SECURITIES AND EXCHANGE COMMISSION
                   Washington, D.C. 20549
                             
                        FORM 10-QSB
                             
                             
[X]     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
            THE SECURITIES EXCHANGE ACT of 1934
                             
      For the Quarterly Period Ended November 30, 1996
                             
             Commission File Number 33-67536-A
                                                                              



           FEDERAL AFFORDABLE HOUSING CORPORATION
(Exact Name of Small Business Issuer as specified in its charter)
                             
                                                                             


       Minnesota                                    59-3169033                
 (State or other Jurisdiction of             (IRS Employer Identification No.)
   Incorporation or Organization)


                 1616 Gulf-to-Bay Boulevard
                Clearwater, Florida   34615
                       (813) 446-7981
    (Address of Principal Executive Offices, including
              Zip Code, and telephone number)

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

As of November 30, 1996, there were 164,500 shares of Common Stock outstanding
and 74,500 Investor's Stock Purchase Warrants outstanding.

Transitional Small Business Disclosure Format: Yes   x   No      



INFORMATION REQUIRED IN QUARTERLY REPORT OF TRANSITIONAL SMALL
BUSINESS
                          ISSUERS.
                             
                           PART I
                             
                   FINANCIAL INFORMATION


ITEM 1.  FINANCIAL STATEMENTS

The information required by Item 310(b) of Regulation S-B is attached.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
         OPERATION
        
[The Registrant is a transitional small business issuer which relied upon
Alternative 2 under "Information Required in Annual Report of Transitional
Small Business Issuers" in its most recent 10-KSB, and accordingly chooses
here to update the response to Item 6(a)(3)(i) to Model B of Form 1-A.]

The Company completed its public offering on June 6, 1995, and received net
proceeds of $359,336.

The Company's plan of operation for the twelve month period ended May 31, 1997
calls for continued development of infrastructure scaled according to the net
proceeds of its offering and aggressive marketing.  Management believes that
the balance remaining of its net proceeds of $359,336 from its offering
is sufficient to carry out its plan of operation for the twelve months
through May, 1997, without revenues from operations.

The Company anticipates that its major expense during the twelve month period
ending May 31, 1997 will be infrastructure development.  Upon completion of
infrastructure development, the Company anticipates that its only expenses
will be executive compensation, real estate taxes, general corporate purposes
(including marketing and sales) and perhaps model home construction.  In
addition, the Company plans to limit additional property acquisitions and
infrastructure development until purchase agreements have been executed
for approximately half of the developed lots.  The Company believes that its
plan of scaled infrastructure development and limitation on acquisition and
development will enable it to operate with the net proceeds of its public
offering, without revenues from operations for the twelve month period ending
May 31, 1997.

The Company anticipates that it will hire additional commissioned sales persons
prior to June, 1997.  However, such sales persons will be paid only on a
straight commission basis and will be entitled to payment only upon revenue
generation.  Accordingly, the Company does not expect that hiring such
commissioned sales persons will have a significant impact on the Company's
ability to operate without revenues from operations.  

The Company does not intend to conduct any product research or development or
to purchase or sell any plant or equipment prior to June , 1997.






                          PART II
                              

ITEM 1.  LEGAL PROCEEDINGS 

              Not applicable.

ITEM 2.  CHANGES IN SECURITIES

              Not applicable.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

              Not applicable.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OR SECURITIES HOLDERS

              Not applicable.

ITEM 5.  OTHER INFORMATION

              Not applicable.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

              (a) Exhibits.   See the Index to Exhibits, below.

              (b) Reports on Form 8-K.  Not applicable.




INDEX TO EXHIBITS.

All of the items below are incorporated by reference to the Registrant's
Registration Statement on Form SB-2, File No. 33-67536-A, effective March 10,
1995, except for Item 27.1, which is included with this filing.



                    Number                         Description

              4.1  Form of Common Stock Certificate
                   (Exhibit 4.A. of Form SB-2)

              4.2  Form of Investor's Stock Purchase Warrant Certificate
                   (Exhibit 4.B. of Form SB-2)

              10.1 Option Agreement between Registrant, RemProp, Inc.,
                   and Key Management, Inc.
                   (Exhibit 10.A. of Form SB-2)

              10.2 First Amendment to Option Agreement
                   (Exhibit 10.B. of Form SB-2)

              10.3 Second Amendment to Option Agreement
                   (Exhibit 10.C. of Form SB-2)

              10.4 Lease Agreement between Registrant and RemProp, Inc.
                   (Exhibit 10.D. of Form SB-2)

              27.1 Financial Data Schedule *

              99.1 Registrant's Registration Statement on Form SB-2, as
                   amended.
                  
              99.2 Registrant's Final Prospectus, dated March 10, 1995,
                   filed under Rule 424(b) of the 1933 Act.


* Included with this report.  All other items are incoporated by reference to
the Registrant's Form SB-2, File No. 33-67536-A, effective March 10, 1995.


