--------------------------------------------------------------------------------
                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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



                                   FORM 10-QSB


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



             QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934


                  For the quarterly period ended March 31, 2003


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



                         Commission file number 0-11973


                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP
             Organized pursuant to the Laws of the State of Maryland


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



        Internal Revenue Service - Employer Identification No. 52-1321492

                 11200 Rockville Pike, Rockville, Maryland 20852

                                 (301) 468-9200


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





Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the  registrant  was required to file such reports) and (2) has been
subject to such filing requirements for the past 90 days. Yes |X| No o




--------------------------------------------------------------------------------
<PAGE>

                CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                              INDEX TO FORM 10-QSB

                      FOR THE QUARTER ENDED MARCH 31, 2003



                                                                           Page
                                                                           ----
Part I - FINANCIAL INFORMATION

Item 1.  Financial Statements

         Balance Sheets
           - March 31, 2003 and December 31, 2002........................    1

         Statements of Operations and Accumulated Losses
           - for the three months ended March 31, 2003 and 2002..........    2

         Statements of Cash Flows
           - for the three months ended March 31, 2003 and 2002..........    3

         Notes to Financial Statements
           - March 31, 2003 and 2002.....................................    4

Item 2.  Management's Discussion and Analysis of Financial Condition
           and Results of Operations.....................................    9

Item 3.  Controls and Procedures.........................................   12


Part II - OTHER INFORMATION

Item 5.   Other Information...............................................  12

Item 6.   Exhibits and Reports on Form 8-K................................  13

Signature.................................................................  14

Certifications of Quarterly Report Pursuant to 18 U.S.C. Section 1350.....  15


<PAGE>
Part I. FINANCIAL INFORMATION
        ---------------------
Item 1. Financial Statements
        ---------------------

                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                                 BALANCE SHEETS


                                     ASSETS

<TABLE>
<CAPTION>
                                                                                        March 31,     December 31,
                                                                                          2003            2002
                                                                                      ------------    ------------
                                                                                       (Unaudited)
<S>                                                                                   <C>             <C>
Investments in and advances to partnerships .......................................   $  1,548,563    $  1,360,493
Investment in partnership held for transfer .......................................             --           7,577
Cash and cash equivalents .........................................................      3,794,727       3,420,489
Acquisition fees, principally paid to related parties,
  net of accumulated amortization of $235,606 and $232,563, respectively ..........        129,585         132,628
Property purchase costs,
  net of accumulated amortization of $247,572 and $244,318, respectively ..........        142,946         146,200
Other assets ......................................................................             87         335,845
                                                                                      ------------    ------------

   Total assets ...................................................................   $  5,615,908    $  5,403,232
                                                                                      ============    ============




                        LIABILITIES AND PARTNERS' CAPITAL



Due on investments in partnerships ................................................   $  1,400,000    $  1,900,000
Accrued interest payable ..........................................................      2,531,762       2,677,938
Accounts payable and accrued expenses .............................................         85,535         113,301
                                                                                      ------------    ------------

   Total liabilities ..............................................................      4,017,297       4,691,239
                                                                                      ------------    ------------

Commitments and contingencies

Partners' capital:

  Capital paid in:
    General Partners ..............................................................          2,000           2,000
    Limited Partners ..............................................................     50,015,000      50,015,000
                                                                                      ------------    ------------

                                                                                        50,017,000      50,017,000

  Less:
    Accumulated distributions to partners .........................................    (13,904,726)    (13,904,726)
    Offering costs ................................................................     (5,278,980)     (5,278,980)
    Accumulated losses ............................................................    (29,234,683)    (30,121,301)
                                                                                      ------------    ------------

      Total partners' capital .....................................................      1,598,611         711,993
                                                                                      ------------    ------------

      Total liabilities and partners' capital .....................................   $  5,615,908    $  5,403,232
                                                                                      ============    ============
</TABLE>

                          The accompanying notes are an
                             integral part of these
                              financial statements.

                                       -1-

<PAGE>
Part I. FINANCIAL INFORMATION
        ---------------------
Item 1. Financial Statements
        ---------------------

                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                            STATEMENTS OF OPERATIONS

                             AND ACCUMULATED LOSSES

                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                        For the three months ended
                                                                                 March 31,
                                                                       ----------------------------
                                                                           2003           2002
                                                                       ------------    ------------
<S>                                                                    <C>             <C>
Share of income from partnerships ..................................   $    409,720    $    615,781
                                                                       ------------    ------------

Other revenue and expenses:

  Revenue:
    Interest and other income ......................................         11,167          10,085
    Gain from extinguishment of debt ...............................        670,099              --
                                                                       ------------    ------------

                                                                            681,266          10,085
                                                                       ------------    ------------

  Expenses:
    Interest .......................................................         31,500          57,935
    General and administrative .....................................         80,821          63,677
    Management fee .................................................         62,499          62,499
    Professional fees ..............................................         23,250          22,250
    Amortization of deferred costs .................................          6,298           7,002
                                                                       ------------    ------------

                                                                            204,368         213,363
                                                                       ------------    ------------

