<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-K

                Annual Report Pursuant to Section 13 or 15(d) of

                       the Securities Exchange Act of 1934

                   For the Fiscal Year Ended DECEMBER 31, 2001

                             Commission File Number

                                     0-09262

                         REAL ESTATE ASSOCIATES LIMITED

                        A CALIFORNIA LIMITED PARTNERSHIP

                  I.R.S. Employer Identification No. 95-3187912

       9090 WILSHIRE BOULEVARD, SUITE 201, BEVERLY HILLS, CALIFORNIA 90211
        Registrant's Telephone Number, Including Area Code (310) 278-2191
      Securities Registered Pursuant to Section 12(b) or 12(g) of the Act:

                                      NONE

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

                     Yes  X     No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]

<PAGE>

PART I.

ITEM 1.    BUSINESS:

Real Estate Associates Limited ("REAL" or the "Partnership") is a limited
partnership which was formed under the laws of the State of California on
September 15, 1977. On October 27, 1978, REAL offered 16,500 Limited Partnership
Interests through a public offering managed by E.F. Hutton Inc.

The general partners of Real Estate Associates Limited are Charles H. Boxenbaum,
an individual residing in California, and National Partnership Investments Corp.
("NAPICO"), a California Corporation (the Corporate General Partner). The
business of REAL is conducted primarily by NAPICO.

Prior to December 30, 1998, NAPICO was a wholly owned subsidiary of Casden
Investment Corporation ("CIC"), which is wholly owned by Alan I. Casden. On
December 30, 1998, Casden Properties Operating Partnership, L.P. (the "Operating
Partnership"), a majority owned subsidiary of Casden Properties Inc., a real
estate investment trust organized by Alan I. Casden, purchased a 95.25% economic
interest in NAPICO. The current members of NAPICO's Board of Directors are
Charles H. Boxenbaum, Bruce E. Nelson and Alan I. Casden.

On December 3, 2001, Casden Properties Inc., entered into a merger agreement and
certain other transaction documents with Apartment Investment and Management
Company, a Maryland corporation ("AIMCO") and certain of its subsidiaries,
pursuant to which, on March 11, 2002, AIMCO acquired Casden Properties Inc. and
its subsidiaries, including NAPICO.

REAL holds limited partnership interests in 9 local limited partnerships as of
December 31, 2001, after selling its interests in 9 local limited partnerships
to the Operating Partnership in December 1998 and after having its interest in
one local limited partnership redeemed on September 30, 1998. Each of these
limited partnerships owns a low income housing project which is subsidized
and/or has a mortgage note payable to or insured by agencies of the federal or
local government.

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

Under recently adopted law and policy, the United States Department of Housing
and Urban Development ("HUD") has determined not to renew the Housing Assistance
Payment ("HAP") Contracts on a long term basis on the existing terms. In
connection with renewals of the HAP Contracts under such new law and policy, the
amount of rental assistance payments under renewed HAP Contracts will be based
on market rentals instead of above market rentals, which may be the case under
existing HAP Contracts. The payments under the renewed HAP Contracts may not be
in an amount that would provide sufficient cash flow to permit owners of
properties subject to HAP Contracts to meet the debt service requirements of
existing loans insured by the Federal Housing Administration of HUD ("FHA")
unless such mortgage loans are restructured. In order to address the reduction
in payments under HAP Contracts as a result of this new policy, the Multi-family
Assisted Housing Reform and Affordability Act of 1997 ("MAHRAA") provides for
the restructuring of mortgage loans insured by the FHA with respect to
properties subject to the Section

<PAGE>

8 program. Under MAHRAA, an FHA-insured mortgage loan can be restructured into a
first mortgage loan which will be amortized on a current basis and a low
interest second mortgage loan payable to FHA which will only be payable on
maturity of the first mortgage loan. This restructuring results in a reduction
in annual debt service payable by the owner of the FHA-insured mortgage loan and
is expected to result in an insurance payment from FHA to the holder of the
FHA-insured loan due to the reduction in the principal amount. MAHRAA also
phases out project-based subsidies on selected properties serving families not
located in rental markets with limited supply, converting such subsidies to a
tenant-based subsidy.

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

The partnerships in which REAL has invested were, at least initially, organized
by private developers who acquired the sites, or options thereon, and applied
for applicable mortgage insurance and subsidies. REAL became the principal
limited partner in these local limited partnerships pursuant to arm's-length
negotiations with these developers, or others, who acted as general partners. As
a limited partner, REAL's liability for obligations of the local limited
partnership is limited to its investment. The local general partner of the local
limited partnership retains responsibility for developing, constructing,
maintaining, operating and managing the project. Under certain circumstances of
default, REAL has the right to replace the general partner of the local limited
partnerships, but otherwise does not have control of sale or refinancing, etc.

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

<PAGE>

During 2001, all of the projects in which REAL had invested were substantially
rented. The following is a schedule of the status as of December 31, 2001, of
the projects owned by local limited partnerships in which REAL is a limited
partner.

            SCHEDULE OF PROJECTS OWNED BY LOCAL LIMITED PARTNERSHIPS
                         IN WHICH REAL HAS AN INVESTMENT
                                DECEMBER 31, 2001

<TABLE>
<CAPTION>
                                                            Units Authorized
                                                               For Rental
                                                            Assistance Under
                                                              Section 8 or
                                                               Other Rent                            Percentage of
                                           No. of              Supplement             Units           Total Units
Name and Location                           Units                Program            Occupied           Occupied
-----------------                          -------            ------------         ----------         ----------
<S>                                        <C>              <C>                    <C>               <C>
Belleville Manor                             32                   32/  0               32                100%
Marion, KY

Bethel Towers                               146                   53/  0              142                 97%
Detroit, MI

Cherry Hill Place                           186                  186/  0              186                100%
Inkster, MI

Clinton Apts.                                24                   24/  0               22                 92%
Clinton, KY

Northwood Village                            72                   72/  0               68                 94%
Emporia, VA

Ridgeview Estates                            32                    0/ 32               23                 72%
Lewisburg, W. VA.

Wedgewood Village                            32                    0/ 32               32                100%
Ripley, W. VA

W. Lafayette Apts.                           49                   49/  0               48                 98%
W. Lafayette, OH

Williamson Towers                            76                   76/  0               75                 99%
Williamson, W. VA
                                         ------                 --------             ----
                                            649                   492/64              628                 97%
                                         ======                 ========             ====
</TABLE>

<PAGE>

ITEM 2.        PROPERTIES:

The local limited partnerships in which REAL holds interests own various
multi-family rental properties. See Item 1 for information pertaining to these
properties.

ITEM 3.        LEGAL PROCEEDINGS:

CLASS ACTION

On August 27, 1998, two investors holding an aggregate of eight units of limited
partnership interests in Real Estate Associates Limited III (a partnership in
which NAPICO is a general partner) and two investors holding an aggregate of
five units of limited partnership interest in Real Estate Associates Limited VI
(another partnership in which Company is a general partner) commenced an action
in the United States District Court for the Central District of California on
behalf of themselves and all other similarly situated, against the Partnership,
NAPICO and certain other affiliated entities. The complaint alleges that the
defendants breached their fiduciary duty to the limited partners of such Funds
and made materially false and misleading statements in the consent solicitation
statements that were disseminated to the limited partners of such Funds relating
to approval of the transfer of partnership interests in limited partnerships to
the Operating Partnership. The plaintiffs seek preliminary and permanent
injunction relief and other equitable relief, as well as compensatory and
punitive damages. However, plaintiffs made no effort to enjoin the transaction
from taking place. On August 4, 1999, a holder of one unit of limited
partnership interest in Housing Programs Limited (a partnership in which the
Company is a general partner) filed a lawsuit similar to the one discussed above
against added Housing Programs Limited. The second action has been subsumed in
the first action, which has been certified as a class action.

After defendants moved for summary disposition of the action, plaintiffs filed a
motion for leave to file an amended complaint. Although defendants opposed the
filing of the complaint proposed by plaintiffs, the court issued an order on
July 20, 2001 granting plaintiffs leave to amend but denying them leave to file
the complaint they proposed. Plaintiffs filed a Second, Restated, Amended and
Supplemental Complaint dated August 7, 2001 and on August 21, 2001 filed a
Corrected Second, Restated, Amended and Supplemental Complaint (CSRASC). The
CSRASC adds eight new defendants and six new counts which were not included in
prior complaints. The new counts include; (i) violations of the anti-bundling
rules of the Securities and Exchange Act of 1934, (ii) violation of the doctrine
of inherent fairness, (iii) a declaratory judgment that the certain defendants
are not entitled to indemnification under the partnership agreements, (iv)
rescission of the business combination discussed in Note 1, (v) a constructive
trust on any recovery from a separate lawsuit pending in the United States
District Court of the Middle District of Pennsylvania which was brought on
behalf of several limited partnerships which are not parties to this action; and
(vi) an accounting. Defendants made a motion to dismiss the CSRASC, which was
denied. The court found that the issues presented would be more appropriate
resolved in a motion for summary judgment or summary adjudication. Defendants
intend to make such a motion. The deadline to do so is April 1, 2002.

