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

                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

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

                                   FORM 10-Q

<TABLE>
<C>        <S>
   /X/     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934
</TABLE>

                FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2000 OR

<TABLE>
<C>        <S>
   / /     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934
</TABLE>

        FOR THE TRANSITION PERIOD FROM ______________ TO ______________

                         COMMISSION FILE NUMBER 0-12138

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

               NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP

             (Exact Name of Registrant as Specified in Its Charter)

<TABLE>
<S>                                   <C>
        MASSACHUSETTS                      04-2619298(I.R.S. Employer
 (State or Other Jurisdiction                 Identification No.)
     of Incorporation or
        Organization)
</TABLE>

                39 BRIGHTON AVENUE, ALLSTON, MASSACHUSETTS 02134
              (Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, Including Area Code            (617) 783-0039

                                   NOT APPLICABLE
   (Former Name, Former Address and Former Fiscal Year, if Changed Since Last
                                    Report)

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

    Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes /X/  No / /

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>
            NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP INDEX

<TABLE>
<CAPTION>
                                                                PAGE
                                                              --------
<S>                                                           <C>
PART I--FINANCIAL INFORMATION

  Consolidated Balance Sheets as of June 30, 2000 and
    December 31, 1999.......................................         2

  Consolidated Statements of Income for the Three Months
    Ended June 30, 2000 and June 30, 1999 and the Six
    Months Ended June 30, 2000 and June 30, 1999............         3

  Consolidated Statement of Changes in Partners' Capital....         4

  Consolidated Statements of Cash Flows for the Six Months
    Ended June 30, 2000 and June 30, 1999...................         5

  Condensed Notes to Consolidated Financial Statements......         6

  Management's Discussion and Analysis of Financial
    Condition and Results of Operations.....................        14

PART II--OTHER INFORMATION

  Signatures................................................        18
</TABLE>

                                       1
<PAGE>
       NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

                          CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                               JUNE 30,
                                                                 2000       DECEMBER 31,
                                                              (UNAUDITED)       1999
                                                              -----------   ------------
<S>                                                           <C>           <C>
                           ASSETS
Rental Properties...........................................  $75,451,929   $81,274,293
Cash and Cash Equivalents...................................    4,179,656     1,244,438
Short-term Investments......................................       22,834        21,787
Rents Receivable............................................      683,534       686,706
Real Estate Tax Escrows.....................................      737,504       706,974
Prepaid Expenses and Other Assets...........................    2,956,664     2,113,495
Investment in Joint Venture.................................       16,425        29,035
Financing and Leasing Fees..................................      980,866     1,110,520
Mortgage Notes Receivable...................................            0       480,872
                                                              -----------   -----------
      TOTAL ASSETS..........................................  $85,029,412   $87,668,120
                                                              ===========   ===========
             LIABILITIES AND PARTNERS' CAPITAL
Note Payable................................................  $         0   $   750,000
Mortgages Payable...........................................   74,224,304    77,530,651
Accounts Payable and Accrued Expenses.......................    1,177,377     1,103,458
Advance Rental Payments and Security Deposits...............    2,839,685     2,646,350
                                                              -----------   -----------
      Total Liabilities.....................................   78,241,366    82,030,459
Commitments and Contingent Liabilities (Note 9)
Partners' Capital
  173,252 units outstanding in 2000 and 1999................    6,788,046     5,637,661
                                                              -----------   -----------
TOTAL LIABILITIES AND PARTNERS' CAPITAL.....................  $85,029,412   $87,668,120
                                                              ===========   ===========
</TABLE>

                 See notes to consolidated financial statements

                                       2
<PAGE>
       NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSIP AND SUBSIDIARIES

