
ended December 31, 2004 and 2003, respectively.  During the years ended December
31, 2004 and 2003,  the  Partnership  made payments of accrued fees to NAPICO of
approximately $320,000 and $352,000,  respectively,  from proceeds from the sale
of a  Local  Limited  Partnership  in  2004  and  from  the  2003  sales  of the
Partnership's interest in Local Limited Partnerships (see "Note 3").

The Partnership  reimburses  NAPICO for certain  expenses.  The reimbursement to
NAPICO was  approximately  $43,000 for each of the years ended December 31, 2004
and 2003, respectively, and are included in general and administrative expenses.

AIMCO and its  affiliates  owned  583.79 Units or 1,167.58  limited  partnership
interests in the  Partnership  representing  7.56% of the  outstanding  Units at
December 31, 2004. A unit consists of two limited partnership  interests.  It is
possible that AIMCO or its affiliates will acquire  additional Units in exchange
for cash or a  combination  of cash and  units in AIMCO  Properties,  L.P.,  the
operating  partnership  of AIMCO,  either  through  private  purchases or tender
offers. Pursuant to the Partnership Agreement, unitholders holding a majority of
the Units are entitled to take action with respect to a variety of matters, that
include, but are not limited to, voting on certain amendments to the Partnership
Agreement  and voting to remove the  Corporate  General  Partner.  Although  the
Corporate  General Partner owes fiduciary  duties to the limited partners of the
Partnership,  the Corporate  General partner also owes fiduciary duties to AIMCO
as its sole  stockholder.  As a  result,  the  duties of the  Corporate  General
Partner,  as  corporate  general  partner,  to the  Partnership  and its limited
partners may come into conflict with the duties of the Corporate General Partner
to AIMCO as its sole stockholder.

Note 6 - Income Taxes

The  Partnership  is not taxed on its income.  The  partners  are taxed in their
individual  capacities based upon their  distributive share of the Partnership's
taxable  income  or  loss  and are  allowed  the  benefits  to be  derived  from
off-setting  their  distributive  share of the tax losses against taxable income
from other sources  subject to passive loss  limitations.  The taxable income or
loss differs from  amounts  included in the  statements  of  operations  because
different  methods  are used in  determining  the  losses of the  Local  Limited
Partnerships as discussed below. The tax loss is allocated to the partner groups
in accordance with Section 704(b) of the Internal  Revenue Code and therefore is
not necessarily proportionate to the interest percentage owned.

A  reconciliation  is as follows (in thousands,  except per limited  partnership
interest):

                                                  Years Ended December 31,
                                                     2004            2003

Net income per financial statements                $ 5,340         $ 5,906

  Other                                              1,257          (3,585)
  Partnership's share of limited local
   Partnership                                        (173)          3,737
Income per tax return                              $ 6,424         $ 6,058

Net income per limited partnership interest         $ 814           $ 383

The following is a reconciliation between the Partnership's reported amounts and
the federal tax basis of net liabilities:

                                                   December 31, 2004
                                                     (in thousands)

      Net deficit as reported                          $(17,049)
      Add (deduct):
        Deferred offering costs                           5,091
        Investment in Partnerships                      (18,169)
         Accrued interest                                12,587
        Other                                            (1,573)
      Net deficit - federal tax basis                  $(19,113)

Note 7 - Contingencies

The  Corporate  General  Partner is involved in various  lawsuits  arising  from
transactions  in the ordinary  course of business.  In the opinion of management
and the Corporate  General  Partner,  the claims will not result in any material
liability to the Partnership.

As  previously  disclosed,  the  Central  Regional  Office of the United  States
Securities  and  Exchange   Commission   (the  "SEC")  is  conducting  a  formal
investigation relating to certain matters.  Although the staff of the SEC is not
limited  in the  areas  that it may  investigate,  AIMCO  believes  the areas of
investigation include AIMCO's miscalculated monthly net rental income figures in
third quarter 2003,  forecasted  guidance,  accounts payable,  rent concessions,
vendor  rebates,  capitalization  of payroll and certain  other  costs,  and tax
credit  transactions.  AIMCO is cooperating  fully. AIMCO is not able to predict
when the matter  will be  resolved.  AIMCO does not  believe  that the  ultimate
outcome  will  have a  material  adverse  effect on its  consolidated  financial
condition or results of operations.  Similarly,  the Corporate  General  Partner
does not believe that the ultimate  outcome will have a material  adverse effect
on the Partnership's consolidated financial condition or results of operations.

