FORM 10-Q

               SECURITIES AND EXCHANGE COMMISSION
                     WASHINGTON, D.C.  20549


 X   Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
 Act of 1934

For the quarterly period ended June 30, 1998 or

     Transition report pursuant to Section 13 or 15(d) of the Securities 
Exchange Act of 1934

For the transition period from               to              

Commission File Number:  0-20737

             AMERICA FIRST APARTMENT INVESTORS, L.P.
     (Exact name of registrant as specified in its charter)

Delaware                                                47-0797793            
(State or other jurisdiction                            (IRS Employer 
of incorporation or organization)                       Identification No.)


Suite 400, 1004 Farnam Street, Omaha, Nebraska          68102       
(Address of principal executive offices)                (Zip Code)


(402) 444-1630                              
(Registrant's telephone number, including area code)


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

                YES   X                  NO     



































<PAGE>                               - i -
Part I.  Financial Information
  Item 1.  Financial Statements
AMERICA FIRST APARTMENT INVESTORS, L.P.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
                                                                                              June 30, 1998       Dec. 31, 1997
                                                                                             --------------      --------------
<S>                                                                                          <C>                 <C>
Assets
 Cash and temporary cash investments, at cost which
  approximates market value (Note 4 and Note 7)                                              $  40,364,313       $   7,879,934
 Investment in real estate, net of accumulated depreciation (Note 5)                            63,035,490          64,267,471
 Investment in tax-exempt mortgage bonds, at estimated fair value (Note 6)                            -             13,006,526
 Interest receivable                                                                               113,349             108,623
 Other assets                                                                                    2,097,842           1,860,968
                                                                                             --------------      --------------
                                                                                             $ 105,610,994       $  87,123,522 
                                                                                             ==============      ==============
Liabilities and Partners' Capital
 Liabilities                                                                                                                   
  Accounts payable (Note 9)                                                                  $   2,048,234       $   1,861,162
  Bonds payable (Note 7)                                                                        39,951,583          27,035,000 
  Due to Jefferson Place L.P.                                                                    2,400,000           2,400,000
  Distribution payable (Note 3)                                                                    329,051             329,051 
                                                                                             --------------      --------------
                                                                                                44,728,868          31,625,213
                                                                                             --------------      --------------
 Partners' Capital
  General Partner                                                                                   15,676               7,037
  Beneficial Unit Certificate Holders
  ($11.68 per BUC in 1998 and $10.65 in 1997)                                                   60,866,450          55,491,272
                                                                                             --------------      --------------
                                                                                                60,882,126          55,498,309 
                                                                                             --------------      --------------
                                                                                             $ 105,610,994       $  87,123,522 
                                                                                             ==============      ==============

The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>



































<PAGE>                               - 1 -
AMERICA FIRST APARTMENT INVESTORS, L.P.
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
                                                           For the             For the         For the Six         For the Six
                                                     Quarter Ended       Quarter Ended        Months Ended        Months Ended
                                                     June 30, 1998       June 30, 1997       June 30, 1998       June 30, 1997
                                                    ---------------     ---------------     ---------------     ---------------
<S>                                                 <C>                 <C>                 <C>                 <C>
Income
 Rental income                                      $    3,257,012     $     2,331,340      $    6,346,936      $    4,024,158
 Mortgage bond investment income                           561,637             421,444             839,201           1,053,948
 Contingent interest income                                   -                290,520                -                290,520
 Interest income on temporary cash investments             313,555              22,878             387,905              28,866
                                                    ---------------     ---------------     ---------------     ---------------
                                                         4,132,204           3,066,182           7,574,042           5,397,492
                                                    ---------------     ---------------     ---------------     ---------------
Expenses
 Real estate operating expenses                          1,515,315           1,139,355           3,000,547           1,805,379
 Depreciation                                              614,273             477,322           1,228,547             810,211
 Interest expense                                          611,137             381,864           1,041,889             547,121
 General and administrative expenses (Note 9)              355,938             269,078             693,411             539,163
                                                    ---------------     ---------------     ---------------     ---------------
                                                         3,096,663           2,267,619           5,964,394           3,701,874
                                                    ---------------     ---------------     ---------------     ---------------
Net income                                          $    1,035,541      $      798,563      $    1,609,648      $    1,695,618
                                                    ===============     ===============     ===============     ===============
Net income allocated to:
 General Partner                                    $       16,498      $        9,854      $       28,382      $       22,153
 BUC Holders                                             1,019,043             788,709           1,581,266           1,673,465
                                                    ---------------     ---------------     ---------------     ---------------
                                                    $    1,035,541      $      798,563      $    1,609,648      $    1,695,618
                                                    ===============     ===============     ===============     ===============
Net income, basic and diluted, per BUC              $          .19      $          .15      $          .30      $          .32
                                                    ===============     ===============     ===============     ===============
Weighted average number of BUCs outstanding              5,212,167           5,212,167           5,212,167           5,212,167
                                                    ===============     ===============     ===============     ===============
</TABLE>

AMERICA FIRST APARTMENT INVESTORS, L.P.
CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL
FOR THE SIX MONTHS ENDED JUNE 30, 1998
(UNAUDITED)
<TABLE>
<CAPTION>
                                                                                  	Beneficial Unit
                                                                                 Certificate Holders
                                                           General           
                                                           Partner           # of BUCs              Amount               Total
                                                    ---------------     ---------------     ---------------     ---------------
<S>                                                 <C>                 <C>                 <C>                 <C>
Partners' Capital (excluding net unrealized
 holding losses):
Balance at December 31, 1997                                 7,037           5,212,167          61,239,746          61,246,783
Net income                                                  28,382                -              1,581,266           1,609,648
Cash distributions paid or accrued (Note 3)
 Income                                                    (19,743)               -               (726,015)           (745,758)
 Return of capital                                            -                   -             (1,228,547)         (1,228,547)
                                                    ---------------     ---------------     ---------------     ---------------
                                                            15,676           5,212,167          60,866,450          60,882,126
                                                    ---------------     ---------------     ---------------     ---------------
Net unrealized holding losses:
Balance at December 31, 1997                                  -                   -             (5,748,474)         (5,748,474)
Net change (Note 6)                                           -                   -              5,748,474           5,748,474
                                                    ---------------     ---------------     ---------------     ---------------
                                                              -                   -                   -                   -
                                                    ---------------     ---------------     ---------------     ---------------
Balance at June 30, 1998                            $       15,676           5,212,167      $   60,866,450      $   60,882,126
                                                    ===============     ===============     ===============     ===============