Defendants denied allegations in the CSRASC in their answer. The parties are in
the process of conducting discovery. The discovery deadline is February 28, 2002
and the trial is scheduled for July 16, 2002. A motion is before the court to
extend these deadlines and the hearing on that issue is scheduled for February
4, 2002. Once discovery is complete, defendants will move for summary judgement
dismissing the complaint.

OTHER

Plaintiff, who is a limited partner in the Partnership, claims that NAPICO and
other defendants (1) have refused to provide the plaintiff with access to the
books and records of the Partnership, and (2) have breached their fiduciary
duties and the partnership agreement by failing to provide such access and by
failing to act in the best interest of the Partnership. The defendants have,
however, provided their books and records to plaintiff

<PAGE>

pursuant to a protective order. Plaintiff has failed to quantify its purported
damages. Trial is schedule for August 13, 2002.

The managing general partner of such NAPICO managed partnerships and the other
defendants believe that the plaintiffs' claims are without merit and intend to
contest the actions vigorously.

The corporate general partner of the Partnership is a plaintiff in various
lawsuits and has also been named a defendant in other lawsuits arising from
transactions in the ordinary course of business. None of these suits were
related to REAL.

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

In August 1998, a consent solicitation statement was sent to the limited
partners setting forth the terms and conditions of the purchase of the limited
partners' interests, held for investment by the Partnership, by the Operating
Partnership, together with certain amendments to the Partnership Agreement and
other disclosures of various conflicts of interest in connection with the
proposed transaction. Prior to the sale of the partnership interests in 1998,
the consents of the limited partners to the sale and amendments to the
Partnership Agreement were obtained.

PART II.

ITEM 5.        MARKET FOR THE REGISTRANT'S PARTNERSHIP INTERESTS AND RELATED
               SECURITY HOLDER MATTERS:

The Limited Partnership Interests are not traded on a public exchange but were
sold through a public offering managed by E.F. Hutton Inc. It is not anticipated
that any public market will develop for the purchase and sale of any partnership
interest. Limited Partnership Interests may be transferred only if certain
requirements are satisfied. At December 31, 2001, there were 1,094 registered
holders of units in REAL. The Partnership has invested in certain government
assisted projects under programs which in many instances restrict the cash
return available to project owners. The Partnership was not designed to provide
cash distributions to investors in circumstances other than refinancing or
disposition of its investments in limited partnerships. In March 1999, the
Partnership made distributions of $3,861,000 to the limited partners and $39,000
to the general partners, primarily using proceeds from the sale of the
partnership interests. No other distributions have been made since the inception
of the Partnership.

<PAGE>

ITEM 6.   SELECTED FINANCIAL DATA:


<TABLE>
<CAPTION>
                                                               Year Ended December 31,
                                  -------------------------------------------------------------------------------
                                      2001             2000             1999             1998             1997
                                  -----------      -----------      -----------      -----------      -----------
<S>                               <C>              <C>              <C>              <C>              <C>
Loss from Operations              $  (240,906)     $  (228,061)     $  (269,214)     $  (788,370)     $  (622,278)

Gain on sale of limited
    partnership interests                --               --               --          3,798,734             --

Distributions from Limited
   Partnerships Recognized
   as Income                            8,580           50,774            9,481          997,836          587,078

Equity in (Loss) Income of
   Limited Partnerships
   and Amortization of
   Acquisition Costs                   (7,092)          94,117           41,704         (747,873)        (204,940)
                                  -----------      -----------      -----------      -----------      -----------
Net (Loss) Income                 $  (239,418)     $   (83,170)     $  (218,029)     $ 3,260,327      $  (240,140)
                                  ===========      ===========      ===========      ===========      ===========
Net (Loss) Income per limited
   Partnership Interest           $       (15)     $        (5)     $       (13)     $       196      $       (14)
                                  ===========      ===========      ===========      ===========      ===========

Total assets                      $   659,018      $   687,018      $   782,893      $ 4,970,809      $ 1,864,839
                                  ===========      ===========      ===========      ===========      ===========
Investments in Limited
   Partnerships                   $   658,626      $   661,411      $   579,027      $   530,241      $ 1,319,976
                                  ===========      ===========      ===========      ===========      ===========
Accrued Fees and Expenses
   Due General Partner            $    93,531      $      --        $      --        $      --        $   181,333
                                  ===========      ===========      ===========      ===========      ===========
</TABLE>

<PAGE>

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

LIQUIDITY

The Partnership's primary sources of funds include interest income on money
market accounts and certificates of deposit and distributions from local
partnerships in which the Partnership has invested. It is not expected that any
of the local limited partnerships in which the Partnership has invested will
generate cash flow sufficient to provide for distributions to the Partnership's
limited partners in any material amount. The Partnership made a cash
distribution to investors in March 1999, primarily using proceeds from the
disposition of its investments in certain limited partnerships.

CAPITAL RESOURCES

REAL received $16,500,000 in subscriptions for units of Limited Partnership
Interests (at $1,000 per unit) during the period October 27, 1978 through August
31, 1979 pursuant to a registration statement on Form S-11.

RESULTS OF OPERATIONS

The Partnership was formed to provide various benefits to its partners as
discussed in Item 1.

At December 31, 2001, the Partnership had investments in 9 limited partnerships,
all of which own housing projects that were substantially all rented. The
Partnership sold its interests in 8 local partnerships in December 1998 and had
its interest in one local partnership redeemed in September 30, 1998. The
Partnership, as a limited partner, is entitled to 50% to 99% of the profits and
losses of the local limited partnerships. The Partnership accounts for its
investments in the local limited partnerships on the equity method, thereby
adjusting its investment balance by its proportionate share of the income or
loss of the local limited partnerships. Equity in losses of limited partnerships
are recognized in the financial statements until the limited partnership
investment account is reduced to a zero balance. Losses incurred after the
limited partnership investment account is reduced to zero are not recognized.
Limited partners are not liable for losses beyond their contributed capital. At
December 31, 2001 and 2000, the Partnership has a positive investment balance in
only one local limited partnership.

Distributions received from limited partnerships are recognized as return of
capital until the investment balance has been reduced to zero or to a negative
amount equal to future capital contributions required. Subsequent distributions
received are recognized as income.

The total income from the local limited partnerships that was allocated to the
Partnership was $2,000, $71,000 and $227,000 for the years ended December 31,
2001, 2000 and 1999, respectively. However, because losses incurred after the
investment account is reduced to a zero balance are not recognized and
subsequent income is not recognized until the investment account becomes
positive again, the Partnership recognized equity in (loss) income of limited
partnerships, of $(7,092), $94,117 and $41,704 for the years ended December 31,
2001, 2000 and 1999, respectively. The cumulative amount of the unrecognized
equity in losses of certain limited partnerships was approximately $3,735,000
and $3,542,000 as of December 31, 2001 and 2000, respectively.

<PAGE>

Distributions from the local limited partnerships in which the Partnership did
not have a positive investment balance were $8,580, $50,774 and $9,481 for the
years ended December 31, 2001, 2000 and 1999, respectively. These amounts were
recognized as income on the accompanying statements of operations, in accordance
with the equity method of accounting.

As of December 31, 2001, 2000 and 1999, the Partnership has cash and cash
equivalents of $392, $2,511 and $203,866, respectively. Substantially all of
these amounts are on deposit primarily with high credit quality financial
institutions, earning interest. This resulted in the Partnership earning $350,
$5,521 and $16,080 in interest income for the years ended December 31, 2001,
2000 and 1999, respectively. The amount of interest income varies with market
rates available on deposits and with the amount of funds available for
investment. Cash equivalents can be converted to cash to meet obligations of the
Partnership as they arise. The Partnership intends to continue investing
available funds in this manner.

A recurring partnership expense is the annual management fee. The fee is payable
to the Corporate General Partner of the Partnership and is calculated at .5
percent of the Partnership's original remaining invested assets. The management
fee is paid to the Corporate General Partner for its continuing management of
partnership affairs. The fee is payable beginning with the month following the
Partnership's initial investment in a local limited partnership. Management fees
were $106,212, $106,207 and $106,232 for 2001, 2000 and 1999, respectively. As
of December 31, 2001, the fees and expenses due the Corporate General Partner
exceeded the Partnership's cash. The Corporate General Partner, during the
forthcoming year, will not demand payment of amounts due in excess of such cash
or such that the Partnership would not have sufficient operating cash; however,
the Partnership will remain liable for all such amounts.