      Total other revenue and expenses .............................        476,898        (203,278)
                                                                       ------------    ------------

Net income .........................................................        886,618         412,503

Accumulated losses, beginning of period ............................    (30,121,301)    (34,051,197)
                                                                       ------------    ------------

Accumulated losses, end of period ..................................   $(29,234,683)   $(33,638,694)
                                                                       ============    ============



Net income allocated to General Partners (1.51%) ...................   $     13,388    $      6,229
                                                                       ============    ============


Net income allocated to Initial and Special Limited Partners (1.49%)   $     13,211    $      6,146
                                                                       ============    ============


Net income allocated to Additional Limited Partners (97%) ..........   $    860,019    $    400,128
                                                                       ============    ============


Net income per unit of Additional Limited Partner Interest,
  based on 50,000 units outstanding ................................   $      17.20    $       8.00
                                                                       ============    ============

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

                                       -2-

<PAGE>
Part I. FINANCIAL INFORMATION
        ---------------------
Item 1. Financial Statements
        ---------------------

                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                            STATEMENTS OF CASH FLOWS

                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                   For the three months ended
                                                                                            March 31,
                                                                                   --------------------------
                                                                                      2003           2002
                                                                                   ----------     -----------
<S>                                                                                <C>            <C>
Cash flows from operating activities:
  Net income ...................................................................   $   886,618    $   412,503

  Adjustments  to  reconcile  net  income  to net cash  provided  by  (used  in)
    operating activities:
    Share of income from partnerships ..........................................      (409,720)      (615,781)
    Gain from extinguishment of debt ...........................................      (670,099)            --
    Amortization of deferred costs .............................................         6,298          7,002

    Changes in assets and liabilities:
      Increase in advances to partnerships .....................................            --         (1,118)
      Decrease (increase) in other assets ......................................       335,758           (262)
      Increase in accrued interest payable .....................................        31,500         57,935
      Decrease in accounts payable and accrued expenses ........................       (27,766)       (18,806)
                                                                                   -----------    -----------

        Net cash provided by (used in) operating activities ....................       152,589       (158,527)
                                                                                   -----------    -----------

Cash flows from investing activities:
  Receipt of distributions from partnerships ...................................       221,443        346,445
  Additional proceeds from disposition of investment in partnership ............           206             --
                                                                                   -----------    -----------

        Net cash provided by investing activities ..............................       221,649        346,445
                                                                                   -----------    -----------

Net increase in cash and cash equivalents ......................................       374,238        187,918

Cash and cash equivalents, beginning of period .................................     3,420,489      3,242,912
                                                                                   -----------    -----------

Cash and cash equivalents, end of period .......................................   $ 3,794,727    $ 3,430,830
                                                                                   ===========    ===========

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

                                       -3-

<PAGE>
                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                          NOTES TO FINANCIAL STATEMENTS

                             March 31, 2003 and 2002

                                   (Unaudited)


1.   BASIS OF PRESENTATION

     In the opinion of C.R.I.,  Inc. (CRI), the Managing  General  Partner,  the
accompanying unaudited financial statements reflect all adjustments,  consisting
of normal recurring accruals, necessary for a fair presentation of the financial
position of Capital Realty Investors-II Limited Partnership (the Partnership) as
of March 31, 2003,  and the results of its operations and its cash flows for the
three months ended March 31, 2003 and 2002.  The results of  operations  for the
interim  period  ended March 31, 2003,  are not  necessarily  indicative  of the
results to be expected for the full year.

     The  accompanying  unaudited  financial  statements  have been  prepared in
conformity with accounting principles generally accepted in the United States of
America  and with the  instructions  to Form  10-QSB.  Certain  information  and
accounting  policies and  footnote  disclosures  normally  included in financial
statements prepared in conformity with accounting  principles generally accepted
in the United States of America have been condensed or omitted  pursuant to such
instructions. These condensed financial statements should be read in conjunction
with the financial  statements and notes thereto  included in the  Partnership's
annual report on Form 10-KSB at December 31, 2002.

     In January  2003,  the  Financial  Accounting  Standards  Board issued FASB
Interpretation No. 46 (FIN 46), Consolidation of Variable Interest Entities. FIN
46 clarifies the application of Accounting  Research  Bulletin 51,  Consolidated
Financial Statements, for certain entities that do not have sufficient equity at
risk for the entity to finance its activities  without  additional  subordinated
financial  support from other  parties or in which equity  investors do not have
the  characteristics  of a controlling  financial interest  ("variable  interest
entities").  Variable  interest  entities  within  the  scope  of FIN 46 will be
required  to  be  consolidated  by  their  primary   beneficiary.   The  primary
beneficiary  of a variable  interest  entity is  determined to be the party that
absorbs a majority of the entity's  expected losses,  receives a majority of its
expected  returns,  or both.  FIN 46 applies  immediately  to variable  interest
entities  created after January 31, 2003, and to variable  interest  entities in
which an enterprise obtains an interest after that date. It applies in the first
fiscal  year or interim  period  beginning  after  June 15,  2003,  to  variable
interest  entities  in which an  enterprise  holds a variable  interest  that it
acquired before February 1, 2003. The Managing General Partner is in the process
of  determining  what impact,  if any, the adoption of the  provisions of FIN 46
will have upon the Partnership's  financial  condition and results of operations
related to the Partnership's investments in Local Partnerships, and has complied
with the disclosure requirements of FIN 46 in these financial statements.  As of
March  31,  2003,  the  Partnership's  maximum  loss  exposure  related  to  its
investments in and advances to partnerships is limited to the remaining  balance
of $1,548,563.


