SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-K

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

                   For the Fiscal Year Ended December 31, 1998

                                       OR

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

      For the transition period from __________________ to ________________

                           Commission File No. 0-13556

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

                              California 04-2817478
--------------------------------------------------------------------------------
                         (State or other jurisdiction of
                        (I.R.S. Employer incorporation or
                        organization) Identification No.)

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

                                 (719) 527-0544
--------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)

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

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

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by  Sections  13 and 15(d) of the  Securities  Exchange  Act of 1934
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days. Yes _X_ No ___

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-K or any amendment to this
Form 10-K. [ X ]

Aggregate  market  value  of  voting  securities  held  by  non-affiliates:  Not
applicable, since securities are not actively traded on any exchange.

Documents incorporated by reference:  None

The Exhibit Index is located on page F-18




<PAGE>


                                                                PART I

ITEM 1.   BUSINESS

This form 10-K contains forward-looking statements within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934.

Such forward-looking  statements involve known and unknown risks,  uncertainties
and other factors that may cause the actual results, performance or achievements
of  the  Partnership  to  be  materially  different  from  any  future  results,
performance  or  achievements   expressed  or  implied  by  the  forward-looking
statements.  Such factors include,  among other things, (i) general economic and
business conditions; (ii) governmental regulation,  including the interpretation
of tax, labor and environmental  laws; (iii) required  accounting  changes;  and
(iv) other factors over which the Partnership has little or no control.

Cluster Housing Properties (the "Partnership"), formerly Berry and Boyle Cluster
Housing  Properties,  is a California  limited  partnership  formed on August 8,
1983.  The General  Partners are Stephen B. Boyle and GP L'Auberge  Communities,
L.P., a California limited partnership, formerly Berry and Boyle Management.

The  Partnership  was formed to operate and ultimately  dispose of a diversified
portfolio of  income-producing  residential real properties  directly or through
its joint venture interest in joint venturers which own such properties.  On May
28, 1998 the Partnership sold its final property,  Pinecliff, having sold two of
its properties  during 1997.  Descriptions of such properties are included below
in "Item 2. Properties" as well as in Note 5 of Notes to Consolidated  Financial
Statements included in this report and incorporated herein by reference thereto.

As  further  discussed  in  Item 2  below  and in  Note  9 of the  Notes  to the
Consolidated Financial Statements,  after taking into consideration such factors
as the price to be realized,  the possible risks of continued  ownership and the
anticipated  advantages  to be gained for the  partners,  the  General  Partners
determined during 1997 that it would be in the best interests of the Partnership
and the  partners to dissolve  the  Partnership  and  liquidate  its assets (the
"Dissolution"). Under the provisions of the Partnership's Partnership Agreement,
the  Dissolution  of the  Partnership  requires  the  consent of a  majority  in
interest of the limited partners.  In March 1998, the General Partners requested
the consent of the limited  partners  to the  Dissolution  pursuant to a Consent
Solicitation  Statement  first mailed to the limited  partners on or about March
18, 1998.  The consent of a majority in interest of the limited  partners to the
Dissolution was obtained in May 1998.

The Partnership  sold its final real estate asset,  Pinecliff,  on May 28, 1998.
The Villas Sin Vacas and Villa  Antigua  properties  were sold  during 1997 (see
Item 2.  Properties and Note 5 of Notes to Consolidated  Financial  Statements).
The net proceeds from the sales were not reinvested by the Partnership, but were
distributed to the partners. The Partnership has retained approximately $275,000
as a reserve for contingencies and liquidation expenses.

Until its sale, on-site management of the Partnership's property, Pinecliff, was
provided by an affiliate  of the General  Partners.  The terms of such  property
management  services  between the Partnership and property manager were embodied
in a written management agreement. Property management fees were 4% of the gross
revenues from the property,  plus  reimbursement  for  allocable  expenses.  The
property  manager  was  responsible  for  on-site  operations  and  maintenance,
generation and collection of rental income and payment of operating expenses.

The  difference  between  rental  income and  expenses  related  to  operations,
including  items  such as local  taxes  and  assessments,  utilities,  insurance
premiums,  maintenance,   repairs  and  improvements  (and  reserves  therefor),
bookkeeping and payroll expenses, legal and accounting fees, property management
fees and other expenses  incurred,  constituted  the  property's  operating cash
flow.   The   Partnership's   administrative   expenses  are  paid  out  of  the
Partnership's share of such cash flow or Partnership reserves.

The  operations  of the  Partnership  were  dependent  upon  factors  which were
difficult  to  predict  and  many  of  which  were  beyond  the  control  of the
Partnership.  Such factors  include,  among  others,  general  economic and real
estate market conditions,  both on a national basis and in those areas where the
Partnership's  investments were located,  competitive  factors, the availability
and cost of borrowed funds, real estate tax rates,  federal and state income tax
laws,  operating expenses (including  maintenance and insurance),  energy costs,
government   regulations,   and  potential   liability   under  and  changes  in
environmental  and  other  laws,  as well as the  successful  management  of the
properties.

The  Partnership's  investment  in real  estate  was  also  subject  to  certain
additional  risks  including,  but not limited to, (i) competition from existing
and  future  projects  held by other  owners in the  areas of the  Partnership's
property,  (ii)  possible  reduction  in rental  income due to an  inability  to
maintain  high  occupancy  levels,  (iii) adverse  changes in mortgage  interest
rates, (iv) possible adverse changes in general economic  conditions and adverse
local conditions, such as competitive overbuilding,  or a decrease in employment
or adverse  changes in real estate zoning laws, (v) the possible future adoption
of rent control  legislation which would not permit the full amount of increased
costs to be passed on to tenants in the form of rent  increases,  and (vi) other
circumstances over which the Partnership may have had little or no control.

The Partnership's investment was subject to competition in the rental, lease and
sale of similar types of  properties in the locality in which the  Partnership's
real property investment was located.  Furthermore,  the General Partners of the
Partnership are affiliated with other partnerships  owning similar properties in
the vicinity in which the Partnership's property was located.

The  Partnership  considers  itself to have been  engaged  in only one  industry
segment, real estate investment.

ITEM 2.   PROPERTIES

The Partnership  owned and operated three properties:  (1) L'Auberge  Pinecliff,
formerly Autumn Ridge  ("Pinecliff"),  a 96-unit  multifamily rental property in
Colorado Springs, Colorado, which was sold in May 1998; (2) Villas at Sin Vacas,
a 72-unit  multifamily  rental  property in Tucson,  Arizona,  which was sold in
November 1997;  (3) Villa Antigua,  an 88-unit  multifamily  rental  property in
Scottsdale,  Arizona,  which was sold in October  1997.  The  ownership  of each
property was formerly  structured  as a Joint  Venture in which the  Partnership
owned a majority interest.  With regard to the termination of the Joint Ventures
and the  sales of  properties,  see Note 5 of  Notes to  Consolidated  Financial
Statements.

