FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549



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

                For the quarterly period ended September 30, 1996

                                       OR

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


                         Commission file number: 0-14207


                             RANCON REALTY FUND IV,
                        A CALIFORNIA LIMITED PARTNERSHIP
             (Exact name of registrant as specified in its charter)



                California                             33-0016355
     (State or other jurisdiction of                (I.R.S. Employer
     incorporation or organization)               Identification  No.)

  400 South El Camino Real, Suite 1100
          San Mateo, California                          94402
          (Address of principal                       (Zip Code)
           executive offices)


                                 (415) 343-9300
              (Registrant's telephone number, including area code)

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

                                     Yes    X     No
                                          ----       ----    

       Total number of units outstanding as of September 30, 1996: 79,846

                                  Page 1 of 17

<PAGE>



PART 1.           FINANCIAL INFORMATION

Item 1.           Financial Statements
<TABLE>
<CAPTION>

                             RANCON REALTY FUND IV,
                        A CALIFORNIA LIMITED PARTNERSHIP

                           Consolidated Balance Sheets
                    (in thousands, except units outstanding)
                                   (Unaudited)

                                                    September 30,   December 31,
                                                        1996           1995
<S>                                                    <C>            <C>
Assets
Real estate investments:
   Rental property, net of accumulated depreciation
      of $12,658 and $11,800 at September 30, 1996
      and December 31, 1995, respectively              $39,002        $30,766
   Construction in progress                              1,018          2,931
   Land held for development                             8,728          9,088
   Land held for sale                                    1,386          1,632
                                                       -------        -------

Total real estate investments                           50,134         44,417

Cash and cash equivalents                                  363          1,296
Restricted cash                                            100            926
Accounts and interest receivable                            60              8
Note receivable                                            405            405
Deferred financing costs and other fees, net of
   accumulated amortization of $738 and $674 at
   September 30, 1996 and December 31, 1995,
   respectively                                            705            640
Prepaid expenses and other assets                          723            590
                                                       -------        -------

      Total assets                                     $52,490        $48,282
                                                       =======        =======














                                  - continued -

                                  Page 2 of 17

</TABLE>
<PAGE>


<TABLE>
<CAPTION>


                             RANCON REALTY FUND IV,
                        A CALIFORNIA LIMITED PARTNERSHIP

                     Consolidated Balance Sheets - continued
                    (in thousands, except units outstanding)
                                   (Unaudited)

                                                    September 30,   December 31,
                                                       1996             1995

<S>                                                    <C>            <C>
Liabilities and Partners' Equity (Deficit)
Liabilities:
    Accounts payable and accrued expenses              $    544       $    356
    Interest payable                                         47             --
    Notes payable                                        17,318         11,757
                                                       --------       --------

       Total liabilities                                 17,909         12,113
                                                       --------       --------

Commitments and contingent liabilities (see Note 5)

Partners' equity (deficit):
    General partners                                       (891)         (891)
    Limited partners, 79,846 limited
       partnership units outstanding at
       September 30, 1996 and December 31, 1995          35,472         37,060
                                                       --------       --------

       Total partners' equity                            34,581         36,169
                                                       --------       --------

       Total liabilities and partners' equity          $ 52,490       $ 48,282
                                                       ========       ========




















                 See accompanying notes to financial statements.

                                  Page 3 of 17
</TABLE>

<PAGE>



                                 RANCON REALTY FUND IV,
                            A CALIFORNIA LIMITED PARTNERSHIP
<TABLE>
<CAPTION>

                          Consolidated Statements of Operations
              (in thousands, except per unit amounts and units outstanding)
                                       (Unaudited)

                                         Three Months Ended          Nine
Months Ended
                                     September 30,   July 31,   September 30,  
July 31,
                                          1996         1995           1996     
  1995
                                      -----------  ----------    ----------   
--------
<S>                                      <C>         <C>           <C>        
<C>
Revenues:
  Rental income                          $  1,410    $  1,398      $  3,579   
$  4,378
  Interest and other income                    56          35           110    
     89
                                         --------    --------      --------   
--------