Note  8  -  Real  Estate  and   Accumulated   Depreciation  of  Local  Limited
         Partnerships in which REAL VII Has Invested (unaudited)

All amounts in thousands
<TABLE>
<CAPTION>

                                                         Buildings
                                        Notes               And
                                       Payable            Related
                           Mortgage  and Accrued          Personal            Accumulated
       Description          Notes     Interest     Land   Property Total(2)  Depreciation(2)
<S>                        <C>          <C>       <C>     <C>       <C>       <C>
Aristocrat Manor           $ 3,057      $ --      $ 265   $ 4,460   $ 4,725   $ 2,116
Arkansas City Apts.            487          --       22       505       527       223
Bellair Manor Apts.            661          --      153     1,547     1,700     1,057
Birch Manor Apts. I            265        1,098      61     1,323     1,384       904
Birch Manor Apts. II           541          989      50     1,387     1,437       948
Bluewater Apts.              1,287          --      130     4,445     4,575     2,668
Clarkwood Apts. I              298       1,456       69     1,532     1,601     1,047
Clarkwood Apts. II             646       2,253       93     2,628     2,721     1,796
Hampshire House              2,407          --      101     3,945     4,046     2,696
Ivywood Apts.                1,230          --      200     2,939     3,139     2,012
Jasper County Prop.            647          --       33       842       875       757
Nantucket Apts.                421          --       35     1,303     1,338       892
Newton Apts.                   981          --       55     1,132     1,187     1,071
Oak Hill Apts.               1,486          --       76     3,089     3,165     2,113
Oakview Apts.                1,085          --       75     1,180     1,255       498
Oakwood Park I Apts.           102       1,108       63       854       917       584
Oakwood Park II Apts.          206       1,648      102     1,379     1,481       942
Pachuta Apts.                  438          --       21       529       550       495
Richards Park Apts.            529          --       52     1,419     1,471       962
Shubuta Properties             435          --       23       614       637       536
Tradewinds East              1,728          --      118     5,860     5,978     3,828
Warren Heights Apts. I         881          --       22     2,203     2,225     1,506
Yorkview Estates               493          --       22     1,203     1,225       822
Total                      $20,311     $ 8,552    $1,841   $46,318   $48,159   $30,473
</TABLE>

(2) Reconciliation of real estate and accumulated depreciation (unaudited)

                                                 Years Ended December 31,
                                                   2004           2003
                                                 (in thousands-unaudited)
Real Estate

Balance at beginning of year                     $ 55,006       $ 64,957
Improvements (disposals) during the period            530            272
Loss of investments in Local Limited
 Partnerships                                      (7,377)       (10,223)
Balance at end of year                           $ 48,159       $ 55,006


                                                 Years Ended December 31,
                                                   2004           2003
                                                 (in thousands-unaudited)
Accumulated Depreciation

Balance at beginning of year                     $ 35,498       $ 42,621
Depreciation expense for the period                 1,466          1,512
Loss of investments in Local Limited
 Partnerships                                      (6,491)       (8,635)
Balance at end of year                           $ 30,473       $ 35,498

Note 9 - Abandonment Of Limited Partnership Interests

In 2004 and 2003, the number of Limited  Partnership  Interests  decreased by 26
and  30  interests  due to  limited  partners  abandoning  their  interests.  In
abandoning  his  or her  Limited  Partnership  Interest(s),  a  limited  partner
relinquishes all right, title, and interest in the partnership as of the date of
abandonment.  However,  the limited partner is allocated his or her share of net
income  or loss for that  year.  The  income  or loss  per  Limited  Partnership
Interest in the accompanying consolidated statements of operations is calculated
based on the number of interests outstanding at the beginning of the year.


<PAGE>



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

None.

Item 8a.    Controls and Procedures

(a) Disclosure Controls and Procedures.  The Partnership's management,  with the
participation of the principal executive officer and principal financial officer
of the Corporate  General Partner,  who are the equivalent of the  Partnership's
principal executive officer and principal financial officer,  respectively,  has
evaluated  the  effectiveness  of  the  Partnership's  disclosure  controls  and
procedures (as such term is defined in Rules  13a-15(e) and 15d-15(e)  under the
Securities  Exchange Act of 1934, as amended (the "Exchange Act")) as of the end
of the period covered by this report.  Based on such  evaluation,  the principal
executive  officer and  principal  financial  officer of the  Corporate  General
Partner, who are the equivalent of the Partnership's principal executive officer
and principal  financial officer,  respectively,  have concluded that, as of the
end of such period,  the  Partnership's  disclosure  controls and procedures are
effective.