Pinecliff

On May 28, 1998,  Pinecliff was sold pursuant to the terms of the Sale Agreement
and Escrow Instruction dated January 1998, as amended. Pinecliff was sold to G&I
Pinecliff  LLC, a  Delaware  limited  liability  company  unaffiliated  with the
Partnership.  The net selling  price for Pinecliff  was  $6,248,652,  subject to
certain customary adjustments,  net of a credit to the purchaser of $360,000 for
capital improvements. The Partnership repaid mortgage financing in the amount of
$3,041,860  at  closing  utilizing  a portion  of  proceeds  from the sale.  The
Partnership  recorded  a gain  on  sale  for  financial  reporting  purposes  of
$452,214.

Villas at Sin Vacas

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

Villa Antigua

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

There are no material  pending legal  proceedings to which the Partnership or of
which any of the properties is the subject.

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No  matters  were  submitted  to a vote of  security  holders  during the fourth
quarter of 1998.


                                     PART II

ITEM 5.   MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
          SHAREHOLDER MATTERS

The  transfer  of Units is  subject  to  certain  limitations  contained  in the
Partnership  Agreement.  There is no public  market  for the Units and it is not
anticipated that any such public market will develop.

The number of Unit holders of as of December 31, 1998 was 1,902.

Distributions  are made to the Partners on a quarterly basis based upon Net Cash
from Operations,  as calculated  under Section 10 of the Partnership  Agreement.
Total cash  distributions  to the Limited Partners for 1998 and 1997, as well as
the Distributions from Proceeds of Sale were paid as follows:

                                   Date of
Quarter Ended                      Payment                         Amount
-------------                      -------                         ------
December 31, 1996               February 28, 1997               $   97,263
March 31, 1997                  May 15, 1997                    $   97,263
June 30, 1997                   August 15, 1997                 $   97,263
September 30, 1997                                              $     -
December 31, 1997               December 31, 1997               $5,349,465
May  28, 1998                   August 4, 1998                  $3,242,100


ITEM 6.   SELECTED FINANCIAL DATA

The  following  selected  financial  data of the  Partnership  and  consolidated
subsidiaries has been derived from consolidated  financial statements audited by
PricewaterhouseCoopers,  LLP,  whose reports for the periods ended  December 31,
1998, 1997 and 1996 are included elsewhere in the Form 10K and should be read in
conjunction with the full consolidated  financial  statements of the Partnership
including the Notes thereto.
<TABLE>

                                                                                     Year Ended
                                                   -------------------------------------------------------------------
                                                      12/31/98    12/31/97      12/31/96      12/31/95      12/31/94
<S>                                                   <C>       <C>           <C>           <C>           <C>       
Rental income                                         $414,717  $2,255,625    $2,615,350    $2,725,119    $2,572,947
Net income (loss)                                     $417,630  $2,009,610    ($ 167,778)    $ 309,115     $ 260,976

Net income (loss) allocated to Partners:
   Limited Partners - Per Unit- Basic and diluted:
      Aggregate 32,421 Units                           $  9.01      $59.52      ($  5.12)       $ 9.06        $ 7.65
   General Partners                                   $125,626     $79,805       ($1,678)      $15,456       $13,049

Cash distributions to Partners:
   Limited Partners:
      Weighted average per Unit                           $100     $174.00        $12.00        $15.50        $17.75
   General Partners                                        $ 0     $15,358       $20,476       $26,449       $30,288

Total assets                                          $273,377  $6,383,338   $15,644,667   $16,274,801   $16,587,271
Long term obligations                                    $   0  $3,058,800    $8,559,930    $8,695,278    $8,818,891


</TABLE>


ITEM 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
          CONDITION AND RESULTS OF OPERATIONS

This Management's  Discussion and Analysis of Financial Condition and Results of
Operations contains  forward-looking  statements  including those concerning the
General Partners' expectations regarding future financial performance and future
events.   These   forward-looking   statements  involve  significant  risks  and
uncertainties,  including  those  described  herein.  Actual  results may differ
materially from those anticipated by such forward-looking statements.

Liquidity; Capital Resources

In connection with its  capitalization,  the Partnership  admitted investors who
purchased  a total of  32,421  Units  aggregating  $16,210,500.  These  offering
proceeds,  net of  organizational  and offering  costs of  $2,431,575,  provided
$13,778,925  of net  proceeds to be used for the  purchase  of  income-producing
residential properties, including related fees and expenses, and working capital
reserves.  The Partnership expended $10,410,263 to (i) acquire its joint venture
interests in the Sin Vacas Joint Venture,  the Villa Antigua Joint Venture,  and
the Autumn Ridge Joint  Venture,  (ii) to pay  acquisition  expenses,  including
acquisition fees to one of the General Partners,  and (iii) to pay certain costs
associated with the refinancing of the Pinecliff permanent loan. The Partnership
distributed  $1,731,681 to the Limited Partners as a return of capital resulting
from  construction  cost savings with  respect to the Sin Vacas,  Pinecliff  and
Villa Antigua  projects and other excess  offering  proceeds.  The remaining net
proceeds of $1,636,981 were used to establish  initial working capital reserves.
These reserves have been used periodically to enable the Partnership to meet its
various  financial  obligations  including  contributions  to the various  Joint
Ventures that may be required.  Cumulatively through December 31, 1998, $513,611
was contributed to the Joint Ventures for this purpose.

In addition to the proceeds generated from the public offering,  the Partnership
utilized  external  sources of financing at the joint  venture level to purchase
properties.   The   Partnership   Agreement   limited  the  aggregate   mortgage
indebtedness  which could be  incurred in  connection  with the  acquisition  of
Partnership properties to 80% of the purchase price of such properties.

The  working  capital  reserves  of the  Partnership  consist  of cash  and cash
equivalents  and  short-term  investments.  Together  these amounts  provide the
Partnership with the necessary liquidity to carry on its day-to-day  operations.
At December 31, 1998, the Partnership had cash and cash  equivalents of $273,377
compared  with  $421,580 at December 31,  1997.  The  aggregate  net decrease of
$148,203  resulted  primarily  from  proceeds  from  the  sale of  Pinecliff  of
$6,248,652, plus $131,413 received from the escrow agent relating to the sale of
Villa Sin Vacas, plus a refund of deposits of $1,335, offset by distributions to
the limited  partners of  $3,242,100,  principal  payments on the mortgage notes
payable of  $3,058,800,  purchase of fixed  assets of $1,290 and the cash needed
for operations of $227,413.