2.   INVESTMENTS IN AND ADVANCES TO PARTNERSHIPS

a.   Due on investments in partnerships and accrued interest payable
     ---------------------------------------------------------------

                               Purchase money note
                               -------------------

     The  Partnership's  obligation  with  respect  to its  investment  in Local
Partnerships,  in the  form  of a  nonrecourse  purchase  money  note  having  a
principal  balance of $1,400,000 plus accrued interest of $2,531,762 as of March
31, 2003, is payable in full at maturity on September 1, 2003.

                                       -4-

<PAGE>
                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                          NOTES TO FINANCIAL STATEMENTS

                             March 31, 2003 and 2002

                                   (Unaudited)


2.   INVESTMENTS IN AND ADVANCES TO PARTNERSHIPS - Continued

The purchase money note, which is nonrecourse to the Partnership,  is secured by
the  Partnership's  interest in the related Local  Partnership,  Westgate  Tower
Limited Dividend Housing Association (Westgate).  There is no assurance that the
underlying  property will have sufficient  appreciation and equity to enable the
Partnership to pay the purchase money note's principal and accrued interest when
due. If the purchase  money note is not paid in accordance  with its terms,  the
Partnership  will  either have to  renegotiate  the terms of  repayment  or risk
losing its  partnership  interest in  Westgate.  In the event that the  purchase
money note remains  unpaid upon  maturity,  the noteholder may have the right to
foreclose on the Partnership's interest in Westgate.

     The  Partnership's  inability to pay the purchase  money note principal and
accrued interest balance when due, and the resulting  uncertainty  regarding the
Partnership's  continued  ownership  interest in  Westgate,  does not  adversely
impact the Partnership's  financial condition because the purchase money note is
nonrecourse  and  secured  solely by the  Partnership's  interest  in  Westgate.
Therefore,  should the  investment in Westgate not produce  sufficient  value to
satisfy the related purchase money note, the  Partnership's  exposure to loss is
limited  because  the amount of the  nonrecourse  indebtedness  of the  maturing
purchase  money note  exceeds  the  carrying  amount of the  investment  in, and
advances to, Westgate.  Thus, even a complete loss of the Partnership's interest
in Westgate would not have a material adverse impact on the financial  condition
of the Partnership. In the event of a foreclosure, the excess of the nonrecourse
indebtedness  over  the  carrying  amount  of the  Partnership's  investment  in
Westgate would be deemed  cancellation  of indebtedness  income,  which would be
taxable to Limited Partners at a federal tax rate of up to 38.6%.  Additionally,
in the event of a  foreclosure,  the  Partnership  would lose its  investment in
Westgate  and,  likewise,  its  share of any  future  cash flow  distributed  by
Westgate from rental operations,  mortgage debt refinancings, or the sale of the
real estate.

     Interest  expense on the  Partnership's  purchase money notes for the three
months ended March 31, 2003 and 2002, was $31,500 and $57,935, respectively. The
accrued  interest  payable  on  the  purchase  money  notes  of  $2,531,762  and
$2,677,938 as of March 31, 2003, and December 31, 2002, respectively,  is due on
the maturity date of the purchase money note.

                                    Princeton
                                    ---------

     The  Partnership  defaulted on its purchase money note related to Princeton
Community  Village  Associates  (Princeton)  on  January  1,  1999 when the note
matured and was not paid.  The default  amount  included  principal  and accrued
interest  of  $500,000  and  $1,422,064,  respectively.  On August 9, 1999,  the
noteholder filed a complaint seeking  declaratory  judgment that the Partnership
had forfeited its interest in Princeton to the  noteholder.  The  litigation was
settled  effective  January 1, 2000,  when the Managing  General Partner entered
into an agreement with the noteholder  which granted the noteholder four options
to purchase the Partnership's  98.99% limited partner interest in Princeton over
a three and one-half year period,  in exchange for the  cancellation of pro-rata
portions of the then outstanding  balance of the purchase money note. As part of
the agreement,  the noteholder  extended the maturity date of the purchase money
note to January 1, 2004, and the Partnership made a payment to the noteholder on
April 21,  2000,  which was  applied  against  accrued  interest  payable on the
purchase  money  note.  However,  pursuant  to the  option  agreement  with  the
noteholder,  the  noteholder  could  exercise  its option to  acquire  the final
portion of the Partnership's interest between January 1, 2003 and June 30, 2003.