    Total revenues                          1,466       1,433         3,689    
  4,467
                                         --------    --------      --------   
--------

Expenses:
  Operating, including $61 reimbursed
    to Sponsor in 1995                        583         667         1,671    
  1,903
  Interest expense                            390         209           968    
    534
  Depreciation and amortization               280         422         1,008    
  1,155
  Expenses associated with
    undeveloped land, including
    $4 reimbursed to Sponsor
    in 1995                                   290         209           692    
    620
  General and administrative expenses,
    including $304 to Sponsor in 1995         283         295           938    
  1,098
                                         --------    --------      --------   
--------

    Total expenses                          1,826       1,802         5,277    
  5,310
                                         --------    --------      --------   
--------

Net loss                                 $   (360)   $   (369)     $ (1,588)  
$   (843)
                                         ========    ========      ========   
========


Net loss per limited partnership unit    $  (4.51)   $  (4.62)     $ (19.89)  
$ (10.56)
                                         ========    ========      ========   
========


Weighted average number of limited
  partnership units outstanding during
  each period used to compute net loss
  per limited partnership unit             79,846      79,844        79,846    
 79,852
                                         ========    ========      ========   
========








                     See accompanying notes to financial statements.

                                      Page 4 of 17
</TABLE>

<PAGE>



                                   RANCON REALTY FUND IV,
                              A CALIFORNIA LIMITED PARTNERSHIP
<TABLE>
<CAPTION>

            Consolidated Statements of Partners' Equity (Deficit) (in thousands)
              For the nine months ended September 30, 1996 and July 31, 1995
                                        (Unaudited)


                                              General          Limited
                                             Partners         Partners         
  Total
                                            ----------       -----------      
-----------
<S>                                         <C>              <C>              
<C>       
Balance at December 31, 1995                $     (891)      $    37,060      
$    36,169

Net loss                                           ---            (1,588)      
    (1,588)
                                            ----------       -----------      
-----------

Balance at September 30, 1996               $     (891)      $    35,472      
$    34,581
                                            ==========       ===========      
===========




Balance at October 31, 1994                 $     (891)      $    50,797      
$    49,906

Retirement of limited partnership units            ---               (12)      
       (12)

Net loss                                           ---              (843)      
      (843)
                                            ----------       -----------      
-----------

Balance at July 31, 1995                    $     (891)      $    49,942      
$    49,051
                                            ==========       ===========      
===========




















                      See accompanying notes to financial statements.

                                        Page 5 of 17
</TABLE>

<PAGE>



                             RANCON REALTY FUND IV,
                        A CALIFORNIA LIMITED PARTNERSHIP

              Consolidated Statements of Cash Flows (in thousands)
                                   (Unaudited)

                                                            Nine months ended
                                                       September 30,    July 31,
                                                            1996          1995
                                                        -----------     --------

Cash flows from operating activities:
  Net loss                                                 $(1,588)     $  (843)
  Adjustments to reconcile net loss to net cash
   provided by (used for) operating activities:
     Depreciation and amortization                           1,008        1,155
     Amortization of loan fees,
      included in interest expense                              53           28
     Changes in certain assets and liabilities:
      Accounts and interest receivable                         (52)           3
      Prepaid expenses and other assets                       (133)         164
      Accounts payable and accrued expenses                    188         (246)
      Interest payable                                          47            2
      Payable to Sponsor                                        --           (8)
      Lease commissions paid                                   (57)          (4)
                                                           -------      -------

  Net cash provided by (used for) operating activities        (534)         251
                                                           -------      -------

Cash flows from investing activities:
 Funds released from restricted cash                           826           --
 Proceeds from sale of real estate                             248           --
 Collection on notes receivable                                 --          720
 Additions to real estate and property
   development costs                                        (6,823)      (1,642)
                                                           -------      -------