<PAGE>


Results of Operations

For the year ended December 31, 1998, the  Partnership's  operating results were
comprised of its share of the income and expenses  from the  Pinecliff  (through
date of sale, May 28, 1998), as well as Partnership level interest income earned
on short-term  investments,  reduced by  administrative  expenses.  A summary of
these operating results (unaudited) appears below:
<TABLE>

                                              Pinecliff          Partnership          Total
<S>                                                <C>                  <C>            <C>     
Revenue                                            $418,001             $39,295        $457,296

Expenses:
  General and administrative                         -                  185,231         185,231
  Operations                                        181,377               -             181,377
  Depreciation and amortization                       7,888               -               7,888
  Interest                                          117,384               -             117,384
                                          ------------------     ---------------  --------------
                                                    306,649             185,231         491,880
                                          ------------------     ---------------  --------------

Net Gain (loss) from operations                     111,352           (145,936)        (34,584)
                                          ------------------     ---------------  --------------
Gain from sale of property                          452,214                             452,214
                                          ------------------     ---------------  --------------

Net income                                         $563,566          ($145,936)        $417,630
                                          ==================     ===============  ==============

</TABLE>

For the year ended December 31, 1997 the  Partnership's  operating  results were
comprised  of its share of the  income  and  expenses  from the Villas Sin Vacas
(through  date  of  sale,  November  25,  1997),  Pinecliff  and  Villa  Antigua
properties (through date of sale October 10, 1997), as well as Partnership level
interest  income earned on  short-term  investments,  reduced by  administrative
expenses. A summary of these operating results (unaudited) appears below:
<TABLE>

                                        Sin          L'Auberge           Villa                        Consolidated
                                       Vacas         Pinecliff          Antigua       Partnership         Total
<S>                                   <C>             <C>              <C>               <C>           <C>       
Total revenue                         $642,630        $952,750         $666,734          $73,177       $2,335,291

Expenses:
  General and administrative              -               -               -              227,785          227,785
  Operations                           364,115         469,256          370,078            -            1,203,449
  Depreciation and                     126,222         200,626           98,092            -              424,940
amortization
  Interest                             220,852         284,112          246,126            -              751,090
                                 --------------  --------------  ---------------  ---------------   --------------
                                       711,189         953,994          714,296          227,785        2,607,264
                                 --------------  --------------  ---------------  ---------------   --------------

Net loss from operations               (68,559)         (1,244)         (47,562)        (154,608)        (271,973)
                                 --------------  --------------  ---------------  ---------------   --------------

Gain from sale of property             974,637         -              1,306,946                         2,281,583
                                 --------------  --------------  ---------------  ---------------   --------------

Net income                            $906,078         ($1,244)      $1,259,384        ($154,608)      $2,009,610
                                 ==============  ==============  ===============  ===============   ==============


</TABLE>

<PAGE>


For the year ended December 31, 1996, the  Partnership's  operating results were
comprised  of its share of the income and  expenses  from the Sin Vacas,  Autumn
Ridge and Villa Antigua Joint  Ventures,  as well as Partnership  level interest
income earned on short term investments,  reduced by administrative  expenses. A
summary of these operating results (unaudited) appears below:
<TABLE>

                                     Sin                         Villa                    Consolidated
                                    Vacas       Pinecliff       Antigua     Partnership      Total
<S>                                <C>         <C>              <C>            <C>        <C>       
Total revenue                      $694,550    $1,022,283       $901,463       $53,445    $2,671,741

Expenses:
  General and administrative          1,686       -                  259       381,328       383,273
  Operations                        410,622       437,646        363,192        26,368     1,237,828
  Depreciation and                  126,677       181,804        122,636       -             431,117
amortization
  Interest                          223,411       286,313        277,577       -             787,301
                              -------------- ------------- -------------- ------------- -------------
                                    762,396       905,763        763,664       407,696     2,839,519
                              -------------- ------------- -------------- ============= =============
Net income (loss)                  ($67,846)     $116,520       $137,799     ($354,251)    ($167,778)
                              ============== ============= ============== ============= =============
</TABLE>

Comparison of 1998 and 1997 Operating Results:

Partnership  operations for 1998 generated net income of $417,630  compared with
net income of $2,009,610 for the corresponding  period in 1997.  Included in the
net income of  $417,630  is the gain on the sale of  Pinecliff  in the amount of
$452,214.  The loss from  operations was $34,584.  The total  operating  revenue
decreased by  $1,877,995  or 80%, due to the fact that Villa Sin Vacas and Villa
Antigua  were sold in the fourth  quarter of 1997and  Pinecliff  was sold in May
1998.  Likewise,  operating expenses decreased in total by $1,022,072 or 85% due
to the  sales  of the  properties.  General  and  administrative  expenses  have
decreased  by  $42,554  or 19%,  due  primarily  to lower  legal and  accounting
expenses.

Comparison of 1997 and 1996 Operating Results:

Partnership operations for 1997 generated net income of $2,009,610 compared with
net loss of $167,778 for the corresponding  period in 1996.  Included in the net
income  of  $2,009,610  is the gain on the sale of  Villas  Sin  Vacas and Villa
Antigua in the amount of  $2,281,583.  The loss from  operations  was  $271,973.
Total operating revenue decreased by $336,450 or 13%,  primarily due to the sale
of Villas Sin Vacas and Villa Antigua on November 25, 1997 and October 10, 1997,
respectively. Operating expenses decreased by $34,379 or 3% primarily due to the
sale of those  properties,  as such  reflecting  only a  portion  of the  year's
expenses in 1997.  This was offset by one-time costs of preparing the properties
for  disposition,  including an increase in repairs and  maintenance of $77,779.
General and administrative  expenses have decreased by $155,488 or 41%, of which
$73,775 was due to the Evans Withycombe  termination fee in 1996. A contributing
factor to the additional reduction of $81,713 was due to the re-stabilization of
costs  associated  with  Partnership  administrative,   financial  and  investor
services  functions   following  the  office  relocation  to  Colorado  Springs,
Colorado.

Projected 1999 Operating Results:

The  Partnership  has sold all of its real  estate  assets  and has  distributed
substantially  all of the net cash proceeds from the sales. A final  liquidating
distribution, which on a per unit basis, is anticipated to be nominal in amount,
will  be  made  once  all  remaining  Partnership   obligations  and  contingent
liabilities, if any, have been satisfied.