                                       -5-

<PAGE>
                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                          NOTES TO FINANCIAL STATEMENTS

                             March 31, 2003 and 2002

                                   (Unaudited)


2.   INVESTMENTS IN AND ADVANCES TO PARTNERSHIPS - Continued

     On January 1,  2003,  pursuant  to the  option  agreement,  the  noteholder
purchased the Partnership's remaining limited partner interest in Princeton, the
consideration  for which  was the  cancellation  of the  remaining  $677,676  of
purchase money note  principal and accrued  interest.  The purchase  resulted in
gain on extinguishment of debt of $670,099 for financial  statement purposes and
a total gain of $1,854,098  for federal tax purposes in 2003. On April 30, 2002,
pursuant  to the option  agreement,  the  noteholder  purchased  one-half of the
Partnership's  then-  remaining  limited  partner  interest  in  Princeton,  the
consideration  for which was the cancellation of $606,700 of purchase money note
accrued  interest.  The purchase  resulted in gain on  extinguishment of debt of
$599,123 for financial  statement  purposes and a total gain of  $1,783,122  for
federal tax purposes in 2002. On both June 1, 2001 and May 31, 2000, pursuant to
the option agreement, the noteholder purchased 26% of the Partnership's original
limited  partner  interest in  Princeton,  the  consideration  for which was the
cancellation  of a like percentage of the  then-outstanding  purchase money note
accrued interest of $392,333 and $493,027, respectively,  resulting in gain from
extinguishment of debt of $384,123 and $484,862 for financial statement purposes
in 2001 and 2000, respectively, and in a total gain of $1,583,512 and $1,921,910
for federal tax purposes in 2001 and 2000, respectively.

     Due to the subsequent  transfer of the Partnership's  remaining interest in
Princeton, the Partnership's basis in the Local Partnership,  along with the net
unamortized  acquisition fees and property purchase costs,  which totaled $7,577
as of December 31, 2002, was  reclassified to investment in partnership held for
transfer in the accompanying balance sheet at that date.

                                    Westgate
                                    --------

     The purchase money note, in the principal amount of $1,400,0000, related to
Westgate  matures on September 1, 2003 (as  previously  extended).  The Managing
General Partner will begin  discussions with the purchase money noteholder prior
to the  maturity of the Westgate  purchase  money note to  investigate  possible
alternatives  concerning this debt  obligation.  There can be no assurance about
what  course of action  will be chosen,  or whether  it will be  successful,  or
whether the Partnership will retain its interest in Westgate.

                                       -6-

<PAGE>
                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                          NOTES TO FINANCIAL STATEMENTS

                             March 31, 2003 and 2002

                                   (Unaudited)


2.   INVESTMENTS IN AND ADVANCES TO PARTNERSHIPS - Continued

b.   Summarized financial information
     --------------------------------

     Combined  statements of operations for the 12 and 14 Local  Partnerships in
which the  Partnership is invested as of March 31, 2003 and 2002,  respectively,
follow. The combined statements have been compiled from information  supplied by
the management  agents of the projects and are unaudited.  The  information  for
each of the periods is presented  separately for those Local  Partnerships which
have investment  basis (equity  method),  and for those Local  Partnerships  for
which  the  Partnership's  carrying  value is zero  (equity  method  suspended).
Appended   after  the  combined   statements  is   information   concerning  the
Partnership's  share of income from partnerships  related to cash  distributions
recorded as income, and related to the Partnership's  share of income from Local
Partnerships.

<TABLE>
<CAPTION>

                                         COMBINED STATEMENTS OF OPERATIONS
                                                    (Unaudited)


                                                                 For the three months ended
                                                                          March 31,
                                                 --------------------------------------------------------------
                                                            2003                               2002
                                                 ---------------------------        ---------------------------
                                                   Equity                             Equity
                                                   Method         Suspended           Method         Suspended
                                                 ----------      -----------        ----------       ----------
         <S>                                     <C>             <C>                <C>              <C>
         Revenue:
           Rental                                $1,424,480       $2,477,771        $1,431,666       $3,385,200
           Other                                     32,578          102,654            36,989          245,471
                                                 ----------       ----------        ----------       ----------

             Total revenue                        1,457,058        2,580,425         1,468,655        3,630,671
                                                 ----------       ----------        ----------       ----------

         Expenses:
           Operating                                850,917        1,510,770           771,608        2,132,584
           Interest                                 216,196          942,108           222,497        1,045,250
           Depreciation and amortization            200,139          439,379           188,307          630,708
                                                 ----------       ----------        ----------       ----------

             Total expenses                       1,267,252        2,892,257         1,182,412        3,808,542
                                                 ----------       ----------        ----------       ----------


         Net income (loss)                       $  189,806       $ (311,832)       $  286,243       $ (177,871)
                                                 ==========       ==========        ==========       ==========

         Cash distributions                      $       --       $  221,443        $       --       $  346,445
                                                 ==========       ==========        ==========       ==========

         Cash distributions recorded
           as income                             $       --       $  221,443        $       --       $  346,445

         Partnership's share of Local
           Partnership net income                   188,070               --           270,455               --

         Miscellaneous                                  207               --             (1,119)              --
                                                 ---------------------------         ---------------------------

         Share of income from partnerships                $409,720                             $615,781
                                                          ========                             ========