  Net cash used for investing activities                   $(5,749)     $  (922)
                                                           -------      -------











                                  - continued -

                                  Page 6 of 17

<PAGE>



                             RANCON REALTY FUND IV,
                        A CALIFORNIA LIMITED PARTNERSHIP

        Consolidated Statements of Cash Flows (in thousands) - continued
                                   (Unaudited)

                                                            Nine months ended
                                                       September 30,    July 31,
                                                           1996           1995
                                                       -----------     --------

Cash flows from financing activities:
 Net loan proceeds                                       $ 12,136      $  2,625
 Notes payable principal payments                          (6,575)         (139)
 Other liabilities                                           --              13
 Retirement of limited partnership units                     --             (12)
 Payment of loan fees                                        (211)         (190)
                                                         --------      --------

     Net cash provided by financing activities              5,350         2,297
                                                         --------      --------

Net increase (decrease) in cash and cash equivalents         (933)        1,626

Cash and cash equivalents at beginning of period            1,296         1,555
                                                         --------      --------

Cash and cash equivalents at end of period               $    363      $  3,181
                                                         ========      ========


Supplemental disclosure of cash flow information:
     Cash paid for interest                              $    864      $    609
                                                         ========      ========

     Interest capitalized                                $   --        $    103
                                                         ========      ========

















                 See accompanying notes to financial statements.

                                  Page 7 of 17

<PAGE>


                             RANCON REALTY FUND IV,
                        A CALIFORNIA LIMITED PARTNERSHIP

                   Notes to Consolidated Financial Statements

                               September 30, 1996
                                   (Unaudited)

Note 1.           THE PARTNERSHIP AND ITS SIGNIFICANT ACCOUNTING POLICIES

In the opinion of Rancon Financial  Corporation  (RFC) and Daniel Lee Stephenson
(the  Sponsors) and  Glenborough  Inland Realty  Corporation,  the  accompanying
unaudited  financial  statements  contain all  adjustments  (consisting  of only
normal  accruals)  necessary to present fairly the financial  position of Rancon
Realty  Fund  IV, A  California  Limited  Partnership  (the  Partnership)  as of
September  30,  1996 and  December  31,  1995,  and the  related  statements  of
operations  for the three and nine months ended  September 30, 1996 and July 31,
1995,  and changes in partners'  equity and cash flows for the nine months ended
September 30, 1996 and July 31, 1995.

Effective with the year ending  December 31, 1995, the  Partnership's  reporting
year end changed from October 31 to December 31.

Effective  January 1, 1994 the Partnership had contracted with RFC to perform on
the Partnership's behalf,  financial,  accounting,  data processing,  marketing,
legal,  investor  relations,  asset and  development  management  and consulting
services.  These  services  are  subject to the  provisions  of the  Partnership
Agreement.

In December,  1994, RFC entered into an agreement with Glenborough Inland Realty
Corporation  (Glenborough)  whereby  RFC sold to  Glenborough  the  contract  to
perform  the  rights  and  responsibilities   under  RFC's  agreement  with  the
Partnership   and  other   related   Partnerships   (collectively,   the  Rancon
Partnerships)  to perform or contract  on the  Partnership's  behalf  financial,
accounting,  data processing,  marketing,  legal, investor relations,  asset and
development  management and consulting services for the Partnership for a period
of ten years or until the liquidation of the Partnership, whichever comes first.
Pursuant to the contract,  the Partnership will pay Glenborough for its services
as follows: (i) a specified asset administration fee of $993,000 per year, which
is fixed for five years  subject to reduction in the year  following the sale of
assets;  (ii) sales fees of 2% for improved  properties and 4% for land; (iii) a
refinancing fee of 1% and (iv) a management fee of 5% of gross rental  receipts.
As part of this  agreement,  Glenborough  will  perform  certain  tasks  for the
General  Partner of the Rancon  Partnerships  and RFC agreed to  cooperate  with
Glenborough, should Glenborough attempt to obtain a majority vote of the limited
partners  to   substitute   itself  as  the  General   Partner  for  the  Rancon
Partnerships.  This agreement became effective  January 1, 1995.  Glenborough is
not an affiliate of RFC.