(b) Internal Control Over Financial  Reporting.  There have not been any changes
in the Partnership's  internal control over financial reporting (as such term is
defined in Rules  13a-15(f)  and  15d-15(f)  under the Exchange  Act) during the
fourth quarter of 2004 that have materially  affected,  or are reasonably likely
to  materially  affect,  the  Partnership's   internal  control  over  financial
reporting.

Item 8b.    Other Information

None.



<PAGE>


                                    PART III

Item 9.     Directors and Executive Officers of the Registrant

Real Estate Associates  Limited VII (the  "Partnership" or the "Registrant") has
no officers or directors.  The general  partner  responsible  for conducting the
business  of  the  Partnership  is  National  Partnership   Investments  Corp  a
California Corporation ("NAPICO" or the "Corporate General Partner").

The names and ages of, as well as the positions and offices held by, the present
directors  and officers of NAPICO are set forth  below:  The  Corporate  General
Partner manages and controls  substantially all of the Partnership's affairs and
has general  responsibility  and ultimate authority in all matters affecting its
business.  There are no family  relationships  between or among any directors or
officers.

Harry G. Alcock                 42    Executive Vice President and
                                        Director
David R. Robertson              39    President, Chief Executive Officer
                                        and Director
Charles McKinney                53    Senior Vice President and Director
                                        of Asset Management
Jeffrey H. Sussman              39    Senior Vice President, General
                                        Counsel and Secretary
Brian H. Shuman                 42    Senior Vice President and Chief
                                        Financial Officer

Harry G. Alcock was appointed as a Director of the Corporate  General Partner in
October 2004 and was appointed Executive Vice President of the Corporate General
Partner  in  February  2004 and has been  Executive  Vice  President  and  Chief
Investment Officer of AIMCO since October 1999. Prior to October 1999 Mr. Alcock
served as a Vice President of AIMCO from July 1996 to October 1997,  when he was
promoted to Senior Vice  President  Acquisitions  where he served until  October
1999. Mr. Alcock has had responsibility for acquisition and financing activities
of AIMCO since July 1994.

David R. Robertson has been President, Chief Executive Officer and a Director of
the Corporate  General  Partner since  October 2002.  Mr.  Robertson has been an
Executive  Vice  President  of AIMCO  since  February  2002,  and was  appointed
President and Chief  Executive  Officer of AIMCO  Capital in October  2002.  Mr.
Robertson  is  responsible  for  property   operations,   asset  management  and
transaction   activities   within  AIMCO   Capital's   portfolio  of  affordable
properties,  and for  redevelopment  and  construction  activities  for both the
conventional  and  affordable  property  portfolios.  Since  February  1996, Mr.
Robertson has been Chairman and Chief Executive Officer of Robeks Corporation, a
privately held chain of specialty food stores.

Charles McKinney has been Senior Vice President and Director of Asset Management
of the  Corporate  General  Partner and AIMCO Capital since January 2003 and has
overall responsibility for monitoring the construction, lease-up, operations and
compliance  issues for all  assets  constituting  a part of  AIMCO's  affordable
portfolio.  Mr.  McKinney  joined AIMCO as Vice President of Transactions in the
Affordable  Group  in  June  2002  and  had   responsibility   for  value  added
dispositions  of  affordable  properties  in the  Western  portion of the United
States.  From  September  2000  through  May 2002,  Mr.  McKinney  was  Managing
Underwriter for Real Estate Recovery, Inc. where he was responsible for the real
estate loan underwriting and loan review for the company's  clients.  From March
1998 through August 2000, Mr.  McKinney was the Executive  Managing  Director of
American Capital Advisors, Inc. an investment banking company.

Jeffrey H. Sussman has been Senior Vice President, General Counsel and Secretary
of the Corporate  General  Partner since joining  NAPICO in 1998. Mr. Sussman is
responsible for the legal affairs of NAPICO and its affiliates. Prior to joining
NAPICO in 1998, Mr. Sussman was an associate with the law firm of Rus, Miliband,
Williams & Smith in Irvine,  California.  His  practice  emphasized  real estate
finance  and  insolvency  law and  included  the  representation  of  borrowers,
lenders, and court-appointed  trustees in matters involving apartment complexes,
retail centers and hotels.