</TABLE>

                                       -7-

<PAGE>
                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                          NOTES TO FINANCIAL STATEMENTS

                             March 31, 2003 and 2002

                                   (Unaudited)


2.   INVESTMENTS IN AND ADVANCES TO PARTNERSHIPS - Continued

     All of the cash  distributions  recorded as income are included in share of
income from  partnerships  on the  statements of operations  for the  respective
periods,  and are recorded as cash receipts on the respective balance sheets. As
of March 31, 2003 and 2002, the Partnership's share of cumulative losses to date
for eight and ten of the 12 and 14 Local Partnerships exceeded the amount of the
Partnership's  investments  in and  advances  to  those  Local  Partnerships  by
$19,216,307  and  $21,058,523,  respectively.  As the Partnership has no further
obligation  to advance funds or provide  financing to these Local  Partnerships,
the  excess  losses  have  not  been  reflected  in the  accompanying  financial
statements.


3.   RELATED PARTY TRANSACTIONS

     In accordance with the terms of the Partnership Agreement,  the Partnership
is obligated to reimburse the Managing  General  Partner for its direct expenses
in connection with managing the  Partnership.  The Partnership  paid $58,214 and
$59,966 for the three month periods ended March 31, 2003 and 2002, respectively,
to the Managing General Partner as direct  reimbursement of expenses incurred on
behalf of the  Partnership.  Such  expenses  are  included  in the  accompanying
statements of operations as general and administrative expenses.

     In accordance with the terms of the Partnership Agreement,  the Partnership
is obligated to pay the Managing General Partner an annual incentive  management
fee  (Management  Fee) after all other expenses of the Partnership are paid. The
Partnership  paid the Managing  General  Partner a Management Fee of $62,499 for
each of the three month periods ended March 31, 2003 and 2002.

                                      # # #

                                       -8-

<PAGE>
Part I. FINANCIAL INFORMATION
Item 2. Management's Discussion Analysis of Financial Condition
        -------------------------------------------------------
          and Results of Operations
          -------------------------


     Capital  Realty  Investors-II   Limited   Partnership's  (the  Partnership)
Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations  section  is  based  on  the  financial   statements,   and  contains
information  that  may  be  considered  forward  looking,  including  statements
regarding  the effect of  governmental  regulations.  Actual  results may differ
materially from those  described in the forward  looking  statements and will be
affected  by  a  variety  of  factors  including  national  and  local  economic
conditions,  the  general  level of  interest  rates,  governmental  regulations
affecting  the  Partnership  and  interpretations  of  those  regulations,   the
competitive  environment in which the Partnership operates, and the availability
of working capital.

                                     General
                                     -------

     Some of the rental properties owned by the Local  Partnerships are financed
by state housing agencies.  The Managing General Partner has sold or refinanced,
and will continue to sell or refinance,  certain properties pursuant to programs
developed by these agencies.  These programs may include opportunities to sell a
property to a qualifying  purchaser  who would agree to maintain the property as
low to  moderate  income  housing,  or to  refinance  a  property,  or to obtain
supplemental  financing.  The  Managing  General  Partner  continues  to monitor
certain state  housing  agency  programs,  and/or  programs  provided by certain
lenders, to ascertain whether the properties would qualify within the parameters
of a given  program and whether  these  programs  would  provide an  appropriate
economic benefit to the limited partners of the Partnership.

     Some of the rental properties owned by the Local Partnerships are dependent
on the receipt of  project-based  Section 8 Rental Housing  Assistance  Payments
(HAP)  provided by the U.S.  Department of Housing and Urban  Development  (HUD)
pursuant  to Section 8 HAP  contracts.  Current  legislation  allows all expired
Section 8 HAP contracts  with rents at less than 100% of fair market rents to be
renewed for up to one year.  Expiring  Section 8 HAP  contracts  with rents that
exceed  100% of fair market  rents  could be renewed for up to one year,  but at
rents  reduced  to 100% of fair  market  rents  (Mark-to-Market).  All  expiring
Section 8 HAP  contracts  with rents  exceeding  comparable  market  rents,  and
properties  with mortgage  loans insured by the Federal  Housing  Administration
(FHA), became subject to the Mark-to-Market legislation.

     Mark-to-Market (M2M) implementation will reduce rental income at properties
that are currently  subsidized  at  higher-than-market  rental  rates,  and will
therefore  lower cash flow  available to meet  mortgage  payments and  operating
expenses.  In some instances,  a property will be able to meet its existing debt
service  payments  after the  reduction  in rental  income.  In this  case,  the
property  may enter  the M2M  "Lite"  program,  which  would not  require a debt
restructuring.  In the remaining  instances,  the affected  property may undergo
debt restructuring  according to terms determined by an individual  property and
operations  evaluation.  This would  involve  reducing the first  mortgage  loan
balance to an amount  supportable  by the  property's  operations,  taking  into
account the property's operating expenses and reduced income. The balance of the
amount  written down from the first  mortgage  loan would be converted to a non-
performing but accruing  (soft) second  mortgage  loan.  When the existing first
mortgage loan is bifurcated  into a first and second  mortgage  loan,  the newly
created  second  mortgage  loan will  accrue  interest at a  below-market  rate;
however,  the  Internal  Revenue  Service  issued a  ruling  in July  1998  that
concluded that the below-market  rate of interest would not generate  additional
ordinary  income.  Each property  subject to M2M will be affected in a different
manner, and it is very difficult to predict the exact form of restructuring,  or
potential tax liabilities to the limited partners, at this time. All properties,
upon entering the M2M program  (excluding M2M Lite),  are required to enter into
an agreement restricting the property's use to affordable housing for 30 years.