As a result of this agreement,  RFC terminated  several of its employees between
December 31, 1994 and February  28,  1995.  Also as a result of this  agreement,
certain of the officers of RFC resigned from their positions  effective February
28, 1995, June 30, 1995 and July 1, 1995.

Consolidation  - In  order  to  satisfy  certain  lender  requirements  for  the
Partnership's  new loan secured by Carnegie  Business  Center I, Service  Retail
Center and Promotional Retail Center (see

                                  Page 8 of 17

<PAGE>


                             RANCON REALTY FUND IV,
                        A CALIFORNIA LIMITED PARTNERSHIP

                   Notes to Consolidated Financial Statements

                               September 30, 1996
                                   (Unaudited)

Note 6), Rancon Realty Fund IV Tri City Limited Partnership,  a Delaware limited
partnership ("RRF IV Tri City") was formed in April,  1996. The three properties
securing the loan were  contributed to RRF IV Tri City by the  Partnership.  The
limited partner of RRF IV Tri-City is the Partnership and the general partner is
Rancon Realty Fund IV, Inc., wholly owned by the Partnership.

Since the  Partnership  indirectly  owns 100% of RRF IV Tri City,  the financial
statements  of RRF  IV  Tri  City  have  been  consolidated  with  those  of the
Partnership.

Reclassification  - Certain 1995 balances have been reclassified to conform with
the current period presentation.

Note 2.           REFERENCE TO 1995 AUDITED FINANCIAL STATEMENTS
                 
These  unaudited  financial  statements  should be read in conjunction  with the
Notes to Financial Statements included in the October 31, 1995 audited financial
statements.

Note 3.           RELATED PARTY TRANSACTIONS

The  Partnership  had an  agreement  with the  Sponsor for  property  management
services through December 31, 1994. The agreement  provided for a management fee
equal to 5% of  gross  rents  collected  while  managing  the  properties.  Fees
incurred under this agreement  totaled $54,000 for the two months ended December
31, 1994. Effective January 1, 1995, the Partnership contracted with Glenborough
to provide these services to the Partnership (see Note 1).

The Partnership incurred $4,000 in program management fees to the Sponsor during
the two months ended  December 31, 1994.  The Sponsor  received this fee for its
management and administration of unimproved or non-income producing  properties.
As a result of the agreement with Glenborough (see Note 1), effective January 1,
1995, this fee is no longer payable to the Sponsor or to Glenborough.

The Partnership  Agreement also provides for the  reimbursement  of actual costs
incurred  by  the  Sponsor  in  providing  certain  administrative,   legal  and
development  services  necessary for the prudent  operation of the  Partnership.
Effective  January 1, 1995,  such services are being  provided by Glenborough as
described in Note 1.

As a result of the agreement  between the RFC and  Glenborough,  RFC  terminated
approximately  82 employees who were  previously  responsible for performing the
administrative,   legal  and  development  services  to  the  Partnership.  Upon
termination,  certain employee costs including severance benefits were allocated
to the various Rancon Partnerships. Such costs allocated to the

                                  Page 9 of 17

<PAGE>


                             RANCON REALTY FUND IV,
                        A CALIFORNIA LIMITED PARTNERSHIP

                   Notes to Consolidated Financial Statements

                               September 30, 1996
                                   (Unaudited)

Partnership aggregated $201,000 and are included in administrative costs for the
nine months ended July 31, 1995.

The remainder of the  reimbursable  costs  incurred by the  Partnership  totaled
$104,000 for the nine months  ended July 31,  1995.  In addition to these costs,
$43,000 was capitalized.