Brian H. Shuman has been Senior Vice  President and Chief  Financial  Officer of
the  Corporate  General  Partner  since  joining  NAPICO in 2000.  Mr. Shuman is
responsible  for  the  financial  affairs  of  NAPICO  as  well  as the  limited
partnership  sponsored by it. From 1996 until joining NAPICO in August 2000, Mr.
Shuman was Vice President - Finance for Preferred  Health  Management  Inc., the
largest  provider  of  worker   compensation   diagnostic  imaging  services  in
California formed in 1996, and was responsible for establishing and managing the
accounting, billing, collection, treasury and financial reporting departments.

The board of directors of the Corporate General Partner does not have a separate
audit  committee.  As such,  the board of  directors  of the  Corporate  General
Partner fulfills the functions of an audit committee. The board of directors has
determined  that Brian H. Shuman meets the  requirement  of an "audit  committee
financial expert".

The directors and officers of the Corporate  General Partner with authority over
the Partnership are all employees of subsidiaries of AIMCO.  AIMCO has adopted a
code of ethics that applies to such  directors  and  officers  that is posted on
AIMCO's  website  (www.AIMCO.com).   AIMCO's  website  is  not  incorporated  by
reference to this filing.

Item 10.    Executive Compensation

None of the directors and officers of the Corporate General Partner received any
remuneration from the Partnership during the year ended December 31, 2004.

Item 11.    Security Ownership of Certain Beneficial Owners and Management

Security Ownership of Certain Beneficial Owners

(a)   The  General  Partners  own  all of the  outstanding  general  partnership
      interests of REAL VII; no person is known to own beneficially in excess of
      5 percent of the outstanding limited partnership interests.

The following table sets forth certain information regarding limited partnership
interests  of the  Partnership  owned by each  person  or entity as known by the
Partnership to own  beneficially or exercise voting or dispositive  control over
more than 5% of the Partnership's  limited partnership  interests as of December
31, 2004.
<TABLE>
<CAPTION>

            Name of Beneficial Owner              Number of Interests    % of Class

<S>                                                    <C>                  <C>
AIMCO Properties, L.P.                                 1,167.58             7.56%
  (affiliate of the Corporate General Partner)
</TABLE>

The business address of AIMCO Properties,  L.P. is 4582 S. Ulster St. Parkway,
Suite 1100, Denver, Colorado 80237.

(b)    None of the officers or directors of the  Corporate  General  Partner own
       directly or beneficially any limited partnership interests in REAL VII.

Item 12.    Certain Relationships and Related Transactions

Under  the  terms  of  the  Restated   Certificate   and  Agreement  of  Limited
Partnership, the Partnership is obligated to NAPICO for an annual management fee
equal to 0.5 percent of the original  remaining invested assets of the remaining
partnerships.  Invested  assets are  defined as the costs of  acquiring  project
interests,  including the proportionate  amount of the mortgage loans related to
the   Partnership's   interest  in  the  capital   accounts  of  the  respective
partnerships.  The fee was  approximately  $266,000  and  $325,000 for the years
ended December 31, 2004 and 2003, respectively.  During the years ended December
31, 2004 and 2003,  the  Partnership  made payments of accrued fees to NAPICO of
approximately $320,000 and $352,000,  respectively,  from proceeds from the sale
of a  Local  Limited  Partnership  in  2004  and  from  the  2003  sales  of the
Partnership's interest in Local Limited Partnerships (see "Note 3").

The Partnership  reimburses  NAPICO for certain  expenses.  The reimbursement to
NAPICO was  approximately  $43,000 for each of the years ended December 31, 2004
and 2003, respectively, and are included in general and administrative expenses.