                                       -9-

<PAGE>
Part I. FINANCIAL INFORMATION
Item 2. Management's Discussion Analysis of Financial Condition
        -------------------------------------------------------
          and Results of Operations - Continued
          -------------------------


     Finally, under HUD's "Mark-up-to-Market"  program, properties with expiring
Section 8 HAP  contracts  that are located in high-rent  areas as defined by HUD
are eligible for rent increases  which would be necessary to bring Section 8 HAP
contract  rents in line with market rate rents.  For  properties  that enter the
program and have interest rate  subsidized FHA loans,  the rents are adjusted to
take into  account  the  benefits  the  property is already  receiving  from the
below-market  interest rate by means of a HUD-determined  adjustment factor. The
purpose of this program is to provide  incentives to owners of  properties  with
expiring  Section 8 HAP contracts not to convert these properties to market rate
housing.

     In return for  receiving  market  rate rents under  Mark-up-to-Market,  the
property  owner must enter into a five year  conditional  Section 8 HAP contract
with HUD,  subject  to the  annual  availability  of  funding  by  Congress.  In
addition,  property  owners who enter into the  Mark-up-to-  Market program will
receive  increased  cash flow as the limited  dividend  will be  increased in an
amount equal to the increase in gross rental revenues.

     As of March 31, 2003, the carrying amount of the Partnership's  investments
in and  advances  to the two Local  Partnerships  with  Section 8 HAP  contracts
expiring in the next 12 months was $0.

     The Managing  General  Partner  continues to seek  strategies  to deal with
affordable housing policy. While the Managing General Partner cannot predict the
outcome for any particular  property at this time, the Managing  General Partner
will continue to work with the Local  Partnerships  to develop  strategies  that
maximize the benefits to investors.

                          Financial Condition/Liquidity
                          -----------------------------

     The Partnership's liquidity, with unrestricted cash resources of $3,794,727
as of March 31, 2003, along with anticipated  future cash distributions from the
Local  Partnerships,  is  expected  to be  adequate  to  meet  its  current  and
anticipated  operating  cash  needs.  As of May 6, 2003,  there were no material
commitments for capital expenditures.

     The  Partnership's  obligation  with  respect  to its  investment  in Local
Partnerships,  in the  form  of a  nonrecourse  purchase  money  note  having  a
principal  balance of $1,400,000 plus accrued interest of $2,531,762 as of March
31,  2003,  is payable in full at maturity on  September  1, 2003.  The purchase
money  note,  which  is  nonrecourse  to  the  Partnership,  is  secured  by the
Partnership's interest in the related Local Partnership,  Westgate Tower Limited
Dividend  Housing  Association  (Westgate).  There  is  no  assurance  that  the
underlying  property will have sufficient  appreciation and equity to enable the
Partnership to pay the purchase money note's principal and accrued interest when
due. If the purchase  money note is not paid in accordance  with its terms,  the
Partnership  will  either have to  renegotiate  the terms of  repayment  or risk
losing its  partnership  interest in  Westgate.  In the event that the  purchase
money note remains  unpaid upon  maturity,  the noteholder may have the right to
foreclose on the Partnership's interest in Westgate.

     The  Partnership's  inability to pay the purchase  money note principal and
accrued interest balance when due, and the resulting  uncertainty  regarding the
Partnership's  continued  ownership  interest in  Westgate,  does not  adversely
impact the Partnership's  financial condition because the purchase money note is
nonrecourse  and  secured  solely by the  Partnership's  interest  in  Westgate.
Therefore,  should the  investment in Westgate not produce  sufficient  value to
satisfy the related purchase money note, the  Partnership's  exposure to loss is
limited  because  the amount of the  nonrecourse  indebtedness  of the  maturing
purchase  money note  exceeds  the  carrying  amount of the  investment  in, and
advances to, Westgate.  Thus, even a complete loss of the Partnership's interest
in Westgate would not have a material adverse impact on the financial  condition
of the Partnership. In the event of a foreclosure, the excess of the nonrecourse
indebtedness  over  the  carrying  amount  of the  Partnership's  investment  in
Westgate would be deemed  cancellation  of indebtedness  income,  which would be
taxable to Limited Partners at a federal tax rate of up to 38.6%.  Additionally,
in the event of a  foreclosure,  the  Partnership  would lose its  investment in
Westgate  and,  likewise,  its  share of any  future  cash flow  distributed  by
Westgate from rental operations,  mortgage debt refinancings, or the sale of the
real estate. The Partnership received no cash distributions from Westgate during
2002 and 2001;  thus,  in the event of a  foreclosure,  there would be no annual
impact on the cash liquidity of the Partnership.