<PAGE>



Year 2000 Issues

The Partnership's  management has addressed the Year 2000 issue of its financial
reporting systems.

The  Partnership's  only  mission  critical  system is its  financial  reporting
software  which is  currently  maintained  on the Platinum  accounting  software
system, which has not been updated to handle the Year 2000 date change.  Because
the  Partnership  is in its final  liquidation  stage and is  anticipated  to be
completely  liquidated  by the  end of  1999,  the  year  2000  issue  will  not
materially  affect the  results of  operations  or  financial  condition  of the
Partnership.  However, if any financial information for the Partnership needs to
be  maintained  into the year 2000,  the  Partnership's  management  has already
purchased an accounting system, AMSI, that is Year 2000 compliant. The financial
records would be transferred to the AMSI accounting software prior to the end of
1999.

The accounting systems are run on the Novell network, which needs to be upgraded
for compliance with the Year 2000. The  Partnership's  anticipated  share of the
cost of this upgrade is $450.  The upgrade is scheduled to take place by the end
of March 1999.

Management  anticipates that all essential functions relative to maintaining the
Partnership,  if any  remain at that  time,  will be  operational  and the costs
associated  with Year 2000  compliance  will not have a  material  impact on the
Partnership.


ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     See Appendix A to this Report.

ITEM 9.   DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

     None


<PAGE>


                                    PART III


ITEM 10.   DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The Partnership is a limited partnership and, as such, has no executive officers
or directors.  The General  Partners of the Partnership are Stephen B, Boyle and
GP  L'Auberge  Communities,  L.P., a California  limited  partnership,  of which
L'Auberge   Communities   Inc.   (formerly   known  as  Berry  and  Boyle  Inc.)
("L'Auberge") is the general partner.

Individual General Partners

Stephen B.  Boyle,  age 58, is  President,  Executive  Officer  and  Director of
L'Auberge and a general  partner and co-founder of LP L'Auberge  Communities,  a
California Limited Partnership (formerly Berry and Boyle), a limited partnership
formed in 1983 to provide funds to various  affiliated  general partners of real
estate limited partnerships, one of which is GP L'Auberge Communities, L.P.

GP L'Auberge Communities, L.P.

GP L'Auberge Communities, L.P. was formed in 1983 for the purpose of acting as a
general partner in partnerships  formed to invest directly or indirectly in real
property.  L'Auberge  is the sole general  partner of GP L'Auberge  Communities,
L.P. The following sets forth certain  biographical  information with respect to
the executive  officers and  directors of L'Auberge  other than Stephen B. Boyle
who is discussed above. There are no familial relationships between or among any
officer or director and any other officer or director.

Name                                                         Position

Stephen B. Boyle              President, Executive Officer and Director
Earl C. Robertson             Executive Vice President and Chief Financial
                              Officer
Donna Popke                   Vice President and Secretary

Earl C. Robertson,  age 51, has been Executive Vice President of L'Auberge since
April 1995 and its Chief Financial  Officer since May 1996. Mr. Robertson joined
L'Auberge in April 1995 as Executive Vice President. Prior to joining L'Auberge,
Mr.  Robertson  had over 20 years  experience as a senior  development  officer,
partner and consultant in several prominent real estate  development  companies,
including  Potomac  Investment  Associates,  a developer  of planned golf course
communities  nationwide,  where he was employed  from 1989 to June 1993. He also
served as a  consultant  to Potomac  Sports  Properties  from July 1993 to April
1995. Mr.  Robertson was also a key member of the management team that developed
the nationally acclaimed Inn at the Market in Seattle.

Donna Popke,  age 39, has been Vice President of L'Auberge  since November 1995.
Ms. Popke joined L'Auberge in June 1994 as Accounting Manager.  Prior to joining
L'Auberge,  Ms. Popke was  Accounting  Manager for David R. Sellon & Company,  a
Colorado Springs land development company, from August 1989 to June 1994 and for
Intermec of the Rockies from September 1985 to July 1989.


ITEM 11. EXECUTIVE COMPENSATION

None of the General Partners or any of their officers or directors  received any
compensation  from  the  Partnership.  See  Item  13  below  with  respect  to a
description of certain transactions of the General Partners and their affiliates
with the Partnership.

ITEM 12.   SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
           MANAGEMENT

As of March 1,  1999,  no  person of  record  owned or was known by the  General
Partners  to own  beneficially  more  than 5% of the  Partnership's  outstanding
Units.  Neither of the General  Partners nor any of their directors and officers
owns Units.


ITEM 13.   CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

During the year ended , the  Partnership  paid or  accrued  remuneration  to the
General  Partners or their  affiliates  as set forth  below.  In addition to the
information provided herein, certain transactions are described in notes 7 and 8
in the Notes to Financial Statements appearing in Appendix A, which are included
in this report and are incorporated herein by reference thereto.

Net Cash from Operations distributed in 1998
  to the General Partners                                         $     -

Allocation of Income
 to the General Partners                                          $125,626

Property management fees paid to an affiliate of
the General Partners                                              $ 16,095

Reimbursements to General Partners                                $ 47,555



<PAGE>


                                     PART IV

ITEM 14.   EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
           FORM 8-K

(a)      1,2          See Page F-2
         3            See Exhibit Index contained herein

(b)      Reports on Form 8-K

         None

 (c)     See Exhibit Index contained herein

(d)      See Page F-2.



<PAGE>


                                   SIGNATURES


Pursuant to the requirements of Section 13 or 15 (d) of the Securities  Exchange
Act of 1934,  the  registrant  has duly  caused  this report to be signed on its
behalf by the undersigned, thereunto duly authorized.





           CLUSTER HOUSING PROPERTIES

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

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


                      By: __/s/ Earl C. Robertson_______________________________
                          Earl C. Robertson, Executive Vice President
                          and Chief Financial Officer

                               Date: March 1, 1999




Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following  persons on behalf of the  registrant and
in the capacities and on the dates indicated.

       Signature                             Title                     Date   



__/s/ Stephen B. Boyle________      Director, President and       March 26, 1999
  --------------------              Principal Executive 
  STEPHEN B. BOYLE                  Officer of L'Auberge
                                    Communities, Inc. 
                                    



__/s/ Earl C. Robertson_____        Executive Vice President      March 26, 1999
  ---------------------             and Principal Financial
  EARL C. ROBERTSON                 Officer of L'Auberge
                                    Communities, Inc.                          