                       CONSOLIDATED STATEMENTS OF INCOME

                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                 THREE MONTHS ENDED          SIX MONTHS ENDED
                                                      JUNE 30,                   JUNE 30,
                                               -----------------------   ------------------------
                                                  2000         1999         2000          1999
                                               ----------   ----------   -----------   ----------
<S>                                            <C>          <C>          <C>           <C>
Revenues
  Rental income..............................  $6,461,321   $4,824,390   $12,838,383   $9,602,588
  Laundry and sundry income..................      67,891       42,013       127,074       72,047
                                               ----------   ----------   -----------   ----------
                                                6,529,212    4,866,403    12,965,457    9,674,635
                                               ----------   ----------   -----------   ----------
Expenses
  Administrative.............................     285,647      246,266       600,422      536,190
  Depreciation and amortization..............   1,172,308      876,814     2,330,874    1,731,306
  Interest...................................   1,569,774    1,197,794     3,165,151    2,360,629
  Management Fees............................     271,925      206,589       553,983      413,369
  Operating..................................     552,702      349,531     1,408,208    1,006,094
  Renting....................................      62,328       76,513       105,488      128,267
  Repairs and maintenance....................     759,993      661,950     1,392,036    1,222,261
  Taxes and insurance........................     657,843      475,258     1,321,852      985,980
                                               ----------   ----------   -----------   ----------
                                                5,332,520    4,090,715    10,878,014    8,384,096
                                               ----------   ----------   -----------   ----------
Income from Operations.......................   1,196,692      775,688     2,087,443    1,290,539
                                               ----------   ----------   -----------   ----------
Other Income(Loss)
  Interest income............................      32,097      117,747        72,171      176,069
  Income from investment in joint venture....      11,228        9,299        17,822       14,230
  Unrealized appreciation (depreciation) in
    investment...............................         (20)    (206,594)          426     (269,629)
  Gain on the sale of real estate............     546,568      676,124       546,568      676,124
                                               ----------   ----------   -----------   ----------
                                                  589,873      596,576       636,987      596,794
                                               ----------   ----------   -----------   ----------
Net Income...................................  $1,786,565   $1,372,264   $ 2,724,430   $1,887,333
                                               ==========   ==========   ===========   ==========
Net Income per Unit..........................  $    10.31   $     7.92   $     15.73   $    10.89
                                               ==========   ==========   ===========   ==========
Weighted Average Number of Units
  Outstanding................................     173,252      173,252       173,252      173,252
                                               ==========   ==========   ===========   ==========
</TABLE>

                 See notes to consolidated financial statements

                                       3
<PAGE>
       NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

             CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' CAPITAL

                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                       LIMITED
                                               ------------------------     GENERAL
                                                 CLASS A      CLASS B     PARTNERSHIP      TOTAL
                                               -----------   ----------   -----------   -----------
<S>                                            <C>           <C>          <C>           <C>
Balance, January 1, 1999.....................  $ 3,414,571   $  814,416     $42,893     $ 4,271,880
Distribution to Partners.....................   (1,120,858)    (266,204)    (14,011)     (1,401,073)
Net Income...................................    1,509,866      358,593      18,874       1,887,333
                                               -----------   ----------     -------     -----------
Balance, June 30, 1999.......................  $ 3,803,579   $  906,805     $47,756     $ 4,758,140
                                               ===========   ==========     =======     ===========
Units authorized and issued, net of 6,973
  Treasury Units at June 30, 1999............      138,602       32,918       1,732         173,252
                                               ===========   ==========     =======     ===========
Balance, January 1, 2000.....................  $ 4,510,129   $1,071,156     $56,376     $ 5,637,661
Distribution to Partners.....................   (1,259,236)    (299,069)    (15,740)     (1,574,045)
Net Income...................................    2,179,544      517,642      27,244       2,724,430
                                               -----------   ----------     -------     -----------
Balance, June 30, 2000.......................  $ 5,430,437   $1,289,729     $67,880     $ 6,788,046
                                               ===========   ==========     =======     ===========
Units authorized and issued, net of 6,973
  Treasury Units at June 30, 2000............      138,602       32,918       1,732         173,252
                                               ===========   ==========     =======     ===========
</TABLE>

                 See notes to consolidated financial statements

                                       4
<PAGE>
       NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF CASH FLOWS