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

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

As a result of the foregoing, the Partnership, in 1997, commenced an extensive
review of disposition, refinancing or re-engineering alternatives for the
properties in which the limited partnerships have invested and are subject to
HUD mortgage and rental subsidy programs. The Partnership has incurred expenses
in connection with this review by various third party professionals, including
accounting, legal, valuation,

<PAGE>

structural and engineering costs, which amounted to $70,788 for the year ended
December 31, 1999, and are included in administrative expenses.

On December 30, 1998, the Partnership sold its limited partnership interests in
8 local limited partnerships to the Operating Partnership. The sale resulted in
cash proceeds to the Partnership of $3,900,000 and a net gain of $3,798,734,
after deducting selling costs. The cash proceeds were held in escrow at December
31, 1998 and were collected in 1999. In March 1999, the Partnership made cash
distributions of $3,861,000 to the limited partners and $39,000 to the general
partners, primarily using proceeds from the sale of the partnership interests.

The Operating Partnership purchased such limited partner interests for cash,
which it raised in connection with a private placement of its equity securities.
The purchase was subject to, among other things, (i) the purchase of the general
partner interests in the local limited partnerships by the REIT; (ii) the
approval of HUD and certain state housing finance agencies; and (iii) the
consent of the limited partners to the sale of the local limited partnership
interests held for investment by the Partnership.

In August 1998, a consent solicitation statement was sent to the limited
partners setting forth the terms and conditions of the purchase of the limited
partners' interests held for investment by the Partnership, together with
certain amendments to the Partnership Agreement and other disclosures of various
conflicts of interest in connection with the proposed transaction. Prior to the
sale of the partnership interests, the consents of the limited partners to the
sale and amendments to the Partnership Agreement were obtained.

Operating expenses, other than management fees, consist of legal and accounting
fees for services rendered to the Partnership and administrative expenses. Legal
and accounting fees were generally consistent and were $89,251, $88,746 and
$66,438 for the years ended December 31, 2001, 2000 and 1999, respectively.
Administrative expenses were $45,793, $38,629 and $112,624 for the years ended
December 31, 2001, 1999 and 1998, respectively. Included in administrative
expenses are reimbursements to NAPICO for certain expenses, which totaled
$9,360, $6,760 and $3,300 for the years ended December 31, 2001, 2000 and 1999,
respectively. In addition, included in administrative expenses in 1999 is
$70,788, in expenses, related to the aforementioned third-party review of the
properties owned by the local partnerships.

Total revenue for the local partnerships were $4,046,000, $4,058,000 and
$4,174,000 for the years ended December 31, 2001, 2000 and 1999, respectively.

Total expenses for the local partnerships were $4,056,000, $3,994,000 and
$3,951,000 for the years ended December 31, 2001, 2000 and 1999, respectively.

The total net (loss) income for the local partnerships for 2001, 2000 and 1999
aggregated $(10,000), $64,000, $223,000, respectively. The (loss) income
allocated to the Partnership was $(192,000), $71,000 and $227,000 for
2001, 2000 and 1999, respectively.

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

ITEM 7A.       QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

<PAGE>

ITEM 8.        FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA:

The Financial Statements and Supplementary Data are listed under Item 14.


ITEM 9.        CHANGES WITH AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
               FINANCIAL DISCLOSURE:

Not applicable.

<PAGE>


                         REAL ESTATE ASSOCIATES LIMITED
                       (A California limited partnership)

                              FINANCIAL STATEMENTS,
                          FINANCIAL STATEMENT SCHEDULES
                   AND INDEPENDENT PUBLIC ACCOUNTANTS' REPORT
                                DECEMBER 31, 2001

<PAGE>

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Partners of
Real Estate Associates Limited
(A California limited partnership)

We have audited the accompanying balance sheets of Real Estate Associates
Limited (a California limited partnership) as of December 31, 2001 and 2000, and
the related statements of operations, partners' equity (deficiency) and cash
flows for each of the three years in the period ended December 31, 2001. Our
audits also included the financial statement schedules listed in the index in
item 14. These financial statements and financial statement schedules are the
responsibility of the management of the Partnership. Our responsibility is to
express an opinion on these financial statements and financial statement
schedules based on our audits. We did not audit the financial statements of
certain limited partnerships, the investments in which are reflected in the
accompanying financial statements using the equity method of accounting. These
limited partnerships represent a substantial portion of the investee information
in Note 2 and the financial statement schedules. The financial statements of
these limited partnerships were audited by other auditors. Their reports have
been furnished to us and our opinion, insofar as it relates to the amounts
included for these limited partnerships, is based solely on the reports of the
other auditors.

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

In our opinion, based on our audits and the reports of other auditors, the
financial statements referred to above present fairly, in all material respects,
the financial position of Real Estate Associates Limited as of December 31, 2001
and 2000, and the results of its operations and its cash flows for each of the
three years in the period ended December 31, 2001 in conformity with accounting
principles generally accepted in the United States of America. Also, in our
opinion, based on our audits and the reports of other auditors, such financial
statement schedules, when considered in relation to the basic financial
statements taken as a whole, present fairly in all material respects the
information set forth therein.

DELOITTE & TOUCHE LLP

Los Angeles, California
March 22, 2002


<PAGE>

                         REAL ESTATE ASSOCIATES LIMITED
                       (a California limited partnership)

                                 BALANCE SHEETS
                           DECEMBER 31, 2001 AND 2000

                                     ASSETS

<TABLE>
<CAPTION>
                                                                      2001           2000
                                                                   ---------      ---------
<S>                                                                <C>            <C>
INVESTMENTS IN LIMITED PARTNERSHIPS (Note 2)                       $ 658,626      $ 661,411

CASH AND CASH EQUIVALENTS (Note 1)                                       392          2,511

DUE FROM NAPICO (Note 3)                                                --           23,096
                                                                   ---------      ---------

          TOTAL ASSETS                                             $ 659,018      $ 687,018
                                                                   =========      =========

                        LIABILITIES AND PARTNERS' EQUITY

LIABILITIES:
     Accrued fees and expenses due general partner                 $  93,531      $    --
     Accounts payable                                                151,550         33,663
                                                                   ---------      ---------
                                                                     245,081         33,663

COMMITMENTS AND CONTINGENCIES (Notes 3 and 4)

PARTNERS' EQUITY (DEFICIENCY):
    General partners                                                (122,930)      (120,536)
    Limited partners                                                 536,867        773,891
                                                                   ---------      ---------
                                                                     413,937        653,355
                                                                   ---------      ---------
           TOTAL LIABILITIES AND PARTNERS' EQUITY                  $ 659,018      $ 687,018
                                                                   =========      =========
</TABLE>


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


                                        2

<PAGE>

                         REAL ESTATE ASSOCIATES LIMITED
                       (a California limited partnership)

                            STATEMENTS OF OPERATIONS

              FOR THE YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999

<TABLE>
<CAPTION>
                                                        2001           2000           1999
                                                     ---------      ---------      ---------
<S>                                                  <C>            <C>            <C>
INTEREST AND OTHER INCOME                            $     350      $   5,521      $  16,080
                                                     ---------      ---------      ---------

OPERATING EXPENSES:
      Legal and accounting                              89,251         88,746         66,438
      Management fees - general partner (Note 3)       106,212        106,207        106,232
      Administrative  (Note 3)                          45,793         38,629        112,624
                                                     ---------      ---------      ---------
TOTAL OPERATING EXPENSES                               241,256        233,582        285,294
                                                     ---------      ---------      ---------

LOSS FROM OPERATIONS                                  (240,906)      (228,061)      (269,214)

DISTRIBUTIONS FROM LIMITED
      PARTNERSHIPS RECOGNIZED AS
      INCOME (Note 2)                                    8,580         50,774          9,481

EQUITY IN (LOSS) INCOME OF LIMITED
      PARTNERSHIPS AND AMORTIZATION
      OF ACQUISITION COSTS (Note 2)                     (7,092)        94,117         41,704
                                                     ---------      ---------      ---------
NET LOSS                                             $(239,418)     $ (83,170)     $(218,029)
                                                     =========      =========      =========
NET LOSS PER LIMITED
      PARTNERSHIP INTEREST (Note 1)                  $     (15)     $      (5)     $     (13)
                                                     =========      =========      =========
</TABLE>


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


                                        3
<PAGE>

                         REAL ESTATE ASSOCIATES LIMITED
                       (a California limited partnership)

                   STATEMENTS OF PARTNERS' EQUITY (DEFICIENCY)
              FOR THE YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999


<TABLE>
<CAPTION>
                             General        Limited
                            Partners        Partners           Total
                          -----------      -----------      ----------
<S>                       <C>              <C>              <C>
EQUITY (DEFICIENCY),
   January 1, 1999        $   (78,524)     $ 4,933,078      $ 4,854,554