The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>



<PAGE>                               - 2 -
AMERICA FIRST APARTMENT INVESTORS, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
                                                                                               For the Six         For the Six
                                                                                              Months Ended        Months Ended
                                                                                             June 30, 1998       June 30, 1997
                                                                                            ---------------     ---------------
<S>                                                                                         <C>                 <C>   
Cash flows from operating activities                                                                                           
 Net income                                                                                 $    1,609,648      $    1,695,618
  Adjustments to reconcile net income to net cash 
   provided by operating activities
    Depreciation                                                                                 1,228,547             810,211 
    Amortization                                                                                    73,098              81,953
    (Increase) decrease in interest receivable                                                      (4,726)             47,075
    (Increase) decrease in other assets                                                            (57,344)            225,253
    Increase in accounts payable                                                                   187,072             174,721
                                                                                            ---------------     ---------------
 Net cash provided by operating activities                                                       3,036,295           3,034,831 
                                                                                            ---------------     ---------------
Cash flows from investing activities
 Real estate capital improvements                                                                   (1,653)           (166,835) 
 Acquisition of real estate                                                                          5,087         (12,431,193)
 Proceeds from disposition of mortgage bond                                                     18,755,000                -
                                                                                            ---------------     ---------------
 Net cash provided by (used in) investing activities                                            18,758,434         (12,598,028)
                                                                                            ---------------     ---------------
Cash flows from financing activities
 Distributions paid                                                                             (1,974,305)         (1,974,308)
 Bond issuance costs paid                                                                         (252,628)           (298,149)
 Net borrowings on line of credit                                                                     -              8,573,671
 Proceeds from issuance of bonds payable                                                        13,090,000           3,450,000
 Principal payments on bonds payable                                                              (173,417)            (80,000)
                                                                                            ---------------     ---------------
 Net cash provided by financing activities                                                      10,689,650           9,671,214
                                                                                            ---------------     ---------------
Net increase in cash and temporary cash investments                                             32,484,379             108,017
Cash and temporary cash investments at beginning of period                                       7,879,934           2,021,860
                                                                                            ---------------     ---------------
Cash and temporary cash investments at end of period                                        $   40,364,313      $    2,129,877
                                                                                            ===============     ===============
Supplemental disclosure of cash flow information:
 Cash paid during the period for interest                                                   $      701,229      $      329,335
                                                                                            ===============     ===============
Supplemental schedule of non-cash investing activities
 Settlement of mortgage bond for real estate                                                $         -         $    8,760,000
                                                                                            ===============     ===============

The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>
























<PAGE>                               - 3 -
AMERICA FIRST APARTMENT INVESTORS, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1998
(UNAUDITED)

1. Organization

America First Apartment Investors, L.P. (the Partnership) was formed on March 
7, 1996, under the Delaware Revised Uniform Limited Partnership Act for the 
purpose of acquiring, holding, operating, selling or otherwise dealing with 
multifamily residential properties and other types of commercial real estate 
and interests therein.  The Partnership commenced operations on August 20, 
1996, when it merged with America First Tax Exempt Mortgage Fund 2 Limited 
Partnership (the Prior Partnership).  Under the terms of the merger agreement, 
the Partnership was the surviving partnership and effectively took over the 
operations of the Prior Partnership.  Unit holders of the Prior Partnership 
received one Beneficial Unit Certificate (BUC) of the Partnership for each BUC 
they held in the Prior Partnership as of the record date.  The Prior 
Partnership was terminated under the provisions of the Prior Partnership's 
Partnership Agreement.  The Partnership will terminate on December 31, 2016, 
unless terminated earlier under the provisions of its Partnership Agreement.  
The General Partner of the Partnership is America First Capital Associates 
Limited Partnership Four (AFCA 4).

2. Summary of Significant Accounting Policies

 A) Financial Statement Presentation
    The consolidated financial statements include the accounts of the 
    Partnership and its subsidiaries.  All significant intercompany 
    transactions and accounts have been eliminated in consolidation.

    The consolidated financial statements of the Partnership are prepared 
    without audit on the accrual basis of accounting in accordance with 
    generally accepted accounting principles.  The consolidated financial 
    statements should be read in conjunction with the consolidated and 
    combined financial statements and notes thereto included in the 
    Partnership's Annual Report on Form 10-K for the year ended December 31, 
    1997.  In the opinion of management, all normal and recurring adjustments 
    necessary to present fairly the financial position at June 30, 1998, 
    and results of operations for all periods presented have been made.

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

 B) Investment in Real Estate
    The Partnership's investment in real estate consists of property acquired 
    through foreclosure or deed in lieu of foreclosure and other real estate 
    acquired.  Each real estate property acquired is recorded at the lower of 
    cost or estimated net realizable value.  The carrying value of each 
    property is periodically reviewed and adjusted when there are significant 
    declines in the estimated net realizable value (see Note 2D). 

    Depreciation of real estate is based on the estimated useful life of the 
    property (27-1/2 years on multifamily residential apartments and 31-1/2 
    years on The Exchange at Palm Bay) using the straight-line method.  
    Depreciation of real estate improvements on The Exchange at Palm Bay is 
    based on the term of the related tenant lease using the straight-line 
    method.