Note 4.           INVESTMENT IN REAL ESTATE

In the second  quarter of 1996,  construction  was  officially  completed on the
Inland  Regional  Center  ("IRC")  project and the tenant  commenced its 13-year
lease. As a result,  $8,431,000 of the IRC  construction  cost was  reclassified
from construction in progress to rental property.

During the first and third quarters of 1996, the Partnership received letters of
intent for leases on two single tenant  retail  buildings to be  constructed  on
3.19 acres of  Tri-City  Corporate  Center in San  Bernardino,  California.  The
Partnership  commenced  preliminary  site planning on the 3.19 acres in 1996 and
accordingly reclassified $990,000 from land held for development to construction
in progress.

On March  26,  1996,  1.3  acres of land in  Temecula,  California  was sold for
$275,000.  The  Partnership's  net sale proceeds,  after reserving  $165,000 for
future  site  improvements,  was  $84,000.  The net  proceeds  were added to the
Partnership's  cash  reserves and will be used to complete  improvements  on the
remaining lots, which are expected to greatly assist  marketing  efforts for the
property.  Since a provision  for  impairment  of  investment in real estate was
established  in  1995,  this  sale  did  not  result  in a gain  or  loss on the
transaction.

Note 5.           COMMITMENTS AND CONTINGENT LIABILITIES

The Partnership is contingently  liable for subordinated real estate commissions
payable to the Sponsor in the amount of  $643,000 at  September  30,  1996.  The
subordinated real estate commissions are payable only after the Limited Partners
have received  distributions  equal to their  original  invested  capital plus a
cumulative  non-compounded  return of six  percent  per annum on their  adjusted
invested capital.

The Partnership is also  contingently  liable for a subordinated note payable in
connection with 12.4 acres of land in Temecula, California, that the Partnership
reacquired in June 1992 through a deed in lieu of foreclosure in satisfaction of
a $2,276,000 note receivable held by the Partnership  that had gone into default
during 1991. The  subordinated  note payable and accrued interest total $489,000
as of September  30, 1996.  This amount is payable upon the sale of the property
only after the Partnership receives the full amount of the prior note receivable
with

                                  Page 10 of 17

<PAGE>


                             RANCON REALTY FUND IV,
                        A CALIFORNIA LIMITED PARTNERSHIP

                   Notes to Consolidated Financial Statements

                               September 30, 1996
                                   (Unaudited)

accrued and unpaid  interest,  costs of  development,  costs of sale,  and other
amounts paid to obtain good title to the  property,  subject to certain  release
provisions.

Note 6.           NOTES PAYABLE

On  April  19,  1996,  the  Partnership  obtained  new  permanent  financing  of
$6,500,000,  secured by real estate  referred to as Carnegie  Business Center I,
Service Retail Center and Promotional Retail Center. After disbursing $5,620,000
for the payoff of the existing Far East National  Bank,  Chino Valley Bank,  and
Imperial   Bank  loans,   $232,000   in  loan  fees  and  funding   $200,000  in
reserves/escrow,  the Partnership netted $448,000 in refinancing  proceeds.  The
net  proceeds  were added to the  Partnership's  cash  reserves  for future site
improvements.

The new loan is a  10-year  fixed  rate loan  with a  25-year  amortization  and
matures on May 1, 2006. The loan accrues  interest at a rate of 8.744% per annum
with $53,413 of principal and interest payments due monthly,  commencing June 1,
1996.

On May 14, 1996, the Partnership  obtained a $2,500,000  construction  loan from
Citizens  Business  Bank,  secured  by the IRC  building  in order  to  complete
construction  of the building.  As of September 30, 1996,  the  Partnership  had
drawn the entire  $2,500,000  available  and completed  construction  of the IRC
building.

The loan is a five year fixed rate loan due April 23, 2001, accruing interest at
the rate of 8.75% per annum.  Monthly  payments  of  interest  only were due for
three months  commencing May 23, 1996.  Beginning  August 23, 1996,  payments of
$20,771 in principal and interest are due monthly.