    Distributions             (39,000)      (3,861,000)      (3,900,000)

    Net loss for 1999          (2,180)        (215,849)        (218,029)
                          -----------      -----------      -----------

EQUITY (DEFICIENCY),
    December 31, 1999        (119,704)         856,229          736,525

    Net loss for 2000            (832)         (82,338)         (83,170)
                          -----------      -----------      -----------

EQUITY (DEFICIENCY),
    December 31, 2000        (120,536)         773,891          653,355

    Net loss for 2001          (2,394)        (237,024)        (239,418)
                          -----------      -----------      -----------

EQUITY (DEFICIENCY),
    December 31, 2001     $  (122,930)     $   536,867      $   413,937
                          ===========      ===========      ===========
</TABLE>


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


                                        4
<PAGE>

                         REAL ESTATE ASSOCIATES LIMITED
                       (a California limited partnership)

                            STATEMENTS OF CASH FLOWS
              FOR THE YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999

<TABLE>
<CAPTION>
                                                                       2001             2000             1999
                                                                  -----------      -----------      -----------
<S>                                                               <C>              <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
       Net loss                                                   $  (239,418)     $   (83,170)     $  (218,029)
       Adjustments to reconcile net loss to net
         cash provided by (used in) operating activities:
           Equity in loss (income) of limited partnerships
                and amortization of acquisition costs                   7,092          (94,117)         (41,704)
            Decrease (increase) in due from general partner            23,096          (23,096)            --
            Increase in accrued fees
               and expenses due general partner                        93,531             --               --
            Increase (decrease) in accounts payable                   117,887          (12,705)         (69,887)
                                                                  -----------      -----------      -----------
                Net cash provided by (used in) operating
                   activities                                           2,188         (213,088)        (329,620)
                                                                  -----------      -----------      -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
       Distributions from limited partnership
           recognized as return of capital                             40,045           35,733           37,918
       Capital contribution to limited partnerships                   (44,352)         (24,000)         (45,000)
       Proceed from the sale of limited partnership interests            --               --          3,900,000
                                                                  -----------      -----------      -----------
                 Net cash provided by investing activities             (4,307)          11,733        3,892,918
                                                                  -----------      -----------      -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
       Distributions to partners                                         --               --         (3,900,000)
                                                                  -----------      -----------      -----------

NET DECREASE IN CASH AND CASH EQUIVALENTS                              (2,119)        (201,355)        (336,702)

CASH AND CASH EQUIVALENTS,
       BEGINNING OF YEAR                                                2,511          203,866          540,568
                                                                  -----------      -----------      -----------
CASH AND CASH EQUIVALENTS,
       END OF YEAR                                                $       392      $     2,511      $   203,866
                                                                  ===========      ===========      ===========
</TABLE>


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


                                        5
<PAGE>

                         REAL ESTATE ASSOCIATES LIMITED
                       (a California limited partnership)

                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2001

1.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

        Organization

        Real Estate Associates Limited (the "Partnership") was formed under the
        California Limited Partnership Act on September 15, 1977. The
        Partnership was formed to invest in other limited partnerships which own
        and operate primarily federal, state and local government-assisted
        housing projects. The general partners are National Partnership
        Investments Corp. (NAPICO), the Corporate General Partner, and Charles
        H. Boxenbaum, Chief Executive Officer of NAPICO. The business of the
        Partnership is conducted primarily by NAPICO.

        Prior to December 30, 1998, NAPICO was a wholly owned subsidiary of
        Casden Investment Corporation ("CIC"), which is wholly owned by Alan I.
        Casden. On December 30, 1998, Casden Properties Operating Partnership,
        L.P. (the "Operating Partnership"), a majority owned subsidiary of
        Casden Properties Inc., a real estate investment trust organized by Alan
        I. Casden, purchased a 95.25% economic interest in NAPICO. The remaining
        economic interest, including a majority of the voting common stock,
        continues to be owned by CIC.

        On December 3, 2001, Casden Properties Inc., entered into a merger
        agreement and certain other transaction documents with Apartment
        Investment and Management Company, a Maryland corporation ("AIMCO") and
        certain of its subsidiaries, pursuant to which, on March 11, 2002, AIMCO
        acquired Casden Properties Inc. and its subsidiaries, including NAPICO.

        The Partnership issued 16,505 units of limited partnership interests
        through a public offering. The general partners have a 1 percent
        interest in the profits and losses of the Partnership. The limited
        partners have the remaining 99 percent interest which is allocated in
        proportion to their respective individual investments.

        The Partnership shall be dissolved only upon the expiration of 53
        complete calendar years (December 31, 2031) from the date of the
        formation of the Partnership or the occurrence of various other events
        as specified in the terms of the Partnership agreement.

        Upon total or partial liquidation of the Partnership or the disposition
        or partial disposition of a project or project interest and distribution
        of the proceeds, the general partners will be entitled to a liquidation
        fee as stipulated in the Partnership agreement. The limited partners


                                       6
<PAGE>

                         REAL ESTATE ASSOCIATES LIMITED
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 2001

1.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

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

        Basis of Presentation

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

        Recent Accounting Pronouncements

        In July 2001, the Financial Accounting Standards Board issued Statement
        of Financial Accounting Standards Number (SFAS No.) 141, "Business
        Combinations" and SFAS No. 142, "Goodwill and Other Intangible Assets."
        SFAS No. 141 was effective immediately and SFAS 142 will be effective
        January 2002. The new standards are not expected to have a significant
        impact on the Partnership's financial statements.

        Use of Estimates

        The preparation of financial statements in conformity with accounting
        principles generally accepted in the United States of America 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 reported
        amounts of revenues and expenses during the reporting period. Actual
        results could differ from those estimates.

        Method of Accounting for Investments in Limited Partnerships

        The investments in limited partnerships are accounted for on the equity
        method. Acquisition, selection and other costs related to the
        acquisition of the projects are capitalized to the investment account
        and are being amortized on a straight line basis over the estimated
        lives of the underlying assets, which is generally 30 years.


                                       7
<PAGE>

                         REAL ESTATE ASSOCIATES LIMITED
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 2001

1.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

        Net Loss Per Limited Partnership Interest

        Net loss per limited partnership interest was computed by dividing the
        limited partners' share of net loss by the number of limited partnership
        interests outstanding during the year. The number of limited partnership
        interests was 16,505 for all years presented.

        Cash and Cash Equivalents

        Cash and cash equivalents consist of cash and bank certificates of
        deposit with an original maturity of three months or less. The
        Partnership has its cash and cash equivalents on deposit with high
        credit quality financial institutions. Such cash and cash equivalents
        are in excess of the FDIC insurance limit.

        Impairment of Long-Lived Assets

        The Partnership reviews long-lived assets to determine if there has been
        any permanent impairment whenever events or changes in circumstances
        indicate that the carrying amount of the asset may not be recoverable.
        If the sum of the expected future cash flows is less than the carrying
        amount of the assets, the Partnership recognizes an impairment loss.
        During 1998, the Partnership recognized an impairment loss of
        approximately $898,000, related to certain investments in local limited
        partnerships, which has been included in equity in loss of limited
        partnerships.

2.      INVESTMENTS IN LIMITED PARTNERSHIPS

        The Partnership holds limited partnership interests in 9 limited
        partnerships as of December 31, 2001 and 2000, after selling its
        interests in 8 limited partnerships and having its interest in one
        limited partnership redeemed in 1998. The limited partnerships own
        residential low income rental projects consisting of 649 apartment
        units. The mortgage loans of these projects are payable to or insured by
        various governmental agencies.

        The Partnership, as a limited partner, is entitled to between 50 percent
        and 99 percent of the profits and losses in the limited partnerships.

        Equity in losses of limited partnerships are recognized in the financial
        statements until the limited partnership investment account is reduced
        to a zero balance. Losses incurred after the


                                       8
<PAGE>

                         REAL ESTATE ASSOCIATES LIMITED
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 2001

2.      INVESTMENTS IN LIMITED PARTNERSHIPS (CONTINUED)

        limited partnership investment account is reduced to zero are not
        recognized. The cumulative amount of the unrecognized equity in losses
        of certain limited partnerships was in the aggregate approximately
        $3,735,000 and $3,542,000 as of December 31, 2001 and 2000,
        respectively.

        Distributions from the limited partnerships are accounted for as a
        return of capital until the investment balance is reduced to zero.
        Subsequent distributions received are recognized as income.