 C) Investment in Tax-Exempt Mortgage Bonds
    Investment securities are classified as held-to-maturity, available-
    for-sale, or trading.  Investments classified as available-for-sale are 
    reported at fair value with any unrealized gains or losses excluded from 
    earnings and reflected as a separate component of partners' capital.  
    Subsequent increases and decreases in the net unrealized gain/loss on the 
    available-for-sale securities are reflected as adjustments to the carrying 
    value of the portfolio and adjustments to the component of partners' 
    capital.  The Partnership does not have investment securities classified 
    as held-to-maturity or trading.  


<PAGE>                               - 4 -
AMERICA FIRST APARTMENT INVESTORS, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1998
(UNAUDITED)

    Accrual of mortgage bond investment income is excluded from income when, 
    in the opinion of management, collection of related interest is doubtful. 
    This interest is recognized as income when it is received.

 D) Fair Value of Real Estate
    The fair value of the real estate is based on management's best estimate 
    of the net realizable value of the properties which may differ from the 
    ultimate values realized from these properties.  The net realizable value 
    of the properties is determined based on the discounted estimated future 
    cash flows from the properties, including estimated sales proceeds.  The 
    calculation of discounted estimated future cash flows includes certain 
    variables such as the assumed inflation rates for rents and expenses, 
    capitalization rates and discount rates.  These variables are supplied to 
    the Partnership by an independent real estate appraisal firm based upon 
    local market conditions for each property.  In certain cases, additional 
    factors such as the replacement value of the property or comparable sales 
    of similar properties are also taken into consideration.

 E) Income Taxes
    No provision has been made for income taxes since Beneficial Unit 
    Certificate (BUC) Holders are required to report their share of the     
    Partnership's taxable income for federal and state income tax purposes.

 F) Temporary Cash Investments
    Temporary cash investments are invested in short-term debt securities 
    purchased with an original maturity of three months or less.

 G) Net Income per BUC
    Net income per BUC has been calculated based on the weighted average 
    number of BUCs outstanding during each period presented.

 H) Comprehensive Income           
    In the first quarter of 1998, the Partnership adopted Statement of 
    Financial Accounting Standards No. 130, "Reporting Comprehensive Income" 
    (SFAS 130).  SFAS 130 requires the display and reporting of comprehensive 
    income, which includes all changes in Partners' Capital with the exception
    of additional investments by partners or distributions to partners.  
    Comprehensive income for the Partnership includes net income and the 
    change in net unrealized holding losses on investments charged or credited 
    to Partners' Capital.  Comprehensive income for the quarter and six months 
    ended June 30, 1998, compared to the same periods in 1997 was as follows: 

<TABLE>
<CAPTION>
                                                           For the             For the         For the Six         For the Six
																																																					Quarter Ended       Quarter Ended        Months Ended        Months Ended
                                                     June 30, 1998       June 30, 1997       June 30, 1998       June 30, 1997
                                                    ---------------     ---------------     ---------------     ---------------
<S>                                                 <C>                 <C>                 <C>                 <C>
Net income                                          $    1,035,541      $      798,563      $    1,609,648      $    1,695,618 
Change in net unrealized holding gains														     5,748,474                -              5,748,474                -
                                                    ---------------     ---------------     ---------------     ---------------
Comprehensive income                                $    6,784,015      $      798,563      $    7,358,122      $    1,695,618
																																																				===============     ===============     ===============     ===============
</TABLE>

3. Partnership Income, Expenses and Cash Distributions

The Partnership Agreement contains provisions for the distribution of Net 
Operating Income, Net Sale Proceeds and Liquidation Proceeds and for the 
allocation of income and expenses for tax purposes among AFCA 4 and BUC 
Holders.

Cash distributions included in the financial statements represent the actual 
cash distributions made during each period and the cash distributions accrued 
at the end of each period.





<PAGE>                               - 5 -   
AMERICA FIRST APARTMENT INVESTORS, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1998
(UNAUDITED)

4. Partnership Reserve Account

The Partnership maintains a reserve account which totaled $32,293,964 at June 
30, 1998. The reserve account was established to maintain working capital for 
the Partnership and is available to supplement distributions to investors or 
for any other contingencies related to the ownership of real estate acquired 
and the operation of the Partnership, including the acquisition of additional 
properties.  

5. Investment in Real Estate

The Partnership's investment in real estate is comprised of the following:
<TABLE>
<CAPTION>
                                                                                                 Building
                                                               Number                                 and             Carrying
  Property Name                        Location               of Units   	         Land      Improvements               Amount
  ---------------------------------    --------------------   --------     -------------   ---------------    -----------------
  <S>                                  <C>                    <C>          <C>             <C>                <C>
  Covey at Fox Valley(1)               Aurora, IL                216       $  1,320,000    $   10,028,338     $     11,348,338
  The Exchange at Palm Bay             Palm Bay, FL           72,002(2)       1,296,002         3,991,602            5,287,604
  The Park at Fifty Eight(1)   	       Chattanooga, TN           196            231,113         4,122,226            4,353,339
  Shelby Heights(1)                    Bristol, TN               100            175,000         2,952,847            3,127,847
  Coral Point(1)                       Mesa, AZ                  336          2,240,000         8,960,000           11,200,000 
  Park at Countryside(1)               Port Orange, FL           120            647,000         2,616,648            3,263,648
  The Retreat(3)                       Atlanta, GA               226          1,800,000         7,315,697            9,115,697
  Jackson Park Place(1)                Fresno, CA                296          1,400,000        10,709,534           12,109,534
  Park Trace Apartments(1)             Norcross, GA              260          2,246,000        11,789,810           14,035,810
                                                                                                              -----------------
                                                                                                                    73,841,817
  Less accumulated depreciation                                                                                    (10,806,327)
                                                                                                              -----------------
  Balance at June 30, 1998                                                                                    $     63,035,490
                                                                                                              =================
</TABLE>
(1) Property is encumbered as described in Note 7.
(2) Represents square feet.
(3) Property serves as collateral for $12,200,000 of multifamily revenue 
    refunding bonds issued on Jefferson Place.  The Partnership is an 
    affiliate of the general partner of the partnership which owns Jefferson 
    Place.