AIMCO and its  affiliates  owned  583.79 Units or 1,167.58  limited  partnership
interests in the  Partnership  representing  7.56% of the  outstanding  Units at
December 31, 2004. A unit consists of two limited partnership  interests.  It is
possible that AIMCO or its affiliates will acquire  additional Units in exchange
for cash or a  combination  of cash and  units in AIMCO  Properties,  L.P.,  the
operating  partnership  of AIMCO,  either  through  private  purchases or tender
offers. Pursuant to the Partnership Agreement, unitholders holding a majority of
the Units are entitled to take action with respect to a variety of matters, that
include, but are not limited to, voting on certain amendments to the Partnership
Agreement  and voting to remove the  Corporate  General  Partner.  Although  the
Corporate  General Partner owes fiduciary  duties to the limited partners of the
Partnership,  the Corporate  General partner also owes fiduciary duties to AIMCO
as its sole  stockholder.  As a  result,  the  duties of the  Corporate  General
Partner,  as  corporate  general  partner,  to the  Partnership  and its limited
partners may come into conflict with the duties of the Corporate General Partner
to AIMCO as its sole stockholder.

ITEM 13.    Exhibits

      See Exhibit Index

Item 14.    Principal Accounting Fees and Services

The Corporate  General Partner has reappointed  Ernst & Young LLP as independent
auditors to audit the financial  statements  of the  Partnership  for 2005.  The
aggregate  fees billed for  services  rendered by Ernst & Young LLP for 2004 and
2003 are described below.

Audit Fees. Fees for audit services  totaled  approximately  $49,000 and $44,000
for 2004 and 2003,  respectively.  Fees for audit services also include fees for
the reviews of the Partnership's quarterly reports on Form 10-QSB.

Tax Fees. Fees for tax services totaled  approximately $26,000 for both 2004 and
2003.


<PAGE>


                                   SIGNATURES


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


                       REAL ESTATE ASSOCIATES LIMITED VII

                        By:   NATIONAL PARTNERSHIP INVESTMENTS CORP.
                              Corporate General Partner


                                    By:   /s/David R. Robertson
                                          David R. Robertson
                                          President and Chief Executive
                                          Officer


                                    By:   /s/Brian H. Shuman
                                          Brian H. Shuman
                                          Senior Vice President and
                                          Chief Financial Officer


                                    Date: April 7, 2005

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
dates indicated.

/s/Harry G. Alcock            Executive Vice President        Date:April 7, 2005
Harry G. Alcock                and Director


/s/David R. Robertson         President,   Chief  Executive  Date: April 7, 2005
David R. Robertson             Officer and Director


/s/Brian H. Shuman            Senior  Vice   President  and  Date: April 7, 2005
Brian H. Shuman                 Chief Financial Officer


<PAGE>


                       REAL ESTATE ASSOCIATES LIMITED VII
                                  EXHIBIT INDEX


Exhibit     Description of Exhibit

   3        Restated  Certificate and Agreement of Limited Partnership dated May
            24, 1983 filed with the Securities  and Exchange  Commission on Form
            S-11 No 2-84816, which is hereby incorporated by reference.

   31.1     Certification  of equivalent of Chief Executive  Officer pursuant to
            Securities  Exchange  Act  Rules  13a-14(a)/15d-14(a),   as  Adopted
            Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

   31.2     Certification  of equivalent of Chief Financial  Officer pursuant to
            Securities  Exchange  Act  Rules  13a-14(a)/15d-14(a),   as  Adopted
            Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

   32.1     Certification  Pursuant  to  18  U.S.C.  Section  1350,  as  Adopted
            Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.



<PAGE>




Exhibit 31.1


                                  CERTIFICATION


I, David R. Robertson, certify that:


1.    I have  reviewed  this  annual  report  on  Form  10-KSB  of  Real  Estate
      Associates Limited VII;

2.    Based on my knowledge,  this 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
      report;

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

4.    The  small  business  issuer's  other  certifying  officer(s)  and  I  are
      responsible  for  establishing  and  maintaining  disclosure  controls and
      procedures (as defined in Exchange Act Rules  13a-15(e) and 15d-15(e)) for
      the small business issuer and have:

      (a)   Designed such  disclosure  controls and  procedures,  or caused such
            disclosure   controls  and  procedures  to  be  designed  under  our
            supervision,  to ensure that  material  information  relating to the
            small business issuer, including its consolidated  subsidiaries,  is
            made  known to us by  others  within  those  entities,  particularly
            during the period in which this report is being prepared;

      (b)   Evaluated  the   effectiveness   of  the  small  business   issuer's
            disclosure  controls and procedures and presented in this report our
            conclusions about the  effectiveness of the disclosure  controls and
            procedures, as of the end of the period covered by this report based
            on such evaluation; and