                                  Page 11 of 17

<PAGE>



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

LIQUIDITY AND CAPITAL RESOURCES

As of July, 1987,  Rancon Realty Fund IV (the Partnership) was fully funded from
the sale of all limited  partnership  units in the amount of $72,556,000 (net of
selling  and  organization  expenses).  As of  September  30,  1996,  after  the
Partnership  has spent  $5,499,000  in 1996 on the  construction  of the  Inland
Regional Center  building ("IRC  building") and $1,324,000 on other additions to
real estate, the Partnership had cash of $363,000 and $50,134,000 in real estate
investments, net of accumulated depreciation.

The Partnership's primary sources of funds consist of the proceeds of its public
offering of limited  partnership  units,  new financing and cash provided by its
rental  activities.  Other sources of funds include  property sales and interest
income on other deposits of funds invested temporarily, pending their use in the
development of properties.

A majority  of the  Partnership's  assets are located  within the Inland  Empire
submarket of the Southern  California region. The Southern  California  regional
economy in general,  and the real estate industry in particular,  are considered
to be in a recessionary  cycle.  The  Partnership  may realize both positive and
negative  effects  from these  current  market  conditions.  Potential  negative
effects  include the  delinquency  of lease and  mortgage  payments  owed to the
Partnership  and a decrease in  competitive  market lease rates and land prices,
and an inability  to obtain  financing  for further  property  development.  The
Partnership may benefit from the current  economic and financing  conditions due
to the general lack of new competitive  product being  constructed,  potentially
causing greater absorption of existing inventory.

The  Partnership  currently  owns  the  following  properties  in  the  Tri-City
Corporate  Center  area  within  the Inland  Empire  submarket  of the  Southern
California region:

     Property                              Type                Square Feet
One Vanderbilt                           Office                  73,800
Two Vanderbilt                           Office                  69,100
Service Retail Center                    Commercial              20,800
Carnegie Business Center                 Office                  62,600
Promotional Retail Center-Phase I        Commercial              66,300
Inland Regional Center                   Office                  81,100

With the  signing  of a  13-year  lease  with  Inland  Regional  Center  and the
completion  of  construction  of the 81,000  square foot IRC building  discussed
above,  the  Partnership now has nine operating  properties  within the Tri-City
project in San Bernardino,  California with approximately 373,000 total leasable
square feet.

The  Partnership  also owns  approximately  55 acres of  unimproved  land in the
Tri-City area.

Additionally, the Partnership currently owns the Shadowridge Woodbend Apartments
(240 unit apartment complex) in Vista, California plus approximately 54 acres of
unimproved land in Riverside County, California.

                                  Page 12 of 17

<PAGE>




Prepaid  expenses and other assets increased 23% or $133,000 as of September 30,
1996 from  December  31, 1995  largely as a result of the $53,000  remaining  in
escrow for further site improvements from the March, 1996, 1.3 acre land sale in
Temecula, California and an increase in property tax impounds.

Accounts payable and accrued expenses  increased  approximately  54% or $192,000
from  December 31, 1995 to September  30, 1996  primarily  due to an increase in
accrued  property  taxes  payable.  These  property  taxes are due to be paid in
December,  1996 partially from the property tax impounds discussed above and the
difference from operating cash flow.

On April 19, 1996,  the  Partnership  borrowed  $6,500,000  under new  permanent
financing.  The loan is a 10-year  fixed rate loan with a 25-year  amortization,
bearing  interest  at 8.744%  per annum  with  monthly  principal  and  interest
payments of $53,413. The loan proceeds were used to payoff three existing loans.
After paying  refinancing and other fees, and placing funds in escrow for tenant
improvements  for  the  Promotional   Retail  Center,   the  Partnership  netted
approximately  $465,000 in proceeds. In addition to the financing proceeds,  the
Partnership  benefitted from the extension of the weighted  average  maturity of
the three  existing  loans from 1.75 years to 10 years on the new loan,  and the
reduction of the weighted average interest rate from 9.72% to 8.74%.