6. Investment in Tax-Exempt Mortgage Bonds

On May 1, 1998, the Partnership sold its tax-exempt mortgage bond which was 
collateralized by Avalon Ridge Apartments in Renton, Washington.  The 
tax-exempt mortgage bond was sold for $18,755,000 plus accrued interest.  The 
net unrealized holding loss of $5,748,474 on such bond was eliminated thus 
Partners' Capital was increased by the same amount.






















<PAGE>                               - 6 -
AMERICA FIRST APARTMENT INVESTORS, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1998
(UNAUDITED)

7.  Bonds Payable

Bonds payable were originated by the Partnership through the issuance of 
tax-exempt refunding bonds.  Bonds payable at June 30, 1998, consists of 
the following:

<TABLE>
<CAPTION>

                        Effective Final     
                        Interest  Maturity                                      Annual            	         	Carrying
Collateral              Rate      Date      Payment Schedule                    Payments    		      				       Amount	
----------------------- --------- --------  ----------------------------------- ---------------------   -------------
<S>                     <C>       <C>       <C>                                 <C>                     <C>
The Park at Fifty Eight   6.65%   3/1/2021  semiannual payments of              range from $224,000     $  2,620,000
 					    																																		principal and/or interest           to $228,000
                                            are due each March 1 and September 1

Shelby Heights and	       6.10%   3/1/2022  semiannual payments of              range from $266,000        3,380,000      
 Park at Countryside                        principal and/or interest           to $276,000
                                            are due each March 1 and September 1																								

Covey at Fox Valley       5.30%  11/1/2007  semiannual payments of              $586,000 in 1998,         12,410,000
 and Park Trace Apartments                  interest are due each May 1         $658,000 thereafter
                                            and November 1

Jackson Park Place        5.80%  12/1/2027  monthly payment of                  $611,901                   8,451,583
                                            principal and interest                                    
                                            are due the 1st of each month

Coral Point(1)            4.96%   3/1/2008  semiannual payments of              $325,016 in 1998, 
                                            interest are due each               $650,033 thereafter
                                            March 1 and September 1                                       13,090,000
                                                                                                        -------------
Balance at June 30, 1998				  																																														 			                        $ 39,951,583
																																																																																																								=============
</TABLE>
(1) Bonds are also collateralized by $6,571,000 in cash.

8.  Line of Credit

The Partnership has a $15 million revolving loan credit agreement (the Line of 
Credit) with The First National Bank of Boston (the Bank).  The Line of Credit 
provides interim financing for the acquisition of multifamily residential 
properties.  It expires on December 19, 1998.  The Line of Credit bears 
interest, which is payable monthly, at 1/2% above the Bank's base rate (which 
base rate was 9% as of June 30, 1998).  In addition, the Partnership pays a 
facility fee of 1/4 of 1% on the unused portion of the line which is payable 
quarterly in arrears.  Because the Partnership had no collateral pledged at 
June 30, 1998, the Partnership's borrowing base under the Line of Credit was 
zero.  The Partnership may provide collateral for the Line of Credit, subject 
to the approval of the Bank, to change its borrowing base.  The Partnership 
did not have any borrowings against the Line of Credit at June 30, 1998.  The 
Line of Credit contains convenants which include, among others, restrictions 
on the amount of indebtedness the Partnership may incur and minimum debt 
service coverage requirements.

9. Transactions with Related Parties

Substantially all of the Partnership's general and administrative expenses are 
paid by AFCA 4 or an affiliate and reimbursed by the Partnership.  The amount 
of such expenses reimbursed to AFCA 4 during 1998 was $618,738 ($244,325 for 
the quarter ended June 30, 1998).  AFCA 4 or an affiliate also paid $150,683 
($68,432 for the quarter ended June 30, 1998) in costs capitalized by the 
Partnership during 1998 which were reimbursed by the Partnership.  The 
capitalized costs were incurred in connection with the offering of multifamily 
housing revenue refunding bonds and the acquisition of real estate.  The 
reimbursed expenses are presented on a cash basis and do not reflect accruals 
made at quarter end.  


<PAGE>                               - 7 -
AMERICA FIRST APARTMENT INVESTORS, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1998
(UNAUDITED)

Pursuant to the Limited Partnership Agreement, AFCA 4 is entitled to an 
administrative fee from the Partnership based on the original amount of the 
mortgage bonds which were foreclosed on and the purchase price of any 
additional properties acquired by the Partnership.  The amount of such fees 
paid to AFCA 4 in 1998 was $222,750 ($111,375 for the quarter ended June 30, 
1998.  

Pursuant to the terms of the Limited Partnership Agreement, AFCA 4 is entitled 
to receive a property acquisition fee from the Partnership in connection with 
the identification, evaluation and acquisition of additional properties and 
the financing thereof.  No such fees were paid to AFCA 4 during 1998.