      (c)   Disclosed in this report any change in the small  business  issuer's
            internal  control over financial  reporting that occurred during the
            small  business  issuer's  most  recent  fiscal  quarter  (the small
            business  issuer's  fourth  fiscal  quarter in the case of an annual
            report) that has  materially  affected,  or is reasonably  likely to
            materially affect, the small business issuer's internal control over
            financial reporting; and

5.    The  small  business  issuer's  other  certifying  officer(s)  and I  have
      disclosed,  based on our most recent  evaluation of internal  control over
      financial reporting, to the small business issuer's auditors and the audit
      committee of the small  business  issuer's  board of directors (or persons
      performing the equivalent functions):

      (a)   All significant  deficiencies and material  weaknesses in the design
            or operation of internal control over financial  reporting which are
            reasonably  likely to adversely  affect the small business  issuer's
            ability  to  record,   process,   summarize  and  report   financial
            information; and


      (b)   Any fraud,  whether or not  material,  that  involves  management or
            other  employees who have a significant  role in the small  business
            issuer's internal control over financial reporting.


Date:  April 7, 2005

                                    /s/David R. Robertson
                                    David R. Robertson
                                    President and Chief  Executive  Officer of
                                    National Partnership Investments Corp.,
                                    equivalent of the chief executive  officer
                                    of the Partnership


<PAGE>



Exhibit 31.2


                                  CERTIFICATION


I, Brian H. Shuman, certify that:


1.    I have  reviewed  this  annual  report  on  Form  10-KSB  of  Real  Estate
      Associates Limited VII;

2.    Based on my knowledge,  this 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
      report;

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

4.    The  small  business  issuer's  other  certifying  officer(s)  and  I  are
      responsible  for  establishing  and  maintaining  disclosure  controls and
      procedures (as defined in Exchange Act Rules  13a-15(e) and 15d-15(e)) for
      the small business issuer and have:

      (a)   Designed such  disclosure  controls and  procedures,  or caused such
            disclosure   controls  and  procedures  to  be  designed  under  our
            supervision,  to ensure that  material  information  relating to the
            small business issuer, including its consolidated  subsidiaries,  is
            made  known to us by  others  within  those  entities,  particularly
            during the period in which this report is being prepared;

      (b)   Evaluated  the   effectiveness   of  the  small  business   issuer's
            disclosure  controls and procedures and presented in this report our
            conclusions about the  effectiveness of the disclosure  controls and
            procedures, as of the end of the period covered by this report based
            on such evaluation; and

      (c)   Disclosed in this report any change in the small  business  issuer's
            internal  control over financial  reporting that occurred during the
            small  business  issuer's  most  recent  fiscal  quarter  (the small
            business  issuer's  fourth  fiscal  quarter in the case of an annual
            report) that has  materially  affected,  or is reasonably  likely to
            materially affect, the small business issuer's internal control over
            financial reporting; and

5.    The  small  business  issuer's  other  certifying  officer(s)  and I  have
      disclosed,  based on our most recent  evaluation of internal  control over
      financial reporting, to the small business issuer's auditors and the audit
      committee of the small  business  issuer's  board of directors (or persons
      performing the equivalent functions):

      (a)   All significant  deficiencies and material  weaknesses in the design
            or operation of internal control over financial  reporting which are
            reasonably  likely to adversely  affect the small business  issuer's
            ability  to  record,   process,   summarize  and  report   financial
            information; and


      (b)   Any fraud,  whether or not  material,  that  involves  management or
            other  employees who have a significant  role in the small  business
            issuer's internal control over financial reporting.

Date:  April 7, 2005
                                    /s/Brian H. Shuman
                                    Brian H. Shuman
                                    Senior Vice President and Chief Financial
                                    Officer of National Partnership
                                    Investments Corp., equivalent of the
                                    chief financial officer of the Partnership


<PAGE>


Exhibit 32.1


                          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 Real Estate  Associates
Limited VII (the  "Partnership"),  for the year ended December 31, 2004 as filed
with the Securities and Exchange  Commission on the date hereof (the  "Report"),
David R.  Robertson,  as the  equivalent of the chief  executive  officer of the
Partnership,  and Brian H.  Shuman,  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/David R. Robertson
                                    Name:  David R. Robertson
                                    Date:  April 7, 2005


                                           /s/Brian H. Shuman
                                    Name:  Brian H. Shuman
                                    Date:  April 7, 2005


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