        The following is a summary of the investments in limited partnerships
        and reconciliation to the limited partnership accounts:

<TABLE>
<CAPTION>
                                                              2001           2000
                                                           ---------      ---------
<S>                                                        <C>            <C>
Investment balance, beginning of year                      $ 661,411      $ 579,027
Capital contribution                                          44,352         24,000
Equity in (loss) income of limited partnerships               (4,307)        96,903
Amortization of capitalized acquisition costs and fees        (2,785)        (2,786)
Cash distributions recognized as return of capital           (40,045)       (35,733)
                                                           ---------      ---------
Investment balance, end of year                            $ 658,626      $ 661,411
                                                           =========      =========
</TABLE>

        The difference between the investment per the accompanying balance
        sheets at December 31, 2001 and 2000, and the deficiency per the limited
        partnerships' combined financial statements is due primarily to
        cumulative unrecognized equity in losses of certain limited
        partnerships, costs capitalized to the investment account, cumulative
        distributions recognized as income and recognition of impairment losses.


                                       9
<PAGE>

                         REAL ESTATE ASSOCIATES LIMITED
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 2001


2.      INVESTMENTS IN LIMITED PARTNERSHIPS (CONTINUED)

        Selected financial information from the combined financial statements of
        the limited partnerships, at December 31, 2001 and 2000 and for each of
        the three years in the period ended December 31, 2001 is as follows:

                                 Balance Sheets

<TABLE>
<CAPTION>
                                                       2001          2000
                                                     --------      --------
                                                         (in thousands)
<S>                                                  <C>           <C>
Land and buildings, net                              $  6,479      $  6,972
                                                     ========      ========
Total assets                                         $ 10,274      $ 10,880
                                                     ========      ========
Mortgages payable                                    $ 13,619      $ 14,289
                                                     ========      ========
Total liabilities                                    $ 14,850      $ 15,366
                                                     ========      ========
Deficiency of Real Estate Associates Limited         $ (3,556)     $ (3,362)
                                                     ========      ========
Deficiency of other partners                         $ (1,020)     $ (1,124)
                                                     ========      ========
</TABLE>

                            Statements of Operations

<TABLE>
<CAPTION>
                                                         2001         2000        1999
                                                        -------      -------     -------
                                                                  (in thousands)
<S>                                                     <C>          <C>         <C>
Total revenues                                          $ 4,046      $ 4,058     $ 4,174
                                                        =======      =======     =======
Interest expense                                        $   783      $   847     $   887
                                                        =======      =======     =======
Depreciation and amortization                           $   774      $   783     $   758
                                                        =======      =======     =======
Total expenses                                          $ 4,056      $ 3,994     $ 3,951
                                                        =======      =======     =======
Net (loss) income                                       $   (10)     $    64     $   223
                                                        =======      =======     =======
Net (loss) income allocable to the Partnership          $  (192)     $    71     $   227
                                                        =======      =======     =======
</TABLE>


                                       10
<PAGE>

                         REAL ESTATE ASSOCIATES LIMITED
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 2001

2.      INVESTMENTS IN LIMITED PARTNERSHIPS (CONTINUED)

        An affiliate of NAPICO is the general partner in three of the limited
        partnerships included above, and another affiliate receives property
        management fees of 5 percent of its revenues. The affiliate received
        property management fees of $11,339, $6,127 and $6,975 in 2001, 2000 and
        1999, respectively. The following sets forth significant data for this
        partnership, reflected in the accompanying financial statements using
        the equity method of accounting:

<TABLE>
<CAPTION>
                                                       2001         2000        1999
                                                      -------      -------     -------
                                                               (in thousands)
<S>                                                   <C>          <C>         <C>
 Total assets                                         $   734      $   780
                                                      =======     =======
 Total liabilities                                    $ 2,774      $ 2,739
                                                      =======     =======
 Deficiency of Real Estate Associates Limited         $(2,085)     $(1,879)
                                                      =======     =======
 Deficiency of other partners                         $    45      $   (80)
                                                      =======     =======
 Total revenue                                        $   425      $   409     $   415
                                                      =======      =======     =======
 Net loss                                             $   (75)     $  (115)    $   (81)
                                                      =======      =======     =======
</TABLE>

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


                                       11
<PAGE>

                         REAL ESTATE ASSOCIATES LIMITED
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 2001

2.      INVESTMENTS IN LIMITED PARTNERSHIPS (CONTINUED)

        annual debt service payable by the owner of the FHA-insured mortgage
        loan and is expected to result in an insurance payment from FHA to the
        holder of the FHA-insured loan due to the reduction in the principal
        amount. MAHRAA also phases out project-based subsidies on selected
        properties serving families not located in rental markets with limited
        supply, converting such subsidies to a tenant-based subsidy.

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

        As a result of the foregoing, the Partnership, in 1997, commenced an
        extensive review of disposition, refinancing or re-engineering
        alternatives for the properties in which the limited partnerships have
        invested and are subject to HUD mortgage and rental subsidy programs.
        The Partnership has incurred expenses in connection with this review by
        various third party professionals, including accounting, legal,
        valuation, structural and engineering costs, which amounted to $70,788
        for the year ended December 31, 1999, and are included in administrative
        expenses.

        On December 30, 1998, the Partnership sold its limited partnership
        interests in 8 local limited partnerships to the Operating Partnership.
        The sale resulted in cash proceeds to the Partnership of $3,900,000 and
        a net gain of $3,798,734, after deducting selling costs. The cash
        proceeds were held in escrow at December 31, 1998 and were collected in
        1999. In March 1999, the Partnership made cash distributions of
        $3,861,000 to the limited partners and $39,000 to the general partners,
        primarily using proceeds from the sale of the partnership interests.

        The Operating Partnership purchased such limited partner interests for
        cash, which it raised in connection with a private placement of its
        equity securities. The purchase was subject to, among other things, (i)
        the purchase of the general partner interests in the local limited
        partnerships by the Operating Partnership; (ii) the approval of HUD and
        certain state housing finance agencies; and (iii) the consent of the
        limited partners to the sale of the local limited partnership interests
        held for investment by the Partnership.

        In August 1998, a consent solicitation statement was sent to the limited
        partners setting forth the terms and conditions of the purchase of the
        limited partners' interests held for investment by the Partnership,
        together with certain amendments to the Partnership Agreement and other


                                       12
<PAGE>

                         REAL ESTATE ASSOCIATES LIMITED
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 2001

2.      INVESTMENTS IN LIMITED PARTNERSHIPS (CONTINUED)

        disclosures of various conflicts of interest in connection with the
        proposed transaction. Prior to the sale of the partnership interests,
        the consents of the limited partners to the sale and amendments to the
        Partnership Agreement were obtained.

3.      FEES AND EXPENSES DUE GENERAL PARTNER

        Under the terms of the Restated Certificate and Agreement of Limited
        Partnership, the Partnership is obligated to NAPICO for an annual
        management fee equal to .5 percent of the original invested assets of
        the remaining limited partnerships. Invested assets is defined as the
        costs of acquiring project interests, including the proportionate amount
        of the mortgage loans related to the Partnership's interest in the
        capital accounts of the respective partnerships.

        The Partnership reimburses NAPICO for certain expenses. The
        reimbursement to NAPICO was $9,360, $6,760 and $3,300 in 2001, 2000 and
        1999, respectively, and is included in administrative expenses.

        As of December 31, 2001, the fees and expenses due the Corporate General
        Partner exceeded the Partnership's cash. The Corporate General Partner,
        during the forthcoming year, will not demand payment of amounts due in
        excess of such cash or such that the Partnership would not have
        sufficient operating cash; however, the Partnership will remain liable
        for all such amounts.

4.      CONTINGENCIES

        CLASS ACTION

        On August 27, 1998, two investors holding an aggregate of eight units of
        limited partnership interests in Real Estate Associates Limited III (a
        partnership in which NAPICO is a general partner) and two investors
        holding an aggregate of five units of limited partnership interest in
        Real Estate Associates Limited VI (another partnership in which Company
        is a general partner) commenced an action in the United States District
        Court for the Central District of California on behalf of themselves and
        all other similarly situated, against the Partnership, NAPICO and
        certain other affiliated entities. The complaint alleges that the
        defendants breached their fiduciary duty to the limited partners of such
        Funds and made materially false and misleading statements in the consent
        solicitation statements that were disseminated to the limited partners
        of such Funds relating to approval of the transfer of partnership
        interests in limited partnerships to the Operating Partnership. The
        plaintiffs seek preliminary and permanent


                                       13
<PAGE>

                         REAL ESTATE ASSOCIATES LIMITED
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 2001

4.      CONTINGENCIES (CONTINUED)

        injunction relief and other equitable relief, as well as compensatory
        and punitive damages. However, plaintiffs made no effort to enjoin the
        transaction from taking place. On August 4, 1999, a holder of one unit
        of limited partnership interest in Housing Programs Limited (a
        partnership in which the Company is a general partner) filed a lawsuit
        similar to the one discussed above against added Housing Programs
        Limited. The second action has been subsumed in the first action, which
        has been certified as a class action.