An affiliate of AFCA 4 was retained to provide property management services 
for Covey at Fox Valley, The Park at Fifty Eight, Shelby Heights, Coral Point, 
Jefferson Place, Avalon Ridge (through April 1998), Park at Countryside, The 
Retreat, Jackson Park Place and Park Trace Apartments.  The fees for services 
provided represent the lower of (i) costs incurred in providing management of 
the property, or (ii) customary fees for such services determined on a 
competitive basis and amounted to $346,831 ($168,426 for the quarter ended 
June 30, 1998) in 1998.



















































<PAGE>                               - 8 -
     Item 2.  Management's Discussion and Analysis of Financial Condition and 
Results of Operations

Liquidity and Capital Resources

America First Tax Exempt Mortgage Fund 2 (the Prior Partnership) originally 
acquired nine tax-exempt mortgage bonds, the proceeds of which were used to 
provide construction and/or permanent financing for eight multifamily housing 
properties and one commercial property.  The Prior Partnership subsequently 
acquired five of the properties through foreclosure or deed in lieu of 
foreclosure and one tax-exempt mortgage bond was prepaid in full.  During 
1996, the Prior Partnership acquired an additional multifamily property which 
is adjacent to one of the foreclosed properties that was originally intended 
to be part of a consolidated property.

On August 20, 1996, the Prior Partnership merged with America First Apartment 
Investors, L.P. (the Partnership).  Under the terms of the merger agreement, 
the Partnership was the surviving partnership and effectively took over the 
operations of the Prior Partnership.  Unit holders of the Prior Partnership 
received one Beneficial Unit Certificate (BUC) of the New Partnership for each 
BUC they held in the Prior Partnership as of the record date.  The Prior 
Partnership was terminated under the provisions of the Prior Partnership's 
Partnership Agreement.

During 1996, the Partnership acquired The Park at Fifty-Eight Phase I and Park 
at Countryside and during 1997 the Partnership acquired The Retreat and Park 
Trace Apartments.  In addition, Jackson Park Place was conveyed to the 
Partnership during 1997 through a deed in lieu of foreclosure.  At June 30 
1998, the Partnership held eight real estate properties with a total 
depreciated cost of $63,035,490.

The following table shows the various occupancy levels of the properties 
owned or financed by the Partnership at June 30, 1998:

<TABLE>
<CAPTION>
                                                                                                       Number      Percentage
                                                                                        Number       of Units        of Units
Property Name                          Location                                       of Units       Occupied        Occupied
-------------------------------        -----------------------                       ----------     ----------     -----------
<S>                                    <C>                                           <C>            <C>            <C>
Jackson Park Place                     Fresno, CA                                          296            286             97%
Covey at Fox Valley                    Aurora, IL                                          216            206             95%
The Park at Fifty Eight                Chattanooga, TN                                     196            189             96%
Shelby Heights                         Bristol, TN                                         100             98             98%
Coral Point                            Mesa, AZ                                            336            322             96%
Park at Countryside                    Port Orange, FL                                     120            119             99%
The Retreat                            Atlanta, GA                                         226            219             97%
Park Trace Apartments                  Norcross, GA                                        260            250             96%
                                                                                     ----------     ----------     -----------
                                                                                         1,750          1,689             97%
                                                                                     ==========     ==========     ===========
The Exchange at Palm Bay               Palm Bay, FL                                     72,002(1)      60,900(1)          85%
                                                                                     ==========     ==========     ===========
</TABLE>
(1) Represents square feet.

Net rental income earned on the properties owned by the Partnership represents 
its principal source of income and distributable cash.  The Partnership may 
draw on reserves to pay operating expenses or to supplement cash distributions 
to Beneficial Unit Certificate (BUC) Holders.  















<PAGE>                               - 9 -
On April 2, 1998, the Partnership received proceeds of $13,090,000 through the 
offering of multifamily housing revenue refunding bonds on Coral Point.  The 
bonds were rated "A" by Standard and Poor's Corporation, bear interest at an 
effective rate of 4.96% and have a 10-year maturity.  Proceeds from the 
offering will be utilized to acquire additional multifamily housing properties.

On May 1, 1998, the Partnership sold its tax-exempt mortgage bond which was 
collateralized by Avalon Ridge.  The tax-exempt mortgage bond was sold for 
$18,755,000 plus accrued interest.  The net unrealized holding loss of 
$5,748,474 on such bond was eliminated thus Partners' Capital was increased by 
the same amount.  Proceeds from the sale will be utilized to acquire 
additional multifamily housing properties.

The Partnership has a $15 million revolving loan credit agreement (the Line of 
Credit) with the First National Bank of Boston (the Bank) that may be used by 
the Partnership to provide interim financing for the acquisition of 
multifamily residential properties.  The Line of Credit expires on December 
19, 1998.  The Line of Credit bears interest at 1/2% above the Bank's base 
rate (which base rate was 9% as of June 30, 1998).  Because the Partnership 
had no collateral pledged at June 30, 1998, the Partnership's borrowing base 
under the Line of Credit was zero.  The Partnership may provide collateral for 
the Line of Credit, subject to the approval of the Bank, to change its 
borrowing base.  The Partnership did not have any borrowings against the Line 
of Credit at June 30, 1998.  The Line of Credit contains convenants which 
include, among others, restrictions on the amount of indebtedness the 
Partnership may incur and minimum debt service coverage requirements.  The 
Partnership intends to repay any borrowings under the Line of Credit through 
the refunding of existing tax-exempt bonds that are associated with certain 
properties owned by the Partnership.

During the six months ended June 30, 1998, $646,940 ($540,817 for the quarter 
ended June 30, 1998) of undistributed income was added to reserves.  The total 
amount held in reserves at June 30, 1998, was $32,293,964.  Future 
distributions to BUC Holders will depend upon the amount of net rental income  
the Partnership receives, the size of reserves established by the Partnership 
and the extent to which withdrawals are made from reserves.  

The Partnership believes that cash provided by operating activities, its Line 
of Credit, proceeds from the issuance of tax-exempt mortgage bonds and, if 
necessary, withdrawals from the Partnership's reserves will be adequate to 
meet its short-term and long-term liquidity requirements, including the 
payments of distributions to BUC Holders.  Under the terms of the Partnership 
Agreement, the Partnership has the authority to enter into short-term and 
long-term debt financing arrangements.  The Partnership is not authorized to 
issue additional BUCs to meet short-term and long-term liquidity requirements.