                                      -10-

<PAGE>
Part I. FINANCIAL INFORMATION
Item 2. Management's Discussion Analysis of Financial Condition
        -------------------------------------------------------
          and Results of Operations - Continued
          -------------------------


     The sale of the  Partnership's  interest  in  Princeton  Community  Village
Associates  (Princeton) over a four year period did not affect the Partnership's
cash liquidity,  since the only  consideration  received was the cancellation of
portions of purchase money note principal and accrued interest.  The Partnership
did not  receive any cash  distributions  from  Princeton  during this four year
period.

     The Partnership closely monitors its cash flow and liquidity position in an
effort to ensure that sufficient  cash is available for operating  requirements.
For the three  month  periods  ended  March 31,  2003 and 2002,  the  receipt of
distributions  from Local  Partnerships  was adequate to support  operating cash
requirements.  Cash and cash equivalents increased during the three month period
ended  March  31,  2003,  primarily  as a result  of  distributions  from  Local
Partnerships,  and as positive  cash flow was provided by operating  activities.
All of the distributions received for the periods ended March 31, 2003 and 2002,
were from Local Partnerships for which the Partnership's carrying value is zero.
The Partnership  expects to receive a lower amount of  distributions  from these
Local  Partnerships  in future  years as more Section 8 HAP  contracts  approach
expiration,  and the related properties enter the Mark-to-Market  program,  with
the resulting reduction in rental revenues.

                              Results of Operations
                              ---------------------

     The  Partnership's  net income for the three month  period  ended March 31,
2003,  increased $474,115 from the corresponding period in 2002 primarily due to
the $670,099 gain from extinguishment of debt as a result of the transfer of the
Partnership's  remaining interest in Princeton to the noteholder pursuant to the
related option  agreement,  the  consideration for which was the cancellation of
the remaining  $677,676 of purchase money note  principal and accrued  interest.
Contributing to the increase in the  Partnership's  net income was a decrease in
interest  expense  due to lower  purchase  money note  balances,  an increase in
interest  revenue due to higher cash and cash equivalent  balances and a nominal
decrease in amortization of deferred costs. Partially offsetting the increase in
the   Partnership's   net  income  was  a  decrease  in  share  of  income  from
partnerships,  an increase in general and administrative  expenses related to an
accrual for state business taxes, and a nominal  increase in professional  fees.
The decrease in share of income from  partnerships  was  primarily the result of
three factors:  1) A decrease in cash  distributions from two Local Partnerships
recorded as income (see Note 2.b. of the notes to financial  statements);  2) an
increase in the cost of hazard  insurance at one Local  Partnership's  property;
and 3) an increase in  maintenance  costs at one Local  Partnership's  property.
Cash  distributions  recorded  as  income  decreased  as a result  of  increased
vacancies and rental  concessions at two  properties,  caused by the soft rental
market in the Chicago area where the Local Partnerships' properties are located.
The  Managing  General  Partner is not able to  predict  whether  the  increased
vacancies and rental  concessions will be permanent,  or whether they will abate
with  improvements in the economy of the  surrounding  area. The increase in the
cost of  hazard  insurance  is  expected  to be  permanent,  unless  there  is a
significant change in the insurance market. The increase in maintenance costs is
also  expected  to  be  permanent,  as  the  property  ages  and  requires  more
maintenance.

                                      -11-

<PAGE>
Part I. FINANCIAL INFORMATION
Item 2. Management's Discussion Analysis of Financial Condition
        -------------------------------------------------------
          and Results of Operations - Continued
          -------------------------


     For financial reporting purposes, the Partnership,  as a limited partner in
the Local  Partnerships,  does not record losses from the Local  Partnerships in
excess of its  investment  to the  extent  that the  Partnership  has no further
obligation to advance funds or provide financing to the Local Partnerships. As a
result, the Partnership's  share of income from partnerships for the three month
periods  ended March 31, 2003 and 2002,  did not include  losses of $314,829 and
$275,281 respectively.

     No other  significant  changes in the  Partnership's  operations have taken
place during the three month period ended March 31, 2003.


Item 3. Controls and Procedures
        -----------------------

     In February 2003,  representatives  of the Managing  General Partner of the
Partnership  carried out an  evaluation of the  effectiveness  of the design and
operation of the Partnership's  disclosure controls and procedures,  pursuant to
Exchange Act Rules 13a-14 and 15d-14.  Based on that  evaluation,  the Principal
Executive   Officer  and  Principal   Financial   Officer   concluded  that  the
Partnership's  disclosure controls and procedures are effective to alert them in
a timely manner to any material  information  relating to the  Partnership  that
must be included in the Partnership's  periodic SEC filings. In addition,  there
have been no significant  changes in the  Partnership's  internal controls or in
other factors that could  significantly  affect internal controls  subsequent to
the date of the most recent evaluation.


Part II. OTHER INFORMATION
Item 5. Other Information
        -----------------

     There  is no  established  market  for the  purchase  and  sale of units of
additional limited partner interest (Units) in the Partnership, although various
informal  secondary market services exist. Due to the limited markets,  however,
investors may be unable to sell or otherwise dispose of their Units.