<PAGE>


                                                                           








                                   APPENDIX A

                           CLUSTER HOUSING PROPERTIES
                       (A California Limited Partnership)
                                AND SUBSIDIARIES
                                    ---------








<PAGE>

                        CONSOLIDATED FINANCIAL STATEMENTS

             ANNUAL REPORT TO THE SECURITIES AND EXCHANGE COMMISSION

        For each of the three years in the period ended December 31, 1998








                           CLUSTER HOUSING PROPERTIES
                       (A California Limited Partnership)
                                AND SUBSIDIARIES
                                    ---------

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


Report of Independent Accountants                                            F-3


Consolidated Balance Sheets at December 31, 1998 and 1997                    F-4


Consolidated Statements of Operations for the years
ended December 31, 1998, 1997 and 1996                                       F-5


Consolidated Statements of Partners' Equity (Deficit)
for the years ended December 31, 1998, 1997 and 1996                         F-6

Consolidated Statements of Cash Flows for the years
ended December 31, 1998, 1997 and 1996                                F-7 -- F-8


Notes to Consolidated Financial Statements                           F-9 -- F-17


All  Schedules are omitted,  as they are not  applicable,  not required,  or the
information is provided in the financial statements or the notes thereto.



<PAGE>











                        Report of Independent Accountants

To the Partners of
Cluster Housing Properties
(a California Limited Partnership)

         We have audited the accompanying consolidated balance sheets of Cluster
Housing  Properties (a California  Limited  Partnership)  and subsidiaries as of
December 31, 1998 and 1997, and related  consolidated  statements of operations,
partner's  equity  (deficit)  and cash  flows for each of the three  years  then
ended. These financial statements are the responsibility of the General Partners
of the  Partnership.  Our  responsibility  is to  express  an  opinion  on these
financial statements based on our audits.

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

         As described  in Note 9 of the  financial  statements,  the General and
Limited  Partners of the  Partnership  approved a plan of liquidation on May 29,
1998 and the Partnership commenced  liquidation shortly thereafter.  As a result
the Partnership has changed its basis of accounting for the period subsequent to
May 29, 1998 from the going concern basis to a liquidation basis.

         In our opinion,  the  financial  statements  referred to above  present
fairly, in all material respects, the consolidated financial position of Cluster
Housing Properties,  (a California Limited Partnership),  and subsidiaries as of
December 31, 1997,  and the  consolidated  results of their  operations and cash
flows for each of the two years in the period then ended and for the period from
January  1,  1998  to May  29,  1998,  in  conformity  with  generally  accepted
accounting  principles;  and as of December 31, 1998 and for the period from May
30,  1998  through  December  31, 1998 in  conformity  with  generally  accepted
accounting principles applied on the basis described in the preceding paragraph.



PricewaterhouseCoopers, LLP
Denver, Colorado
February 26, 1999




<PAGE>


                           CLUSTER HOUSING PROPERTIES
                       (A California Limited Partnership)
                                AND SUBSIDIARIES


<TABLE>

                                       ASSETS

                                                      1998              1997
                                                      ----              ----
Assets held for sale (Note 9)
<S>                                                  <C>             <C>       
  Land                                               $  -            $1,242,061
                                                                                
  Buildings and improvements                            -             6,063,055
  Equipment, furnishings and fixtures                   -               642,239

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

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

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

                                                        -             5,795,148

Cash and cash equivalents                             273,377           421,580
Real estate tax escrows                                 -                24,037
Deposits and prepaid expenses                           -               133,285
Accounts receivable                                     -                 1,400
Deferred expenses, net of accumulated
  amortization of $213,035 and $205,147                 -                 7,888

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

         Total assets                                $273,377        $6,383,338
                                              ===============   ===============


                   LIABILITIES AND PARTNERS' EQUITY (DEFICIT)

Mortgage notes payable                               $  -            $3,058,800
Accounts payable                                       13,037            83,637
Accrued expenses                                       17,228           131,588
Due to affiliates (Note 8)                              9,884            16,076
Rents received in advance                               -                 1,984
Tenant security deposits                                -                33,555

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

         Total                                         40,149         3,325,640
liabilities


General Partners' deficit                              (2,221)         (127,847)
Limited Partners' equity                              235,449         3,185,545

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

        Total liabilities and partners' equity       $273,377        $6,383,338
                                              ===============   ===============



                           CLUSTER HOUSING PROPERTIES
                       (a California Limited Partnership)
                                AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                for the years ended December 31, 1998, 1997 and 1996



                                                         1998             1997            1996
                                                         ----             ----            ----
Revenue:
<S>                                                     <C>              <C>             <C>       
   Rental income                                        $414,717         $2,255,625      $2,615,350
   Interest income                                        42,579             79,666          56,391
   Gain from sale of properties                          452,214          2,281,583         -
                                                  ---------------    --------------- ---------------

Total Revenue                                            909,510          4,616,874       2,671,741

Expenses:
   Operations                                            181,377          1,203,449       1,237,828
   Interest expense                                      117,384            751,090         787,301
   Depreciation and amortization                           7,888            424,940         431,117
   General and administrative                            185,231            227,785         383,273

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

Total Expenses                                           491,880          2,607,264       2,839,519
                                                  ---------------    --------------- ---------------

Net income (loss)                                       $417,630         $2,009,610       ($167,778)
                                                  ===============    =============== ===============


Net income (loss) allocated to:
  General Partners                                      $125,626            $79,805         ($1,678)

  Basic and diluted per unit Net income (loss) allocated to
    Investor Limited Partner interest:
       32,421 units issued                                 $9.01             $59.52          ($5.12)










                           CLUSTER HOUSING PROPERTIES
                       (a California Limited Partnership)
                                AND SUBSIDIARIES

                   CONSOLIDATED STATEMENTS OF PARTNERS' EQUITY
                (DEFICIT) for the years ended December 31, 1998,
                                  1997 and 1996



                                                                                          Investor          Total
                                                                          General         Limited           Partners'
                                                                          Partners        Partners          Equity

<S>                                                                      <C>             <C>               <C>       
Balance at December 31, 1995                                             ($170,140)      $7,461,041        $7,290,901

Cash distributions                                                         (20,476)        (389,052)         (409,528)

Minority interest absorbed                                                 -                 (8,895)           (8,895)

Net loss                                                                    (1,678)        (166,100)         (167,778)
                                                                     --------------- ---------------   ---------------

Balance at December 31, 1996                                              (192,294)       6,896,994         6,704,700

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

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


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

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

Net income                                                                 125,626          292,004           417,630
                                                                     --------------- ---------------   ---------------


Balance at December 31, 1998                                               ($2,221)        $235,449          $233,228
                                                                     =============== ===============   ===============