On May 14,  1996,  the  Partnership  obtained a  $2,500,000  construction  loan,
secured by the IRC building.  This loan required  monthly interest only payments
at a rate of 8.75% per annum  through  July 23,  1996 at which  time  $20,771 in
principal and interest payments commence through its April 23, 2001 maturity. As
of September 30, 1996, the entire $2,500,000 has been drawn by the Partnership.

Offsite  improvements  remain on hold at Lake Elsinore  Square in Lake Elsinore,
California  pending recovery of the housing market. The tentative parcel map has
been approved and the final map was being  processed  when further  activity was
put on hold. Subsequently, the tentative parcel map expired.

There has been no  development of the Perris  property to date. The  Partnership
continues  to  market  the  property  for sale to retail  users  and  interested
developers.

The 12.4 acre property in Temecula, California has been divided into 12 separate
parcels  via a parcel  map  approved  December,  1995.  Final map  approval  was
received January 2, 1996. In March, 1996, the Partnership executed the sale of a
1.3 acre parcel. The Partnership's net sale proceeds,  after allocating $165,000
for future site improvements,  was $84,000.  The proceeds from this sale will be
used to complete improvements on the remaining lots, which should greatly assist
marketing  efforts of such property.  As of September 30, 1996,  $112,000 of the
$165,000 has been spent,  leaving $53,000 still available for future improvement
costs.

Portions of the  property at Tri-City  sold during  fiscal  1989,  1991 and 1993
included lots 8 and 9, the Chili's and TGI Friday's  restaurants  and a 1.5 acre
fire station site. The  Partnership  continues to hold a note  receivable in the
amount of  $405,000  related  to the sale of the TGI  Friday's  restaurant.  The
Partnership  does not  anticipate  the sale of any  significant  portion  of the
balance  of the  Tri-City  property  (except  the Land  fill)  until  after  the
completion  of  development   of  such  property  or  the   liquidation  of  the
Partnership. Any cash generated from property sales

                                  Page 13 of 17

<PAGE>



may be utilized in the  development  of other  properties or  distributed to the
partners.  The General  Partners  continue  to assess the real estate  market in
Southern  California in an effort to determine an appropriate time to dispose of
the Partnership's assets.

Aside from the  foregoing,  the  Partnership  knows of no demands,  commitments,
events,  or uncertainties  which might affect its liquidity or capital resources
in any material respect.  The effect of inflation on the Partnership's  business
should be no greater than its effect on the economy as a whole.

Management  believes that the Partnership's cash balance and prepaid expenses as
of September 30, 1996, together with cash from operations, will be sufficient to
finance  the  Partnership's  and  the  properties'   continued   operations  and
development plans.

RESULTS OF OPERATIONS

The  Partnership's  reporting  year  end has been  changed  from  October  31 to
December 31. Since the  Partnership's  operations are not seasonal,  comparisons
will reflect the three and nine months ended September 30, 1996 versus the three
and nine months ended July 31, 1995.

Rental income for the nine months ended September 30, 1996 decreased $799,000 or
18% from the nine  months  ended  July 31,  1995,  primarily  as a result of the
November,  1995  vacancy  upon lease  expiration  of one  tenant,  Aetna  Health
Management  ("Aetna"),  who occupied an aggregate of 74,000 square feet of space
at One Vanderbilt,  Two Vanderbilt and Carnegie Business Center I. This caused a
decrease  in average  occupancy,  as further  detailed  in the table of Tri-City
properties  below.  Aetna's  vacancy was  primarily  a function of the  tenant's
desire to consolidate its various spaces into one building.