Distributions

Cash distributions paid or accrued per BUC were as follows:
<TABLE>
<CAPTION>
                                                                                            For the Six           For the Six
                                                                                           Months Ended          Months Ended
                                                                                          June 30, 1998         June 30, 1997
                                                                                         ---------------       ---------------
<S>                                                                                      <C>                   <C>
Regular monthly distributions
	Income                                                                                  $        .1393        $        .2196 
	Return of capital                                                                                .2357                 .1554 
                                                                                         ---------------       ---------------
                                                                                         $        .3750        $        .3750 
                                                                                         ===============       ===============
Distributions
	Paid out of current and prior undistributed cash flow                                   $        .3750        $        .3750 
                                                                                         ===============       ===============
</TABLE>










<PAGE>                               - 10 -
Asset Quality 

It is the policy of the Partnership to make a periodic review of its real 
estate and adjust, when necessary, the carrying value of such real estate.  
Each real estate property held by the Partnership is recorded at the lower of 
cost or net realizable value.  The carrying value of each real estate property 
owned by the Partnership is adjusted when there are significant declines in 
the estimated net realizable value.    

Internal property valuations and reviews performed during the six months ended 
June 30, 1998, indicated that the real estate recorded on the balance sheet at 
June 30, 1998, required no adjustments to the current carrying amount.

Results of Operations

The tables below compare the results of operations for each period shown.

<TABLE>
<CAPTION>
                                                                              For the             For the            Increase
                                                                        Quarter Ended       Quarter Ended           (Decrease)
                                                                        June 30, 1998       June 30, 1997           From 1997
                                                                       ---------------     ---------------     ---------------
<S>                                                                    <C>                 <C>                 <C>
Rental income                                                          $    3,257,012      $    2,331,340      $      925,672 
Mortgage bond investment income                                               561,637             421,444             140,193
Contingent interest                                                              -                290,520            (290,520)
Interest income on temporary cash investments                                 313,555              22,878             290,677
                                                                       ---------------     ---------------     ---------------
                                                                            4,132,204           3,066,182           1,066,022
                                                                       ---------------     ---------------     ---------------
Real estate operating expenses                                              1,515,315           1,139,355             375,960
Depreciation                                                                  614,273             477,322             136,951 
Interest expense                                                              611,137             381,864             229,273
General and administrative expenses                                           355,938             269,078              86,860
                                                                       ---------------     ---------------     ---------------
                                                                            3,096,663           2,267,619             829,044 
                                                                       ---------------     ---------------     ---------------
Net income                                                             $    1,035,541      $      798,563      $      236,978 
                                                                       ===============     ===============     ===============
</TABLE>
<TABLE>
<CAPTION>
                                                                          For the Six         For the Six            Increase
                                                                         Months Ended        Months Ended           (Decrease)
                                                                        June 30, 1998       June 30, 1997           From 1997
                                                                       ---------------     ---------------     ---------------
<S>                                                                    <C>                 <C>                 <C>
Rental income                                                          $    6,346,936      $    4,024,158      $    2,322,778 
Mortgage bond investment income                                               839,201           1,053,948            (214,747)
Contingent interest                                                              -                290,520            (290,520)
Interest income on temporary cash investments                                 387,905              28,866             359,039
                                                                       ---------------     ---------------     ---------------
                                                                            7,574,042           5,397,492           2,176,550
                                                                       ---------------     ---------------     ---------------
Real estate operating expenses                                              3,000,547           1,805,379           1,195,168
Depreciation                                                                1,228,547             810,211             418,336 
Interest expense                                                            1,041,889             547,121             494,768
General and administrative expenses                                           693,411             539,163             154,248
                                                                       ---------------     ---------------     ---------------
                                                                            5,964,394           3,701,874           2,262,520 
                                                                       ---------------     ---------------     ---------------
Net income                                                             $    1,609,648      $    1,695,618      $      (85,970) 
                                                                       ===============     ===============     ===============
</TABLE>











<PAGE>                               - 11 -
Rental income increased for the quarter and six months ended June 30, 1998, 
compared to the same periods in 1997.  The increase for the quarter was 
primarily attributable to:  (i) a $482,000 increase resulting from the 
acquisition of Park Trace Apartments in October 1997; (ii) a $161,000 increase 
resulting from the acquisition of Jackson Park Place in the settlement of the 
mortgage bond secured by this property in May 1997; (iii) a $118,000 increase 
in rental income at Coral Point due primarily to an increase in occupancy (iv) 
a $77,000 increase resulting from the acquisition of The Retreat in April 
1997; (v) a $61,000 increase resulting from an increase in leased space at The 
Exchange at Palm Bay; and (vi) a $27,000 increase in rental income at the 
Partnership's other properties.  The increase for the six months was primarily 
attributable to:  (i) a $922,000 increase resulting from the acquisition of 
Park Trace Apartments in October 1997; (ii) a $603,000 increase resulting from 
the acquisition of Jackson Park Place in the settlement of the mortgage bond 
secured by this property in May 1997; (iii) a $482,000 increase resulting from 
the acquisition of The Retreat in April 1997; (iv) a $129,000 increase in 
rental income at Coral Point due primarily to an increase in occupancy (v) a 
$113,000 increase resulting from an increase in leased space at The Exchange 
at Palm Bay; and (vi) a $74,000 increase in rental income at the Partnership's 
other properties.

Mortgage bond investment income increased for the quarter ended June 30, 1998, 
compared to the same period in 1997.  The increase is attributable to:  (i) a 
$406,000 increase in such income from the tax-exempt bond collateralized by 
Avalon Ridge which was sold on May 1, 1998; partially offset by (ii) a 
$204,000 decrease resulting from the disposition of the Jefferson Place 
mortgage bond in July 1997; and (iii) a $62,000 decrease resulting from the 
acquisition of Jackson Park Place in settlement of the mortgage bond for real 
estate in May 1997.  