                         SIGNATURES


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


                                  FEDERAL AFFORDABLE HOUSING CORPORATION 



Date:       May 24, 1997          By: /s/ Richard E. Metz                      
                                      Richard E. Metz     
                                   President, CEO
                                    (Principal Executive Officer)  

 

                                  By: /s/ Wayne A. Weyrauch                
                                  Wayne A. Weyrauch
                                    Vice President of Finance, CFO
                                    (Principal Financial Officer,
                                     Principal Accounting Officer)



       J. MICHAEL DAILY & ASSOCIATES
          1822 DREW STREET, SUITE 1
          CLEARWATER, FLORIDA 34625
                   
                   
                                             May 9, 1997
                   
                   
          FEDERAL AFFORDABLE HOUSING
          P.O. BOX 6163
          CLEARWATER, FL 34618
                   
                   
                   
              We  have  compiled  the  accompanying  balance  sheet  of
          FEDERAL AFFORDABLE HOUSING as of November 30, 1996,  and  the
          related statement of revenues  and  expenses  for  the  three
          months  and  six  months  then  ended,  and  the  comparative
          statement of income for the three months and six months ended
          November 30, 1996 and 1995, and the statement of  cash  flows
          for the three months and six months then ended in  accordance
          with  Statements  on  Standards  for  Accounting  and  Review
          Services issued by the American Institute of Certified Public
          Accountants.
                   
              A compilation is limited to presenting  in  the  form  of
          financial statements information that is  the  representation
          of  management.  We  have  not  audited   or   reviewed   the
          accompanying financial statements and,  accordingly,  do  not
          express an opinion or any other form of assurance on them.
                   
              Management has elected to omit substantially all  of  the
          disclosures  required  by   generally   accepted   accounting
          principles. If the disclosures were included in the financial
          statements, they might influence the user's conclusions about
          the Company's financial position, results of  operations  and
          cash flows. Accordingly, these financial statements  are  not
          designed for those who are not informed about such matters.
                   
                   
          
          J. MICHAEL DAILY, CPA
                    FEDERAL AFFORDABLE HOUSING CORPORATION
                                BALANCE SHEET
                              NOVEMBER 30, 1996
                   
                   
                   
                                    ASSETS
                   
CURRENT ASSETS     
   CASH IN BANK - SUNTRUST         $   (719.43)
   CD - SUN BANK                    300,000.00
   DUE FROM SUNCOAST FOOD            52,378.38
   DUE FROM REMPROP                   2,045.82
   LAND HELD FOR DEVELOPMENT         58,512.00
   COSTS- 35 LOTS                   175,665.61
   HOUSE CONSTRUCTION IN PROCESS     46,844.25
   DADE CITY CONSTRUCTION IN PROGRESS   953.60
                                     ------------
   TOTAL CURRENT ASSETS                                        $   635,680.23

   OTHER ASSETS       
   REGISTRATION STATEMENT COSTS       59,955.14
   DEPOSIT - UTILITY                     423.53
                                     -------------
   TOTAL OTHER ASSETS                                               60,378.67
                                                                  -------------
   TOTAL ASSETS                                                $   696,058.90
                                                                 =============
                                    
                   
                   
                   
                          
                                   
                     SEE ACCOUNTANT'S COMPILATION REPORT
                        J. MICHAEL DAILY & ASSOCIATES
                                CLEARWATER, FL


           FEDERAL AFFORDABLE HOUSING CORPORATION
                                BALANCE SHEET
                              NOVEMBER 30, 1996
                   
                   
                   
                     LIABILITIES AND STOCKHOLDERS' EQUITY
                   
CURRENT LIABILITIES
   NOTE PAYABLE - R. METZ        $     8,931.00
   COMMERCIAL LOAN-SUNTRUST          266,074.00
                                    -------------
   TOTAL CURRENT LIABILITIES                              $   275,005.00
                                                             -------------
   TOTAL LIABILITIES                                          275,005.00
                   