                           Unregistered Tender Offers
                           --------------------------

     On March 14, 2003, Peachtree Partners (Peachtree) initiated an unregistered
tender offer to purchase an unspecified  number of the outstanding  Units in the
Partnership  at a price of $100 per Unit;  the  offer  expired  April 18,  2003.
Peachtree is unaffiliated  with the Partnership or the Managing General Partner.
The price offered was determined  solely at the discretion of Peachtree and does
not necessarily represent the fair market value of each Unit.

     On April  11,  2003,  Equity  Resource  Fund  XXII  (Equity)  initiated  an
unregistered  tender offer to purchase up to 1,200 of the  outstanding  Units in
the Partnership at a price of $120 per Unit; the offer will expire May 12, 2003.
Equity is unaffiliated with the Partnership or the Managing General Partner. The
price  offered was  determined  solely at the  discretion of Equity and does not
necessarily represent the fair market value of each Unit.

     The  Managing  General  Partner did not  express  any opinion and  remained
neutral  toward  the  unregistered  tender  offers  for the  purchase  of  Units
described above.

                                      -12-

<PAGE>
Part II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
        --------------------------------

     a.   Exhibits

          Exhibit No.               Description
          -----------               -----------

              99          Certification of Periodic Financial Report
                          Pursuant to 18 U.S.C. Section 1350

     b.   No  reports  on Form 8-K were  filed  with the  Commission  during the
          quarter ended March 31, 2003.

All other Items are not applicable.



                                      -13-

<PAGE>
                                    SIGNATURE


     In accordance  with the  requirements  of the Exchange Act, the  registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


                                  CAPITAL REALTY INVESTORS-II LIMITED
                                    PARTNERSHIP
                                  ----------------------------------------------
                                  (Registrant)

                                  by:  C.R.I., Inc.
                                       -----------------------------------------
                                       Managing General Partner




May 6, 2003                            by:  /s/ Michael J. Tuszka
-----------                                 ------------------------------------
DATE                                        Michael J. Tuszka
                                              Vice President
                                              and Chief Accounting Officer
                                              (Principal Financial Officer
                                              and Principal Accounting Officer)

                                      -14-

<PAGE>
                       CERTIFICATION OF QUARTERLY REPORT
                      Pursuant to 18 U.S.C. Section 1350,
      as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002


         I, Michael J. Tuszka, certify that:

         1.       I have  reviewed  this  quarterly  report  on Form  10-QSB  of
                  CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP;

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

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

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

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

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

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

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

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

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


                                      -15-

<PAGE>



         6.       The registrant's other certifying officer and I have indicated
                  in  this  quarterly  report  whether  there  were  significant
                  changes in internal  controls or in other  factors  that could
                  significantly  affect internal controls subsequent to the date
                  of  our  most  recent  evaluation,  including  any  corrective
                  actions with regard to significant  deficiencies  and material
                  weaknesses.


                                    CAPITAL REALTY INVESTORS-II
                                      LIMITED PARTNERSHIP
                                    --------------------------------------------
                                    (Issuer)

                                    by:  C.R.I., Inc.
                                         ---------------------------------------
                                         Managing General Partner



May 6, 2003                              by:  /s/ Michael J. Tuszka
-----------                                   ----------------------------------
DATE                                          Michael J. Tuszka,
                                                Vice President
                                                and Chief Accounting Officer
                                                (Principal Financial Officer)


     This  certification  is made solely for purpose of 18 U.S.C.  Section 1350,
subject  to the  knowledge  standard  contained  therein,  and not for any other
purpose.

                                      -16-

<PAGE>
                        CERTIFICATION OF QUARTERLY REPORT
                       Pursuant to 18 U.S.C. Section 1350,
      as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002


         I, William B. Dockser, certify that:

         1.       I have  reviewed  this  quarterly  report  on Form  10-QSB  of
                  CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP;

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

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

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

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

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

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

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


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

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


                                      -17-

<PAGE>


         6.       The registrant's other certifying officer and I have indicated
                  in  this  quarterly  report  whether  there  were  significant
                  changes in internal  controls or in other  factors  that could
                  significantly  affect internal controls subsequent to the date
                  of  our  most  recent  evaluation,  including  any  corrective
                  actions with regard to significant  deficiencies  and material
                  weaknesses.


                                    CAPITAL REALTY INVESTORS-II
                                      LIMITED PARTNERSHIP
                                    --------------------------------------------
                                    (Issuer)

                                    by:  C.R.I., Inc.
                                         ---------------------------------------
                                         Managing General Partner



May 6, 2003                              by:  /s/ William B. Dockser
-----------                                   ----------------------------------
DATE                                          William B. Dockser,
                                                Director, Chairman of the Board,
                                                and Treasurer
                                                (Principal Executive Officer)


     This  certification  is made solely for purpose of 18 U.S.C.  Section 1350,
subject  to the  knowledge  standard  contained  therein,  and not for any other
purpose.



                                      -18-