Mortgage bond investment income decreased for the six months ended June 30, 
1998, compared to the same period in 1997.  The decrease is primarily 
attributable to:  (i) a $464,000 decrease resulting from the disposition of 
the Jefferson Place mortgage bond in July 1997; (ii) a $249,000 decrease 
resulting from the acquisition of Jackson Park Place in settlement of the 
mortgage bond for real estate in May 1997; partially offset by (iii) a 
$498,000 increase in cash flow received from the tax-exempt bond 
collateralized by Avalon Ridge which was sold on May 1, 1998.  

The Partnership earned contingent interest income of $290,520 for the quarter 
and six months ended June 30, 1997, in conjunction with the acquisition of 
Jackson Park Place in settlement of the mortgage bond in May 1997.  No such 
income was earned for the quarter and six month periods ended June 30, 1998.

Real estate operating expenses increased for the quarter ended June 30, 1998, 
compared to the same period in 1997.  This increase is attributable to:  (i) a 
$198,000 increase resulting from the acquisition of Park Trace Apartments in 
October 1997; (ii) a $91,000 increase resulting from the acquisition of 
Jackson Park Place in May 1997; (iii) a $68,000 increase resulting from the 
acquisition of The Retreat in April 1997; and (iv) a $19,000 increase in real 
estate operating expenses at the Partnerships other properties.

Excluding property tax refunds of approximately $180,000 received during the 
quarter ended March 31, 1997, real estate operating expenses increased 
$1,015,168 for the six months ended June 30, 1998, compared to the same period 
in 1997.  This increase is attributable to:  (i) a $435,000 increase resulting 
from the acquisition of Park Trace Apartments in October 1997; (ii) a $299,000 
increase resulting from the acquisition of Jackson Park Place in May 1997; 
(iii) a $262,000 increase resulting from the acquisition of The Retreat in 
April 1997; and (iv) a $19,000 increase in real estate operating expenses at 
the Partnerships other properties.

Depreciation expense increased for the quarter and six months ended June 30, 
1998, compared to the same periods in 1997.  The increase for the quarter is 
primarily attributable to:  (i) a $107,000 increase resulting from the 
acquisition of Park Trace Apartments in October 1997; (ii) a $34,000 increase 
resulting from the acquisition of Jackson Park Place in May 1997; partially 
offset by (iii) a $4,000 decrease in depreciation expense on the Partnership's 
other properties.  The increase for the six months is primarily attributable 
to:  (i) a $214,000 increase resulting from the acquisition of Park Trace 
Apartments in October 1997; (ii) a $131,000 increase resulting from the 
acquisition of Jackson Park Place in May 1997; (iii) a $67,000 increase 
resulting from the acquisition of The Retreat in April 1997; and (iv) a $6,000 
increase in depreciation expense on the Partnership's other properties.


<PAGE>                               - 12 -
Interest expense increased for the quarter and six months ended June 30, 1998, 
compared to the same periods in 1997.  This increase is attributable to 
interest expense of $335,000 and $639,000 incurred for the quarter and six 
months ended June 30, 1998, respectively, on bonds payable of $20,915,000 
which were issued in December 1997 and interest of $170,000 incurred for the 
quarter and six months ended June 30, 1998, on bonds payable issued in April 
1998.  The increase in interest expense for the quarter was partially offset 
by a decrease in interest of $276,000 due primarily to the reduction of the 
average amount borrowed by the Partnership on its Line of Credit used to 
acquire new properties.  Contributing to the increase for the six months ended 
June 30, 1998, compared to the same period in 1997, was an increase in 
interest expense of $46,000 incurred on bonds payable issued in March 1997 
which was partially offset by a decrease of $360,000 in interest expense on 
the Partnership's Line of Credit.

Interest income on temporary cash investments increased for the quarter and 
six months ended June 30, 1998, compared to the same periods in 1997 due 
primarily to an increase in the average reserve balance. Additions made to the 
Partnership reserves during 1997 and 1998 were attributable primarily to the 
temporary investment of proceeds from the offerings of multifamily housing 
revenue refunding bonds and proceeds received from the disposition of the 
Avalon Ridge mortgage bond.

General and administrative expenses increased for the quarter and six months 
ended June 30, 1998, compared to the same periods in 1997.  The increase for 
the quarter is primarily due to:  (i) an increase of approximately $55,000 in 
administrative fees resulting from the acquisition of properties during 1997; 
and (ii) net increases of approximately $32,000 in other general and 
administrative expenses.  The increase for the six months is primarily due 
to:  (i) an increase of approximately $110,000 in administrative fees 
resulting from the acquisition of properties during 1997 and (ii) net 
increases of approximately $42,000 in other general and administrative 
expenses.

This report contains forward looking statements that reflect management's 
current beliefs and estimates of future economic circumstances, industry 
conditions, the Partnership's performance and financial results.  All 
statements, trend analysis and other information concerning possible or 
assumed future results of operations of the Partnership and the real estate 
investments it has made (including, but not limited to, the information 
contained in "Management's Discussion and Analysis of Financial Condition and 
Results of Operations"), constitute forward-looking statements.  BUC holders 
and others should understand that these forward looking statements are subject 
to numerous risks and uncertainties and a number of factors could affect the 
future results of the Partnership and could cause those results to differ 
materially from those expressed in the forward looking statements contained 
herein.

     Item 3.  Quantitative and Qualitative Disclosures About Market Risk.  
The requirements of Item 3 of Form 10-Q are not applicable to the Partnership 
prior to its Annual Report on Form 10-K for the year ending December 31, 1998.

