EQUITY             
   COMMON STOCK                       486,887.00
   RETAINED EARNINGS                  (48,544.86)
   CURRENT/YTD PROFIT OR LOSS         (17,288.24)
                                    -------------
   TOTAL EQUITY                                                421,053.90
                                                             -------------
   TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY              $   696,058.90
                                                             =============
                   
                   
                   
                   
                   
                   
                   
                   
                                   
                   
                     SEE ACCOUNTANT'S COMPILATION REPORT
                        J. MICHAEL DAILY & ASSOCIATES
                                CLEARWATER, FL





                    FEDERAL AFFORDABLE HOUSING CORPORATION
                      STATEMENT OF REVENUES AND EXPENSES
                  FOR THE THREE MONTHS AND SIX MONTHS ENDED
                              NOVEMBER 30, 1996
                   
                                 CURRENT PERIOD              YEAR TO DATE
                                AMOUNT   PERCENT           AMOUNT   PERCENT
                   
                   
INCOME                        --------    ------            -------   ------
   TOTAL INCOME              $   0.00      0.00           $  0.00      0.00
                              --------    ------            -------   ------
EXPENSES           
   AMORTIZATION OF
     ORG. EXPENSE            4,282.50      0.00           8,565.00     0.00
   BANK CHARGES                128.14      0.00             192.68     0.00
   GAS AND OIL                  39.99      0.00              39.99     0.00
   INTEREST EXPENSE          4,250.68      0.00           7,282.09     0.00
   LEGAL AND
      ACCOUNTING             1,536.61      0.00           5,845.86     0.00
   RENT                      1,070.00      0.00           1,070.00     0.00
   UTILITIES                   698.33      0.00           1,484.10     0.00
                             ---------    ------         ---------    ------
   TOTAL EXPENSES           12,006.25      0.00           24,479.72    0.00
                           ---------      ------          ---------   ------
   INCOME FROM
     OPERATIONS            (12,006.25)    (0.00)         (24,479.72)  (0.00)
                             ---------    ------         ----------   ------
OTHER INCOME       
   INTEREST INCOME
      - CD                   3,543.44      0.00            7,191.48    0.00
                            ---------     ------          ----------  ------
   TOTAL OTHER
     INCOME                  3,543.44      0.00            7,191.48    0.00
                            ---------      ------         ----------  ------
   NET INCOME            $  (8,462.81)    (0.00)        $(17,288.24)  (0.00)
                           ===========    ======        ===========   ======
                   
         SEE ACCOUNTANT'S COMPILATION REPORT
                        J. MICHAEL DAILY & ASSOCIATES
                                CLEARWATER, FL






FEDERAL AFFORDABLE HOUSING CORPORATION
COMPARATIVE STATEMENT OF REVENUES AND
EXPENSES FOR THE THREE MONTHS AND SIX MONTHS ENDED
         NOVEMBER 30, 1996 AND 1995
                   
                  1996             1995           1996               1995
              CURRENT PERIOD   CURRENT PERIOD    YEAR TO DATE      YEAR TO DATE
             AMOUNT   PERCENT AMOUNT   PERCENT  AMOUNT   PERCENT AMOUNT PERCENT
                   