        After defendants moved for summary disposition of the action, plaintiffs
        filed a motion for leave to file an amended complaint. Although
        defendants opposed the filing of the complaint proposed by plaintiffs,
        the court issued an order on July 20, 2001 granting plaintiffs leave to
        amend but denying them leave to file the complaint they proposed.
        Plaintiffs filed a Second, Restated, Amended and Supplemental Complaint
        dated August 7, 2001 and on August 21, 2001 filed a Corrected Second,
        Restated, Amended and Supplemental Complaint (CSRASC). The CSRASC adds
        eight new defendants and six new counts which were not included in prior
        complaints. The new counts include; (i) violations of the anti-bundling
        rules of the Securities and Exchange Act of 1934, (ii) violation of the
        doctrine of inherent fairness, (iii) a declaratory judgment that the
        certain defendants are not entitled to indemnification under the
        partnership agreements, (iv) rescission of the business combination
        discussed in Note 1, (v) a constructive trust on any recovery from a
        separate lawsuit pending in the United States District Court of the
        Middle District of Pennsylvania which was brought on behalf of several
        limited partnerships which are not parties to this action; and (vi) an
        accounting. Defendants made a motion to dismiss the CSRASC, which was
        denied. The court found that the issues presented would be more
        appropriate resolved in a motion for summary judgment or summary
        adjudication. Defendants intend to make such a motion. The deadline to
        do so is April 1, 2002.

        Defendants denied allegations in the CSRASC in their answer. The parties
        are in the process of conducting discovery. The discovery deadline is
        February 28, 2002 and the trial is scheduled for July 16, 2002. A motion
        is before the court to extend these deadlines and the hearing on that
        issue is scheduled for February 4, 2002. Once discovery is complete,
        defendants will move for summary judgement dismissing the complaint.

        OTHER

        Plaintiff, who is a limited partner in the Partnership, claims that
        NAPICO and other defendants (1) have refused to provide the plaintiff
        with access to the books and records of the Partnership, and (2) have
        breached their fiduciary duties and the partnership agreement by failing
        to provide such access and by failing to act in the best interest of the
        Partnership. The defendants have,


                                       14
<PAGE>

                         REAL ESTATE ASSOCIATES LIMITED
                       (a California limited partnership)

                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)
                                DECEMBER 31, 2001

4.      CONTINGENCIES (CONTINUED)

        however, provided their books and records to plaintiff pursuant to a
        protective order. Plaintiff has failed to quantify its purported
        damages. Trial is schedule for August 13, 2002.

        The managing general partner of such NAPICO managed partnerships and the
        other defendants believe that the plaintiffs' claims are without merit
        and intend to contest the actions vigorously.

        The Corporate General Partner of the Partnership is a plaintiff in
        various lawsuits and has also been named a defendant in other lawsuits
        arising from transactions in the ordinary course of business. In the
        opinion of management and the corporate general partner, the claims will
        not result in any material liability to the Partnership.

5.      INCOME TAXES

        No provision has been made for income taxes in the accompanying
        financial statements since such taxes, if any, are the liability of the
        individual partners. The major differences in tax and financial
        reporting result from the use of different bases and depreciation
        methods for the properties held by the limited partnerships. Differences
        in tax and financial reporting also arise as losses are not recognized
        for financial reporting purposes when the investment balance has been
        reduced to zero.

6.      FAIR VALUE OF FINANCIAL INSTRUMENTS

        Statement of Financial Accounting Standards No. 107, "Disclosure about
        Fair Value of Financial Instruments," requires disclosure of fair value
        information about financial instruments. The carrying amount of assets
        and liabilities reported on the balance sheets that require such
        disclosure approximates fair value due to their short-term maturity.

7.      FOURTH QUARTER ADJUSTMENT

        The Partnership's policy is to record its equity in the income of
        limited partnerships on a quarterly basis, using estimated financial
        information furnished by the various local operating general partners.
        The equity in income of limited partnerships reflected in the
        accompanying annual financial statements is based primarily upon audited
        financial statements of the investee limited partnerships. The change
        of approximately $72,679, between the estimated nine-month equity in
        income and the actual 2001 year end equity in loss, has been recorded
        in the fourth quarter.


                                       15
<PAGE>

                                                                        SCHEDULE

                         REAL ESTATE ASSOCIATES LIMITED
                       INVESTMENTS IN LIMITED PARTNERSHIPS
                  YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999


<TABLE>
<CAPTION>
                                                           Year Ended December 31, 2001
                               ----------------------------------------------------------------------------------------
                                                                                Cash           Equity
                                Balance        Capital                         Distri-            In          Balance
                                January        Contri-       Amortization      butions          Income        December
Limited Partnerships            1, 2001        butions         Acq costs       Received         (Loss)        31, 2001
--------------------            -------        -------         ---------       --------         ------        --------
<S>                            <C>            <C>            <C>              <C>             <C>             <C>
Belleville Manor Apts          $    --        $               $               $               $               $
Benroe, Ltd. (Wedgewood)            --                                                                             --
Bethel Towers, Ltd.                 --                                                                             --
Cherry Hill, Ltd.                661,411           --            (2,785)        (40,045)         40,045         658,626
Clinton Apts., Ltd.                 --                                                                             --
Emporia, Ltd. (Northwood)           --                                                                             --
Roebern, Ltd. (Ridgeview)           --           12,545                                         (12,545)           --
West Lafayette, Ltd.                --           31,807                                         (31,807)           --
Williamson Towers, Ltd.             --                                                                             --
                               ---------      ---------       ---------       ---------       ---------       ---------
                               $ 661,411      $  44,352          (2,785)      $ (40,045)      $  (4,307)      $ 658,626
                               =========      =========       =========       =========       =========       =========
</TABLE>

<PAGE>

                                                                        SCHEDULE
                                                                     (Continued)

                         REAL ESTATE ASSOCIATES LIMITED
                       INVESTMENTS IN LIMITED PARTNERSHIPS
                  YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999


<TABLE>
<CAPTION>
                                                            Year Ended December 31, 2000
                               ---------------------------------------------------------------------------------------
                                                                                Cash           Equity
                                Balance        Capital                         Distri-           In            Balance
                                January        Contri-       Amortization      butions         Income          December
Limited Partnerships            1, 2000        butions         Acq costs       Received        (Loss)          31, 2000
--------------------            -------        -------         ---------       --------        ------          --------
<S>                            <C>            <C>             <C>             <C>             <C>            <C>
Belleville Manor Apts          $              $               $               $               $              $
Benroe, Ltd. (Wedgewood)
Bethel Towers, Ltd.
Cherry Hill, Ltd.                579,027                                        (35,733)        118,117          661,411
Clinton Apts., Ltd.
Emporia, Ltd. (Northwood)
Roebern, Ltd. (Ridgeview)
West Lafayette, Ltd.                --           24,000                                         (24,000)             --
Williamson Towers, Ltd.
                               ---------      ---------       ---------       ---------       ---------      ------------
                               $ 579,027      $  24,000       $    --         $ (35,733)      $  94,117      $    661,411
                               =========      =========       =========       =========       =========      ============
</TABLE>

<PAGE>

                                                                        SCHEDULE
                                                                     (Continued)

                         REAL ESTATE ASSOCIATES LIMITED
                       INVESTMENTS IN LIMITED PARTNERSHIPS
                  YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999

<TABLE>
<CAPTION>
                                                          Year Ended December 31, 1999
                               --------------------------------------------------------------------------------------
                                                                                Cash           Equity
                                Balance        Capital                         Distri-           In           Balance
                                January        Contri-       Amortization      butions         Income         December
Limited Partnerships            1, 1999        butions         Acq costs       Received        (Loss)         31, 1999
--------------------            -------        -------         ---------       --------        ------         --------
<S>                            <C>            <C>             <C>             <C>             <C>            <C>
Belleville Manor Apts          $              $               $               $               $              $
Benroe, Ltd. (Wedgewood)
Bethel Towers, Ltd.
Cherry Hill, Ltd.                530,241                                        (37,918)         86,704         579,027
Clinton Apts., Ltd.
Emporia, Ltd. (Northwood)
Roebern, Ltd. (Ridgeview)
West Lafayette, Ltd.                             45,000                                         (45,000)
Williamson Towers, Ltd.
                               ---------      ---------       ---------       ---------       ---------      ----------
                               $ 530,241      $  45,000       $    --         $ (37,918)      $  41,704      $  579,027
                               =========      =========       =========       =========       =========      ==========
</TABLE>

<PAGE>

                                                                        SCHEDULE
                                                                     (Continued)

                         REAL ESTATE ASSOCIATES LIMITED
          INVESTMENT IN, EQUITY IN EARNINGS OF, AND DIVIDENDS RECEIVED
                        FROM AFFILIATES AND OTHER PERSONS
                  YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999

NOTES:       1.      Equity in (loss) income of limited partnerships
                     represents the Partnership's allocable share of the net
                     results of operations from the limited partnerships for the
                     year. Equity in losses of the limited partnerships will be
                     recognized until the investment balance is reduced to zero
                     or a negative balance equal to further commitments by the
                     Partnership.