<PAGE>                               - 13 -
PART II.  OTHER INFORMATION

     Item 6.   Exhibits and Reports on Form 8-K

          (a)  Exhibits

               3.   Articles of Incorporation and Bylaws of America First 
                    Fiduciary Corporation Number Eight (incorporated by 
                    reference to Form S-11 Registration Statement filed May 8, 
                    1986, with the Securities and Exchange Commission by 
                    America First Tax Exempt Mortgage Fund 2 Limited 
                    Partnership (Commission File No. 33-5521)).

               4(a) Form of Certificate of Beneficial Unit Certificate 
                    incorporated by reference to Exhibit 4.1 to Registration 
                    Statement on Form S-4 (Commission File No. 333-2920) filed 
                    by the Registrant on March 29, 1996).

               4(b) Agreement of Limited Partnership of the Registrant 
                    (incorporated by reference to Exhibit 4(b) to Form 8-K 
                    (Commission File No. 0-20737) filed by the Registrant on 
                    August 23, 1996).

               4(c) Agreement of Merger, dated March 28, 1996, between the 
                    Registrant and America First Tax Exempt Mortgage Fund 2 
                    Limited Partnership (incorporated by reference to Exhibit 
                    4.3 to Amendment No. 1 to Registration Statement on Form 
                    S-4 (Commission File No. 333-2920) filed by the Registrant 
                    on May 17, 1996).
               
              10(a) Settlement Agreement among the Registrant and Jackson Park 
                    Place, Artel Farms, Inc., and David A. Dyck dated April 
                    11, 1997 (incorporated herein by reference to Form 10-Q 
                    dated June 30, 1997 filed pursuant to Section 13 or 15(d) 
                    of the Securities Exchange Act of 1934 by America First 
                    Apartment Investors, L.P. (Commission File No. 0-20737)).

              10(b) $12,410,000 Promissory Note, dated December 11, 1997, 
                    from Park Trace Apartments Limited Partnership to the City 
                    of Aurora, Illinois (The Covey at Fox Valley Apartment 
                    Project) Series 1997 (incorporated herein by reference to 
                    Form 10-K dated December 31, 1997 filed pursuant to 
                    Section 13 or 15(d) of the Securities Exchange Act of 1934 
                    by America First Apartment Investors, L.P.  (Commission 
                    File No. 0-20737)).

              10(c) Loan Agreement, dated December 1, 1997, between Park 
                    Trace Apartments Limited Partnership and City of Aurora, 
                    Illinois (The Covey at fox Valley Apartment Project) 
                    Series 1997 (incorporated herein by reference to Form 10-K 
                    dated December 31, 1997 filed pursuant to Section 13 or 
                    15(d) of the Securities Exchange Act of 1934 by America 
                    First Apartment Investors, L.P.  (Commission File No. 
                    0-20737)).

              10(d) Indenture of Trust, dated December 1, 1997, between City 
                    of Aurora, Illinois and UMB Bank, National Association 
                    (The Covey at Fox Valley Apartment Project) Series 1997 
                    (incorporated herein by reference to Form 10-K dated 
                    December 31, 1997 filed pursuant to Section 13 or 15(d) 
                    of the Securities Exchange Act of 1934 by America First 
                    Apartment Investors, L.P.  (Commission File No. 
                    0-20737)).

              10(e) Revolving Credit Loan Agreement, dated December 19, 
                    1996, between America First Apartment Investors, L.P. 
                    and The First National Bank of Boston (incorporated 
                    herein by reference to Form 10-K dated December 31, 1997 
                    filed pursuant to Section 13 or 15(d) of the Securities 
                    Exchange Act of 1934 by America First Apartment 
                    Investors, L.P.  (Commission File No. 0-20737)).





<PAGE>                              - 14 -
              10(f) $1,385,000 Promissory Note, dated April 2, 1998, from 
                    Arizona Coral Point Apartments Limited Partnership to The 
                    Industrial Development authority of the county of Maricopa 
                    (Coral Point Apartments Project) Series 1998A and 1998B.  
                    (To be supplied by amendment.)

              10(f) $11,705,000 Promissory Note, dated April 2, 1998, from 
                    Arizona Coral Point Apartments Limited Partnership to The 
                    Industrial Development authority of the county of Maricopa 
                    (Coral Point Apartments Project) Series 1998A and 1998B.  
                    (To be supplied by amendment.)

              10(g) Loan Agreement, dated March 1, 1998, between The 
                    Industrial Development Authority of the County of Maricopa 
                    and Arizona Coral Point Apartments Limited Partnership 
                    (Coral Point Apartments Project) Series 1998A and 1998B.  
                    (To be supplied by amendment.)

              10(h) Indenture of Trust, dated March 1, 1998, between The 
                    Industrial Development Authority of the County of Maricopa 
                    and UMB Bank, N.A. (Coral Point Apartments Project) Series 
                    1998A and 1998B.  (To be supplied by amendment.)

          (b)  Form 8-K

               The registrant filed the following report on Form 8-K during 
               the quarter for which this report is filed:

               Item Reported      Financial Statements Filed   Date of Report

               2. Acquisition            Yes                     May 1, 1998
                  or Disposition
                  of Assets











































<PAGE>                              - 15 -
	                                  SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the 
registrant has duly caused this report to be signed on its behalf by the 
undersigned, thereunto duly authorized.

Dated:  August 13, 1998       AMERICA FIRST APARTMENT INVESTORS, L.P.

                              By America First Capital
                                   Associates Limited
                                   Partnership Four, General
                                   Partner of the Registrant

                              By America First Companies L.L.C.,
                                   General Partner of America First Capital
                                   Associates Limited Partnership Four

                              By /s/ Michael Thesing             
                                   Michael Thesing
                                   Vice President and Principal 
                                   Financial Officer























































<PAGE>                               - 16 -