                           CLUSTER HOUSING PROPERTIES
                       (a California Limited Partnership)
                                AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

              for the years ended December 31, 1998, 1997 and 1996


Cash flows from operating                                                   1998            1997           1996
activities:                                                                 ----            ----           ----
<S>                                                                        <C>             <C>            <C>    
  Interest received                                                        $42,579         $79,666        $80,257
  Cash received from rental income                                         379,178       2,231,306      2,607,383
  General and administrative                                              (204,332)       (243,185)      (370,245)
expenses
  Operations expense                                                      (315,824)     (1,235,265)    (1,179,822)
  Interest paid                                                           (129,014)       (772,006)      (787,816)
                                                                     --------------- ---------------  --------------

Net cash (used in) provided by operating                                  (227,413)         60,516        349,757
activities

Cash flows from investing activities:
  Proceeds from sale of properties                                       6,248,652      11,093,617          -
  Capital improvements                                                      (1,290)       (490,710)      (281,346)
  Proceeds from maturities of short-term                                         0               0
investments
  Deposit with escrow agent                                                131,413        (131,413)         -
  Cash received from short-term investments                                  -                 -        1,043,580
                                                                    ---------------   --------------  --------------

Net cash provided by investing activities                                6,378,775      10,471,494        762,234

Cash flows from financing activities:
  Distributions to partners                                             (3,242,100)     (5,656,612)      (389,052)
  Deposits                                                                   1,335           2,482         (2,125)
  Cash paid for loan refinancing                                             -             (21,025)          -
  Principal payments on mortgage notes payable                          (3,058,800)     (5,501,130)      (135,348)
                                                                    ---------------  ---------------  ---------------

Net cash used in financing                                              (6,299,565)    (11,176,285)        (526,525)
activities
                                                                    ---------------  ---------------  ---------------

Net (decrease)increase in cash and cash                                   (148,203)       (644,275)         585,466
equivalents

Cash and cash equivalents at beginning of  the                             421,580       1,065,855          480,389
period
                                                                    ---------------  ---------------  ---------------

Cash and cash equivalents at end of the period                            $273,377        $421,580       $1,065,855
                                                                    ===============  ===============  ===============

Non cash financing activities:
   Accrual of distributions to                                                  $0              $0          $20,476
partners


                           CLUSTER HOUSING PROPERTIES
                       (a California Limited Partnership)
                                AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

 for the years ended December 31, 1998, 1997 and 1996


Reconciliation  of net income (loss) to net cash (used in) provided by operating
activities:



                                                                          1998            1997              1996
                                                                          ----            ----              ----
<S>                                                                     <C>           <C>                <C>       
Net income (loss)                                                       $417,630      $2,009,610         ($167,778)

Adjustments to reconcile net income (loss) to net cash (used in)
  provided by operating activities:
  Depreciation and amortization                                            7,888         424,940           431,117
  Gain from sale of property                                            (452,214)     (2,281,583)              -
Change in assets and liabilities net of effects
of investing and financing activities:
    Decrease in real estate tax escrows                                   24,037          17,595             2,423
    Decrease prepaid expenses                                                537           1,946               -
    Decrease in accounts receivable                                        1,400           1,205            21,951
    (Decrease) increase in accounts payable and accrued expenses        (184,960)        (95,979)           84,185
    (Decrease) increase in due to affiliates                              (6,192)          7,101           (14,198)
    Decrease in rent received in advance                                  (1,984)         (2,554)           (5,957)
    Decrease in tenant security deposits                                 (33,555)        (21,765)           (1,986)
                                                                     ------------    ------------     -------------

Net cash (used in) provided by operating activities                    ($227,413)        $60,516          $349,757
activities
                                                                     ============    ============     =============
</TABLE>

1.  Organization of Partnership:

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

A  total  of  2,000  individual   Limited  Partners  owning  32,421  units  have
contributed $16,210,500 of capital to the Partnership. At December 31, 1998, the
total  number of  Limited  Partners  was 1,902.  Except  under  certain  limited
circumstances,  as defined in the Partnerhip Agreement, the General Partners are
not required to make any additional capital contributions.  The General Partners
or their affiliates will receive various fees for services and reimbursement for
various organizational and selling costs incurred on behalf of the Partnership.

As of December 31,  1998,  the  Partnership  has sold  substantially  all of the
assets and is in its final  liquidation.  Once all Partnership  obligations have
been satisfied,  the remaining  Partnership funds, if any, are anticipated to be
distributed  to the Limited  Partners.  Such funds,  if any,  are expected to be
modest in amount.  It is  anticipated  that the  Partnership  will be liquidated
during 1999.

2.  Significant Accounting Policies:

         A.  Basis of Presentation

         The  consolidated  financial  statements  include  the  accounts of the
         Partnership and its subsidiaries:  Sin Vacas Joint Venture (Sin Vacas),
         Pinecliff  (Pinecliff),  formerly Autumn Ridge Joint Venture, and Villa
         Antigua Joint Venture (Villa Antigua).  All  intercompany  accounts and
         transactions  have been  eliminated in  consolidation.  The Partnership
         follows the accrual basis of accounting.  Refer to Note 5 regarding the
         termination  of the Joint  Ventures  and the sale of Sin  Vacas,  Villa
         Antigua and Pinecliff.

         The Partnership follows the accrual basis of accounting.

         The  Partnership  considers  itself  to have been  engaged  in only one
industry segment, real estate.

         B.  Cash and Cash Equivalents

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

         C. Significant Risks and Uncertainties

         The  preparation of financial  statements in conformity  with generally
         accepted  accounting  principles  requires management to make estimates
         and  assumptions  that  affect  the  reported  amounts  of  assets  and
         liabilities and disclosure of contingent  assets and liabilities at the
         date of the financial statements and the
2.  Significant Accounting Policies, continued:

         reported amounts of revenues and expenses during the reporting  period.
Actual results could differ from those estimates.

         D.  Depreciation

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

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

         As  discussed  further  in  Note  9,  as  of  December  31,  1997,  the
         Partnership  recorded  its  property  as  Assets  Held  for Sale on the
         consolidated  balance  sheets.   Accordingly  the  Partnership  stopped
         depreciating these assets effective January 1, 1998.

         E.  Deferred Expenses

         Costs of obtaining or extending  mortgages on the  properties are being
         amortized over the mortgage term using the straight-line  method, which
         approximates the effective interest method.