             2.      Cash distributions from the limited partnerships are
                     treated as a return of the investment and reduce the
                     investment balance until such time as the investment is
                     reduced to zero or a negative balance equal to further
                     commitments by the Partnership. Distributions subsequently
                     received are recognized as income.

<PAGE>

                                                                    SCHEDULE III

                         REAL ESTATE ASSOCIATES LIMITED
                    REAL ESTATE AND ACCUMULATED DEPRECIATION
                 OF PROPERTY HELD BY LOCAL LIMITED PARTNERSHIPS
                          IN WHICH REAL HAS INVESTMENTS
                                DECEMBER 31, 2001

<TABLE>
<CAPTION>
                                                                            Buildings,
                                                                         Furnishings and
                                                                           Equipment -
                                                                         Initial Cost to
                                                                         Partnership and
                               Number     Outstanding                     Amount Carried                  Accumulated   Construction
Partnership/Location          of Units   Mortgage Loan         Land      at Close of Year       Total     Depreciation    Period
--------------------          --------   -------------         ----      ----------------       -----     ------------    ------
<S>                           <C>        <C>             <C>             <C>                <C>           <C>           <C>
Belleville Manor, Ltd.           32      $   414,981             --        $   805,146      $   805,146   $   546,976    1978-1979
  Marion, KY
Bethel Towers, Ltd.             146        2,895,279           67,400        4,026,381        4,093,781     3,180,710          (A)
  Detroit, MI
Cherry Hill, Ltd.               186        4,572,333          448,460        8,156,245        8,604,705     5,511,676    1978-1980
  Inkster, MI
Clinton Apts. Ltd.               24          131,559           49,868          538,385          588,253       502,664    1977-1980
  Clinton, KY
Emporia, Ltd. (Northwood)        72        1,161,233           39,500        2,529,723        2,569,223     2,018,034    1978-1980
  Emporia, VA
Roebern, Ltd. (Ridgeview)        32          590,114           26,000        1,009,317        1,035,317       918,276    1978-1979
  Lewisburg, W. VA
Bernroe, Ltd. (Wedgewood)        32          598,318           45,000        1,093,731        1,138,731       938,076    1978-1979
  Ripley, W. VA
West Lafayette, Ltd.             49          931,612           35,000        1,256,812        1,291,812     1,059,586    1979-1980
  West Lafayette, OH
Williamson Towers, Ltd.          76        2,323,335             --          3,290,827        3,290,827     2,262,626    1979-1981
  Williamson, W. VA
                              --------   -----------      -----------      -----------      -----------   -----------
            TOTAL               649      $13,618,764      $   711,228      $22,706,567      $23,417,795   $16,938,624
                              ========   ===========      ===========      ===========      ===========   ===========
</TABLE>


        (A) This project was complete when REAL entered the Partnership.


<PAGE>

                                                                    SCHEDULE III
                                                                     (Continued)

                         REAL ESTATE ASSOCIATES LIMITED
              REAL ESTATE AND ACCUMULATED DEPRECIATION OF PROPERTY
                       HELD BY LOCAL LIMITED PARTNERSHIPS
                          IN WHICH REAL HAS INVESTMENTS
                                DECEMBER 31, 2001


NOTES:      1.   Each local limited partnership has developed, owns and operates
                 the housing project. Substantially all project costs, including
                 construction period interest expense, were capitalized by the
                 limited partnerships.

            2.   Depreciation is provided for by various methods over the
                 estimated useful lives of the Projects.  The estimated
                 composite useful lives of the buildings are from 25 to 40
                 years.

            3.   Investments in property and equipment:

<TABLE>
<CAPTION>
                                                     Buildings,
                                                     Furnishings
                                                        And
                                      Land           Equipment         Total
<S>                               <C>              <C>              <C>
Balance at January 1, 1999        $   711,228      $22,180,601      $22,891,829
Net additions during 1999                --            138,843          138,843
                                  -----------      -----------      -----------
Balance at December 31, 1999          711,228       22,319,444       23,030,672
Net additions during 2000                --            194,826          194,826
                                  -----------      -----------      -----------
Balance at December 31, 2000          711,228       22,514,270       23,225,498
Net additions during 2001                --            192,297          192,297
                                  -----------      -----------      -----------
Balance at December 31, 2001      $   711,228      $22,706,567      $23,417,795
                                  ===========      ===========      ===========
</TABLE>

<PAGE>

                                                                    SCHEDULE III
                                                                     (Continued)

                         REAL ESTATE ASSOCIATES LIMITED
              REAL ESTATE AND ACCUMULATED DEPRECIATION OF PROPERTY
                       HELD BY LOCAL LIMITED PARTNERSHIPS
                          IN WHICH REAL HAS INVESTMENTS
                                DECEMBER 31, 2001


<TABLE>
<CAPTION>
                                   Buildings,
                                  Furnishings
                                      And
                                   Equipment
                                  -----------
<S>                               <C>
Accumulated Depreciation:
Balance at January 1, 1999        $14,991,022
Net additions during 1999             569,358
                                  -----------
Balance at December 31, 1999       15,560,380
Net additions during 2000             693,511
                                  -----------
Balance at December 31, 2000       16,253,891
Net additions during 2001             684,733
                                  -----------
Balance at December 31, 2001      $16,938,624
                                  ===========
</TABLE>

<PAGE>

PART III.

ITEM 10.        DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT:

REAL ESTATE ASSOCIATES LIMITED (the "Partnership") has no directors or executive
officers of its own.

Prior to December 30, 1998, NAPICO was a wholly owned subsidiary of Casden
Investment Corporation ("CIC"), which is wholly owned by Alan I. Casden. On
December 30, 1998, Casden Properties Operating Partnership, L.P., (the
"Operating Partnership") a majority owned subsidiary of Casden Properties Inc.,
a real estate investment trust organized by Alan I. Casden, purchased a 95.25%
economic interest in NAPICO. On March 11, 2002, NAPICO became a wholly owned
subsidiary of Apartment Investment and Management Company. The following
biographical information is presented for the directors and executive officers
of NAPICO with principal responsibility for the Partnership's affairs.

CHARLES H. BOXENBAUM, 72, Chairman of the Board of Directors and Chief Executive
Officer of NAPICO.

Mr. Boxenbaum has been associated with NAPICO since its inception. He has been
active in the real estate industry since 1960, and prior to joining NAPICO was a
real estate broker with the Beverly Hills firm of Carl Rhodes Company. Mr.
Boxenbaum has been a member of the Board of Directors of Casden Properties Inc.
since 1998.

Mr. Boxenbaum has been a guest lecturer at national and state realty
conventions, certified properties exchanger's seminars, Los Angeles Town Hall,
National Association of Home Builders, International Council of Shopping
Centers, Society of Conventional Appraisers, California Real Estate Association,
National Institute of Real Estate Brokers, Appraisal Institute, various mortgage
banking seminars, and the North American Property Forum held in London, England.
He is one of the founders and a past director of the First Los Angeles Bank,
organized in November 1974. Since March 1995, Mr. Boxenbaum has served on the
Board of Directors of the National Housing Council. Mr. Boxenbaum received his
Bachelor of Arts degree from the University of Chicago.

BRUCE E. NELSON, 50, President, Chief Operating Officer and a director of
NAPICO.

Mr. Nelson joined NAPICO in 1980 and became President in February 1989. He is
responsible for the operations of all NAPICO sponsored limited partnerships.
Prior to that he was primarily responsible for the securities aspects of the
publicly offered real estate investment programs. Mr. Nelson is also involved in
the identification, analysis, and negotiation of real estate investments. Mr.
Nelson is a member of the Board of Directors of Casden Properties Inc. and is a
Director of the Affordable Housing Tax Credit Coalition.

From February 1979 to October 1980, Mr. Nelson held the position of Associate
General Counsel at Western Consulting Group, Inc., private residential and
commercial real estate syndicators. Prior to that time, Mr. Nelson was engaged
in the private practice of law in Los Angeles. Mr. Nelson received his Bachelor
of Arts degree from the University of Wisconsin and is a graduate of the
University of Colorado School of Law. He is a member of the State Bar of
California and is a licensed real estate broker in California and Texas.

ALAN I. CASDEN, 56, Chairman of the Board of Directors and Chief Executive
Officer of Casden Properties Inc., a director and member of the audit committee
of NAPICO, and chairman of the Executive Committee of NAPICO.