INCOME
             ------  ------   ------   ------  --------  ------   ------  ------
TOTAL INCOME$  0.00   0.00   $  0.00    0.00   $  0.00    0.00   $  0.00    0.00
             ------  ------   ------   ------  --------  ------    ------ ------
EXPENSES           
 ADVERTISING   0.00   0.00      0.00    0.00      0.00    0.00     66.81    0.00
AMORTIZATION OF
 ORG.
  EXPENSE   4,282.50  0.00      0.00    0.00   8,565.00   0.00      0.00    0.00
BANK CHARGES  128.14  0.00    105.88    0.00     192.68   0.00    118.55    0.00
GAS AND OIL    39.99  0.00      0.00    0.00      39.99   0.00      0.00    0.00
INTEREST
  EXPENSE   4,250.68  0.00      0.00    0.00   7,282.09   0.00      0.00    0.00
LEGAL AND
 ACCOUNTING 1,536.61  0.00    500.00    0.00   5,845.86   0.00    500.00    0.00
MANAGEMENT
  FEES          0.00  0.00  7,500.00    0.00       0.00   0.00 16,500.00    0.00
OFFICE EXPENSE  0.00  0.00    417.47    0.00       0.00   0.00    504.35    0.00
RENT        1,070.00  0.00  1,605.00    0.00   1,070.00   0.00  3,210.00    0.00
TAXES AND
 LICENSES       0.00  0.00      0.00    0.00       0.00   0.00  7,029.33    0.00
TELEPHONE       0.00  0.00    217.42    0.00       0.00   0.00    564.87    0.00
UTILITIES     698.33  0.00    720.84    0.00   1,484.10   0.00  1,131.71    0.00
            -------- ------    ------  ------ ---------  ------ --------  ------
TOTAL
  EXPENSES 12,006.25  0.00  1,066.61    0.00  24,479.72   0.00  29,625.62   0.00
           --------- ------ --------   ------ ---------  ------ ---------  -----
INCOME
FROM
OPERATIONS(12,006.25)(0.00)(11,066.61) (0.00)(24,479.72) (0.00)(29,625.62)(0.00)
          ---------- ------ ---------  ----- ---------    ----- -------    -----
OTHER INCOME       
INTEREST INCOME
 - CD       3,543.44  0.00   3,864.45   0.00   7,191.48   0.00   6,426.72  0.00
INTEREST INCOME
 - ESCROW       0.00  0.00       0.00   0.00       0.00   0.00   1,691.46  0.00
ESCROW FEES     0.00  0.00       0.00   0.00       0.00   0.00    (813.76)(0.00)
            -------- -----     ------- ------    ------  ------  --------- ----
TOTAL OTHER
 INCOME      3,543.44 0.00   3,864.45   0.00    7,191.48  0.00    7,304.42  0.00
            --------- ----   --------  ------     ------  ------  --------  ----
NET
  INCOME $(8,462.81)(0.00) $(7,202.16)(0.00)$(17,288.24)(0.00)$(22,321.20)(0.00)
           ======== ======   =======  ====== =========  ====== ======  ======
                            
                               SEE ACCOUNTANT'S COMPILATION REPORT
                                    J. MICHAEL DAILY & ASSOCIATES
                                            CLEARWATER, FL
                 

 FEDERAL AFFORDABLE HOUSING CORPORATION
         STATEMENT OF CASH FLOWS
  FOR THE PERIOD ENDED NOVEMBER 30, 1996
                                            CURRENT PERIOD     YEAR TO DATE
                                             ______________     ____________
                   
CASH FLOWS FROM OPERATING ACTIVITIES
____________________________________
     NET INCOME (LOSS)                      $   (8,462.81)     $  (17,288.24)
     ADJUSTMENTS TO RECONCILE NET INCOME TO
       NET CASH PROVIDED:
       AMORTIZATION - DEBITS TO INCOME           4,282.50           8,565.00
       DECREASE (INCREASE) IN OPERATING ASSETS:
         ACCOUNTS RECEIVABLE                    (7,914.98)        (18,575.45)
         INVENTORY                             (20,463.77)        (54,671.57)
         OTHER OPERATIONS-RELATED ASSETS           531.47              31.47
                                               ____________      _____________
       TOTAL ADJUSTMENTS                       (23,564.78)        (64,650.55)
                                               ____________      ____________
     NET CASH FLOW FROM OPERATIONS             (32,027.59)        (81,938.79)
                   
                   
   CASH FLOWS FROM FINANCING ACTIVITIES
  ____________________________________
     INFLOWS:      
       INCREASES IN SHORT-TERM NOTES PAYABLE    30,000.00          80,000.00
                                              ____________        ___________
     NET CASH FROM FINANCING ACTIVITIES         30,000.00          80,000.00
                                              ____________        ___________
                        
   NET INCREASE (DECR) IN CASH & EQUIVALENTS   (2,027.59)          (1,938.79)
   BEGINNING CASH AND EQUIVALENTS               1,308.16            1,219.36
                                              ____________        ___________
   ENDING CASH & CASH EQUIVALENTS            $   (719.43)        $   (719.43)
                                             =============        ===========
                                       
   DISCLOSURE OF ACCOUNTING POLICY:
   ________________________________
   FOR PURPOSES OF THE STATEMENT OF CASH FLOWS, THE COMPANY   
CONSIDERSALL HIGHLY LIQUID DEBT INSTRUMENTS PURCHASED WITH A MATURITY OF
THREE MONTHS OR LESS TO BE CASH EQUIVALENTS.
                   
                                     
                   
                   
                                      
                   
                     SEE ACCOUNTANT'S COMPILATION REPORT
                        J. MICHAEL DAILY & ASSOCIATES
                                CLEARWATER, FL