         F.  Income Taxes

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

         G. Rental Income

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

         H. Long-Lived Assets

         The Partnership utilizes the provisions of SFAS No. 121, Accounting for
         the  Impairment of Long -Lived Assets and for  Long-Lived  Assets to be
         Disposed Of, to review for impairment.  Recoverability  of assets to be
         held and used is measured by a comparison of the carrying  amount of an
         asset to future net cash flows  expected to be  generated by the asset.
         If such assets are  considered  to be impaired,  the  impairment  to be
         recognized  is measured by the amount by which the  carrying  amount of
         the assets exceeds the fair value of the assets.  As further  discussed
         in Note 9, assets to be  disposed  of are  reported at the lower of the
         carrying amount or fair value less costs to sell.

         I. Reclassification

         Certain items in the financial  statements for the years ended December
         31,  1996  and 1997  have  been  reclassified  to  conform  to the 1998
         presentation.


<PAGE>

<TABLE>


3. Assets Held for Sale:


The changes in total assets held for sale for the years ended         The change in accumulated depreciation for the years ended
December 31, 1998, 1997, and 1996 are as follows:                     December 31, 1998, 1997, and 1996 are as follows:


                                  1998        1997          1996                                     1998         1997        1996
                                 -----       -----         -----                                    -----        -----       -----
<S>                          <C>         <C>          <C>                                         <C>         <C>         <C>       
Balance, beginning of year   $7,947,355  $19,321,621  $19,040,329     Balance, beginning of year  $2,152,207  $4,810,314  $4,418,093

Additions during the period:
   Improvements                  $1,290     $490,710     $281,292     Depreciation for the period         $0    $394,834    $392,221

Deductions during the period:
   Sale of Pinecliff        ($7,948,645)        -           -         Disposition of Pinecliff   ($2,152,207)       -           -
   Sale of Sin Vacas              -       ($5,593,045)      -         Disposition of Sin Vacas         -      ($1,615,565)
   Sale of Villa Antigua          -       ($6,271,931)      -         Disposition of Villa             -      ($1,437,376)      -

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

Balance at end of year               $0    $7,947,355  $19,321,621    Balance at end of year              $0   $2,152,207    810,314
                            =======================================                           ======================================

</TABLE>

<PAGE>


4.  Cash and Cash Equivalents:

Cash and cash  equivalents  at  December  31,  1998  and 1997  consisted  of the
following:


                                                           1998          1997
                                                           ----          ----
                  Cash on Hand hand                     $ 273,377      $ 132,330
                  Money market accounts                                  289,250
                                                       -----------    ----------

                                                         $273,377       $421,580

5.  Joint Venture and Property Acquisitions:

The  Partnership  had invested in three  properties  located in  Scottsdale  and
Tucson, Arizona and Colorado Springs,  Colorado. The Partnership held a majority
interest  in  these  properties  and  controlled  the  operations  of the  joint
ventures.

Sin Vacas

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

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

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

JANUARY 1, 1996 THROUGH MAY 13, 1996

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

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

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

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





5.  Joint Venture and Property Acquisitions, continued:

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

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

Villa Antigua

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

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

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

JANUARY 1, 1996 THROUGH MAY 13, 1996

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

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

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

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

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

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


<PAGE>



5.       Joint Venture and Property Acquisitions, continued:


Sin Vacas and Villa Antigua

MAY 14, 1996 THROUGH NOVEMBER 25, 1997

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

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

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

Pinecliff

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

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

<PAGE>



5.       Joint Venture and Property Acquisitions, continued:

The Partnership made initial cash payments in the form of capital  contributions
totaling $3,819,397 and funded $546,576 of property acquisition costs which were
treated as a capital  contribution  to the Autumn  Ridge  Joint  Venture.  Since
completion of  construction,  the Partnership has made additional  contributions
totaling  $318,811.  At December 31, 1998, the total capital  contributions  and
acquisition costs incurred were $4,192,309 and $497,475, respectively.

JANUARY 1, 1996 THROUGH JULY 2, 1996:

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

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

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

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

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

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

JULY 3, 1996 THROUGH MAY 28, 1998

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

On May 28, 1998, the Partnership  sold  Pinecliff,  its final real estate asset.
Pinecliff was sold to G&I Pinecliff LLC, a Delaware  limited  liability  company
unaffiliated  with the  Partnership.  The net  sales  price  for  Pinecliff  was
$6,248,652, subject to certain customary adjustments,  net of a credit to the
purchaser of $360,000 for capital improvements.  The Partnership repaid mortgage
financing in the amount of $3,041,860 at closing utilizing a portion of proceeds
from the sale. The Partnership recorded a gain on sale of $452,214 during 1998.

6.  Mortgage Notes Payable:

Pinecliff
The original maturity date for the note was July 15, 1997. On July 10, 1997, the
lender  extended the terms of the mortgage note for a period of one year.  Under
the  modification  agreement,  the monthly  principal  and  interest  payment of
$27,976 and the original interest rate of 9.125% remained  unchanged.  The terms
of the  agreement  provide for a prepayment  penalty of 0.5% of the  outstanding
loan  amount in the event the note is paid  prior to 60 days  before it  becomes
due. As discussed in Note 5, the Partnership  sold Pinecliff and the outstanding
mortgage debt of $3,041,860 was paid.  There was no prepayment  penalty assessed
since the debt was paid within 60 days of maturity.

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

                                                                   1997

         Pinecliff                                               $3,058,800

Interest  included in accrued  expenses in the  Consolidated  Balance  Sheets at
December 31, 1997 consisted of the following:

                                                                   1997

         Pinecliff                                               $ 11,630


7.  Partners' Equity:

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

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

The net  proceeds on the sale of  Pinecliff  of  $3,145,390  were  allocated  as
follows.  The Limited Partners received 100% of the cash distribution from sale.
The total gain on sale of Pinecliff of $452,214  was  allocated as follows.  The
General  Partner  received a gain on sale allocation of $125,972 and the Limited
Partners   received   a   gain   on   sale   allocation   of   $326,242.   These
distributions/allocations  were in accordance  with the terms of the Partnership
Agreement.


8.  Related-Party Transactions:

L'Auberge Communities, Inc. is a General Partner of L'Auberge Communities, which
owns a 99% interest in GP L'Auberge Communities,  L.P. (formerly Berry and Boyle
Management).  Due to  affiliates  at  December  31, 1998 and 1997  consisted  of
reimbursable costs payable to L'Auberge  Communities,  Inc., an affiliate of the
General Partners, in the amounts of $9,884 and $16,076, respectively.