Mr. Casden has been involved in approximately $3 billion of real estate
financings and sales and has been responsible for the development and
construction of more than 12,000 apartment units and 5,000 single-family homes
and condominiums.

<PAGE>

Mr. Casden is a member of the American Institute of Certified Public Accountants
and of the California Society of Certified Public Accountants. Mr. Casden is a
member of the advisory board of the National Multi-Family Housing Conference,
the Multi-Family Housing Council, the President's Council of the California
Building Industry Association and the Urban Land Institute. He also serves on
the Board of Trustees of the University of Southern California. He holds a
Bachelor of Science degree and a Masters in Business Administration degree from
the University of Southern California.

BRIAN H. SHUMAN, 39, Senior Vice President and Chief Financial Officer.

Mr. Shuman joined NAPICO in 2000, and is responsible for the financial affairs
of NAPICO, as well as the limited partnerships sponsored by it. From 1996 until
joining NAPICO in August 2000, Mr. Shuman was Vice President - Finance for
Preferred Health Management Inc., the largest provider of worker compensation
diagnostic imaging services in California formed in 1996, and was responsible
for establishing and managing the accounting, billing, collection , treasury and
financial reporting departments. From 1994 to 1996, he was the Controller for
DVI Business Credit Corporation, which provides asset based lending to a wide
range of health concerns. From 1985 to 1994, Mr. Shuman served in senior
management positions, as a director or manager of finance, a portfolio tax
analyst, and a senior accountant/tax consultant. He holds a Bachelor of Arts
degree in economics and accounting from the University of Maryland. Mr. Shuman
is a Certified Public Accountant and is a member of American Institute of
Certified Public Accountants and the California Society of Public Accountants.

PATRICIA W. TOY, 72, Senior Vice President - Communications and Assistant
Secretary.

Mrs. Toy joined NAPICO in 1977, following her receipt of an MBA from the
Graduate School of Management, UCLA. From 1952 to 1956, Mrs. Toy served as a
U.S. Naval Officer in communications and personnel assignments. She holds a
Bachelor of Arts Degree from the University of Nebraska.

JEFFREY H. SUSSMAN, 35, Senior Vice President, General Counsel and Secretary.

Mr. Sussman joined NAPICO in 1998, and is responsible for the legal affairs of
NAPICO and its affiliates. He is also the President of NPEI and a member of the
preliminary investment committee. Prior to joining NAPICO in April 1998, Mr.
Sussman was an associate with the law firm of Rus, Miliband, Williams & Smith in
Irvine, California. His practice emphasized real estate finance and insolvency
law and included the representation of borrowers, lenders, and court-appointed
trustees in matters involving apartment complexes, retail centers and hotels.
Mr. Sussman received a Bachelor of Arts degree from the University of
California, Berkeley and Juris Doctor and Master in Business Administration
degrees from the University of Southern California. He is a member of the State
Bar of California, and holds Series 22, 39 and 63 licenses issued by the
National Association of Securities Dealers, Inc.

NAPICO and several of its officers, directors and affiliates, including Charles
H. Boxenbaum, Bruce E. Nelson and Alan I. Casden, consented to the entry, on
June 25, 1997, of an administrative cease and desist order by the U.S.
Securities and Exchange Commission (the "Commission"), without admitting or
denying any of the findings made by the Commission. The Commission found that
NAPICO and others had violated certain federal securities laws in connection
with transactions unrelated to the Partnership. The Commission's order did not
impose any cost, burden or penalty on any partnership managed by NAPICO and does
not impact NAPICO's ability to serve as the Partnership's Managing General
Partner.

<PAGE>

ITEM 11.        MANAGEMENT REMUNERATION AND TRANSACTIONS:

Real Estate Associates Limited has no officers, employees, or directors.
However, under the terms of the Restated Certificate and Agreement of Limited
Partnership, the Partnership is obligated to pay the Corporate General Partner
an annual management fee. The annual management fee is equal to .5 percent of
the invested assets, including the Partnership's allocable share of the
mortgages related to real estate properties held by local limited partnerships.
The fee is earned beginning in the month the Partnership makes its initial
contribution to the limited partnership. In addition, the Partnership reimburses
the Corporate General Partner for certain expenses.

An affiliate of the Corporate General Partner is responsible for the on-site
property management for one property owned by a limited partnership in which the
Partnership has invested.

ITEM 12.        SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT:

(a)      Security Ownership of Certain Beneficial Owners

         The general partners own all of the outstanding general partnership
         interests of REAL; no person is known to own beneficially in excess of
         5 percent of the outstanding limited partnership interests.

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

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS:

The Partnership has no officers, directors or employees of its own. All of its
affairs are managed by the Corporate General Partner, National Partnership
Investments Corp. The Partnership is obligated to NAPICO for an annual
management fee equal to .5 percent of the original remaining invested assets of
the limited partnerships. Invested assets is defined as the costs of acquiring
project interests, including the proportionate amount of the mortgage loans
related to the Partnership's interest in the capital accounts of the respective
partnerships. The management fee was $106,212, $106,207 and $106,232 for the
years ended December 31, 2001, 2000 and 1999, respectively.

The Partnership reimburses NAPICO for certain expenses. The reimbursement to
NAPICO was $9,360, $6,760 and $3,300 in 2001, 2000 and 1999, respectively, and
is included in operating expenses.

An affiliate of NAPICO is the general partner in one of the limited partnerships
in which the Partnership has an investment, and another affiliate receives
property management fees of 5 percent of its revenues. The affiliate received
property management fees of $11,339, $6,127 and $6,975 in 2001, 2000 and 1999,
respectively.

On December 30, 1998, the Partnership sold its limited partnership interests in
8 local limited partnerships to the Operating Partnership. The sale resulted in
cash proceeds to the Partnership of $3,900,000 and a net gain of $3,798,734,
after deducting the selling costs. The cash proceeds were held in escrow at
December 31, 1998 and were collected subsequent to year-end. In March 1999, the
Partnership made a cash distribution of $3,861,000 to the limited partners and
$39,000 to the general partners, primarily using proceeds from the sale of the
partnership interests.

<PAGE>

The Operating Partnership purchased such limited partner interests for cash,
which it raised in connection with a private placement of its equity securities.
The purchase was subject to, among other things, (i) the purchase of the general
partner interests in the local limited partnerships by the REIT; (ii) the
approval of HUD and certain state housing finance agencies; and (iii) the
consent of the limited partners to the sale of the local limited partnership
interests held for investment by the Partnership.

In August 1998, a consent solicitation statement was sent to the limited
partners setting forth the terms and conditions of the purchase of the limited
partners' interests held for investment by the Partnership, together with
certain amendments to the Partnership Agreement and other disclosures of various
conflicts of interest in connection with the proposed transaction. Prior to the
sale of the partnership interests, the consents of the limited partners to the
sale and amendments to the Partnership Agreement were obtained.

PART IV.

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

FINANCIAL STATEMENTS

Report of Independent Public Accountants.

Balance Sheets as of December 31, 2001 and 2000.

Statements of Operations for the years ended December 31, 2001, 2000 and 1999.

Statements of Partners' Equity (Deficiency) for the years ended December 31,
2001, 2000 and 1999.

Statements of Cash Flows for the years ended December 31, 2001, 2000 and 1999.

Notes to Financial Statements.

FINANCIAL STATEMENT SCHEDULES
APPLICABLE TO REAL ESTATE ASSOCIATES LIMITED AND THE LIMITED PARTNERSHIPS IN
WHICH REAL ESTATE ASSOCIATES LIMITED HAS INVESTMENTS:

Schedule - Investments in Limited Partnerships, December 31, 2001, 2000 and
1999.

Schedule III - Real estate and accumulated depreciation, December 31, 2001, 2000
and 1999.

The remaining schedules are omitted because the required information is included
in the financial statements and notes thereto as they are not applicable or not
required.

EXHIBITS

(3)      Articles of incorporation and bylaws: The registrant is not
         incorporated. The Partnership Agreement was filed with Form S-11
         Registration # 260561 incorporated herein by reference.

(10)     Material contracts: The registrant is not party to any material
         contracts, other than the Restated Certificate and Agreement of Limited
         Partnership dated September 15, 1979 previously filed and which is
         hereby incorporated by reference.

REPORTS ON FORM 8-K

No reports on Form 8-K were filed during the year ended December 31, 2001.

<PAGE>

                                   SIGNATURES

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

REAL ESTATE ASSOCIATES LIMITED

By:         NATIONAL PARTNERSHIP INVESTMENTS CORP.
            General Partner


/s/__________________________________
Charles H. Boxenbaum
Chairman of the Board of Directors
and Chief Executive Officer


/s/__________________________________
Bruce E. Nelson
Director and President


/s/__________________________________
Alan I. Casden
Director


/s/__________________________________
Brian H. Shuman
Chief Financial Officer