Occupancy  rates at the  Partnership's  Tri-City  properties as of September 30,
1996 and July 31, 1995 were as follows:
                                               September 30,       July 31,
                                                    1996             1995

      One Vanderbilt                                  64%               72%
      Two Vanderbilt                                  25%               97%
      Service Retail Center                          100%               90%
      Carnegie Business Center I                      87%               97%
      Promotional Retail Center-Phase I               97%               94%
      Inland Regional Center                         100%               ---
            (commencing June, 1996)

As of September 30, 1996,  there are five tenants that in the aggregate,  occupy
approximately  178,000 square feet or 48% of the 374,000 total  leasable  square
feet of the Tri-City  properties.  The Partnership has positioned itself well in
respect to the timing of lease  expirations,  as these five  tenants have leases
that expire at various dates between 1997 and 2009.

Management is currently in negotiations on a new lease with one potential tenant
for 19,000 square feet of space.  Management  is also  negotiating a lease for a
38,000 square foot build-to- suit retail building on vacant land in Tri-City.

                                  Page 14 of 17

<PAGE>




Interest and other income  increased  $21,000 for both the three and nine months
ended  September 30, 1996 over the three and nine months ended July 31, 1995 due
to the receipt of a partial  payment from a negotiated  settlement with a former
tenant in September, 1996.

Operating expenses (expenses  applicable to rental operations) for the three and
nine months ended  September 30, 1996 decreased  $84,000 and $232,000 or 13% and
12%,  respectively,  from the  three and nine  months  ended  July 31,  1995 due
primarily to: (i) lowered  utility costs and  management  fees  associated  with
decreased  occupancy from July 31, 1995 to September 30, 1996,  discussed above;
and (ii) net property tax refunds,  after appeal fees, as a result of successful
tax appeals.

Interest  expense  for the  three  and nine  months  ended  September  30,  1996
increased  $181,000  and  $434,000 or 87% and 81% from the three and nine months
ended July 31, 1995,  respectively,  primarily as a result of the new $6,500,000
financing   discussed  above  and  the  additional  notes  payable  obtained  to
facilitate construction in 1995 and 1996.

Depreciation  and amortization for the three and nine months ended September 30,
1996  decreased  $142,000  and  $147,000  or 34% and 13% from the three and nine
months  ended  July 31,  1995,  respectively,  as a result  of fully  amortizing
leasing  commissions  paid in connection  with a tenants' early vacancy of their
space in the One Vanderbilt building in the third quarter of fiscal year 1995.

Expenses  associated with undeveloped land increased  $81,000 and $72,000 or 39%
and 12% for the three and nine months  ended  September  30, 1996 over the three
and  nine  months  ended  July  31,  1995  due  to an  increase  in  maintenance
association dues and property taxes on the undeveloped land.

General and  administrative  expenses during the nine months ended September 30,
1996  decreased  $160,000 or 15% from the nine months ended July 31, 1995.  This
decrease is  primarily  the result of a one-time  payment of  severance to RFC's
terminated employees in the nine months ended July 31, 1995.


                                  Page 15 of 17

<PAGE>



Part II.          OTHER INFORMATION


Item 1.  Legal Proceedings

                  None.

Item 2.  Changes in Securities

                  Not applicable.

Item 3.  Defaults Upon Senior Securities

                  Not applicable.

Item 4.  Submission of Matters to a Vote of Security Holders

                  None.

Item 5.  Other Information

                  None.

Item 6.  Exhibits and Reports on Form 8-K

                  (a)  Exhibits:

                  #27 - Financial Data Schedule

                  (b)  Reports on Form 8-K:

                  None.

                                  Page 16 of 17

<PAGE>


                                   SIGNATURES



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


                                       RANCON REALTY FUND IV,
                                       a California Limited Partnership
                                       (Registrant)




Date: November 13, 1996                 By:/s/ Daniel L. Stephenson
                                           Daniel L. Stephenson, General Partner
                                           and Director, President,
                                           Chief Executive Officer and
                                           Chief Financial Officer of
                                           Rancon Financial Corporation,
                                           General Partner of
                                           Rancon Realty Fund IV,
                                           a California Limited Partnership


                                  Page 17 of 17