For the years ended December 31, 1998, 1997 and 1996, general and administrative
expenses  included  $47,555,  $64,209  and  $82,881,   respectively,  of  salary
reimbursements  paid to the  General  Partners  for certain  administrative  and
accounting personnel who perform services for the Partnership.

The officers and principal  shareholders  of EWI, the developer of the Villas at
Sin Vacas and Villa Antigua  properties and an affiliate of the  co-venturers of
those joint ventures, together hold a two and one half percent cumulative profit
or partnership voting interest in LP L'Auberge Communities, a California Limited
Partnership, formerly Berry and Boyle, which is the principal limited partner of
GP L'Auberge Communities, L.P.

During the years ended December 31, 1996, EWI received property  management fees
of $32,475.  These fees were 5% of rental  revenue.  In addition,  for the years
ended  December  31,  1998,  1997  and  1996,  $16,095,   $87,724  and  $64,954,
respectively,  of property  management  fees were paid or accrued to Residential
Services - L'Auberge,  an affiliate of the General Partners.  These fees were 4%
of rental revenue.

Villa Antigua  reimbursed  $35,885 for its proportionate  share of the 1996 real
estate  taxes to Villa  Antigua  Phase II,  which is an affiliate of the General
Partners.  For the year ended December 31, 1997,  real estate taxes were settled
as part of the closing of the sale.

9.  Assets held for Sale

During the fourth  quarter of 1997,  the  General  Partners  of the  Partnership
committed to a plan to dispose of Pinecliff in Colorado  Springs,  Colorado.  On
January  15,  1998,  the   Partnership   entered  into  a  Sale  Agreement  (the
"Agreement") to sell Pinecliff to an unaffiliated third party. The selling price
for  Pinecliff  was  approximately  $6,700,000.  The  Agreement  was  subject to
completion of customary due diligence to the satisfaction of the purchaser,  and
the purchaser obtaining a financing commitment on commercially  reasonable terms
and conditions.  The Partnership consummated this sale in May 1998. The sale was
approved by the Limited Partners.

As it was  the  intent  of the  General  Partners  to  pursue  the  sale of this
property, the Partnership had recorded the assets at the lower of carrying value
or net  realizable  value and included  these amounts as Assets Held for Sale on
the  Consolidated  Balance Sheets at December 31, 1997. In accordance  with SFAS
121, the Partnership  stopped  depreciating  these assets  effective  January 1,
1998.  The  proceeds  from sale of Pinecliff  were  allocated to the Partners in
accordance with the terms of the Partnership Agreement.

Under the  provisions  of the  Partnership  agreement,  the  dissolution  of the
Partnership  requires  a  consent  of a  majority  in  interest  of the  limited
partners.  The consent of a majority in interest of the limited  partners to the
dissolution  was  obtained on May 29, 1998.  As a result,  the  Partnership  has
changed its basis of accounting, for the period subsequent to May 29, 1998, from
the going concern basis to the liquidation basis. Under the liquidation basis of
accounting,  net assets and equity are reported at their net  realizable  value,
which  may  result  in a  net  write-up  or  write-down.  The  adoption  of  the
liquidation  basis of  accounting  had no effect on the  financial  position  or
results of  operations  of the  Partnership.  As of December 31,  1998,  the net
assets available for distribution to the partners are approximately  $233,230 or
$7.19 per unit. In the event future obligations are different than expected as a
result  of  factors  unknown  at  this  time,  the  net  assets   available  for
distribution may change. The Partnership will likely be liquidated in 1999.


<PAGE>



                                  EXHIBIT INDEX
Exhibit
  No.                                                                          
(4)(a)(1)  Amended and Restated Certificate and Agreement of Limited Partnership
           (included  in  Partnership's   Registration  Statement  No.  2-86262,
           declared effective on March 22, 1984 (the  "Registration  Statement")
           and incorporated herein by reference).

(4)(a)(2)  Seventeenth   Amendment  to  Amended  and  Restated  Certificate  and
           Agreement of Limited  Partnership  dated May 31, 1990 (included as an
           exhibit  to the  Partnership's  Form 10-K for the  fiscal  year ended
           December 31, 1990 and incorporated herein by reference).

(4)(b)     Subscription  Agreement  (included as an Exhibit in the  Registration
           Statement and incorporated herein by reference).

(10)(a)    Property management  agreement between Autumn Ridge Joint Venture and
           Berry and Boyle Residential  Services.(included  as an exhibit to the
           Partnership's  Form 10-K for the fiscal year ended  December 31, 1990
           and incorporated herein by reference).

(10)(b)    Property  management  agreement  regarding  Sin Vacas  between
           Cluster Housing Properties and L'Auberge Communities Inc. dated
           May 15, 1996.

(10)(c)    Property management agreement regarding Villa Antigua between Cluster
           Housing Properties and L'Auberge Communities Inc. dated November 30,
           1996.

(10)(d)    Documents  pertaining to the permanent loan  refinancing  for the Sin
           Vacas Joint Venture (included as an exhibit to the Partnership's Form
           10-K for the fiscal year ended  December  31,  1992 and  incorporated
           herein by reference).

(10)(e)    Documents pertaining to the permanent loan refinancing for the Autumn
           Ridge Joint Venture (included as an exhibit to the Partnership's Form
           10-K for the fiscal year ended  December  31,  1992 and  incorporated
           herein by reference).

(10)(f)    Documents  pertaining to the permanent loan refinancing for the Villa
           Antigua  Joint Venture  (included as an exhibit to the  Partnership's
           Form  10-K  for  the  fiscal  year  ended   December   31,  1992  and
           incorporated herein by reference).

(10)(g)    First  Amendment to Joint  Venture  Agreement of L'Auberge  Pinecliff
           Joint Venture and Related Assignment of Joint Venture Interest 
           (included as an exhibit to the Partnership's Form 10-K for the fiscal
           year ended December 31, 1996 and incorporated herein by reference).

(10)(h)    Agreement regarding Villa Sin Vacas Joint Venture (included as an
           exhibit to the Partnership's Form 10-K for the fiscal year ended 
           December 31, 1997 and incorporated herein by reference).

(10)(i)    Agreement regarding Villa Antigua Joint Venture (included as an
           exhibit to the Partnership's Form 10-K for the fiscal year ended 
           December 31, 1997 and incorporated herein by reference).

(10)(j)    Purchase and Sale Agreement and Escrow  Instructions  between Cluster
           Housing  Properties  and DRA  Advisors,  Inc.  related to the sale of
           Pinecliff dated January 15, 1998(included as an exhibit to the 
           Partnership's Form 10-K for the fiscal year ended December 31, 1997
           and incorporated herein by reference).


(27)     Financial Data Schedule