                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                   SIX MONTHS ENDED
                                                                       JUNE 30,
                                                              --------------------------
                                                                 2000           1999
                                                              -----------   ------------
<S>                                                           <C>           <C>
Cash Flows from Operating Activities
  Net income................................................  $ 2,724,430   $  1,887,333
                                                              -----------   ------------
Adjustments to reconcile net income to net cash provided by
  operating activities
  Depreciation and amortization.............................    2,330,874      1,731,306
  (Income) from investments in partnerships and joint
    venture.................................................      (17,822)       (14,230)
  Gain on the sale of rental property.......................     (546,568)      (676,124)
  (Appreciation) depreciation on short-term investments.....         (426)       269,629
  Decrease in rents receivable..............................        3,172         37,732
  (Increase) in financing and leasing fees..................      (37,414)      (230,149)
  Increase in accounts payable..............................       73,919        235,700
  (Increase) Decrease in real estate tax escrow.............      (30,530)        21,219
  (Increase) in prepaid expenses and other assets...........     (843,169)      (407,092)
  Increase in advance rental payments and security
    deposits................................................      193,345        400,393
  (Increase) decrease in notes receivable...................      480,782       (480,782)
                                                              -----------   ------------
  Total Adjustments.........................................    1,606,163        887,602
                                                              -----------   ------------
Net cash provided by operating activities...................    4,330,593      2,774,935
                                                              -----------   ------------
Cash Flows from Investing Activities
  Distribution from joint venture...........................       30,432         27,480
  Purchase and improvement of rental properties.............     (601,130)    (9,213,149)
  Maturity of short-term investments........................            0      2,033,832
  Purchase of short-term investment.........................            0     (4,594,918)
  Net proceeds from the sale of rental property.............    4,805,715        850,000
Net cash provided by (used in) investing activities.........    4,235,017    (10,896,755)
                                                              -----------   ------------
Cash Flows from Financing Activities Payment of notes
  payable...................................................     (750,000)            --
  Principal payments and early repayment of mortgages
    payable.................................................   (3,306,347)      (482,540)
  Distributions to partners.................................   (1,574,045)    (1,401,073)
  Proceeds from the refinancing.............................            0      5,283,025
  Proceeds from notes payable...............................            0      5,244,113
                                                              -----------   ------------
Net cash provided by (used in) financing activities.........   (5,630,392)     8,643,525
                                                              -----------   ------------
Net Increase in Cash and Cash Equivalents...................    2,935,218        521,705
Cash and Cash Equivalents, Beginning........................    1,244,438        623,078
                                                              -----------   ------------
Cash and Cash Equivalents, Ending...........................  $ 4,179,656   $  1,144,783
                                                              ===========   ============
</TABLE>

                 See notes to consolidated financial statements

                                       5
<PAGE>
       NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                  (UNAUDITED)

NOTE 1--SIGNIFICANT ACCOUNTING POLICIES

    LINE OF BUSINESS: New England Realty Associates Limited Partnership ("NERA"
or the "Partnership") was organized in Massachusetts during 1977. NERA and its
subsidiaries own and operate various residential apartment buildings,
condominium units, and commercial properties located in Massachusetts,
Connecticut and New Hampshire. NERA has also made investments in other real
estate partnerships and has participated in other real estate-related
activities, primarily located in Massachusetts. In connection with the mortgages
referred to in Note 5, a substantial number of NERA's properties were
restructured into separate subsidiary limited partnerships without any change in
the historical cost basis.

    PRINCIPLES OF CONSOLIDATION: The consolidated financial statements include
the accounts of NERA and its subsidiary limited partnerships. NERA has a 99.67%
ownership interest in each of such subsidiary limited partnerships. The
consolidated group is referred to as the "Partnerships." Minority interests are
not recorded since they are insignificant. All significant intercompany accounts
and transactions are eliminated in consolidation. The Partnership accounts for
its investment in a joint venture on the equity method.

    ACCOUNTING ESTIMATES: The preparation of the financial statements is in
accordance with generally accepted accounting principles (GAAP) requiring
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosures of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reported period. Accordingly, actual results could differ
from those estimates.

    REVENUE RECOGNITION: Rental income from residential and commercial
properties is recognized over the term of the related lease. Amounts 60 days in
arrears are charged against income. Certain leases of the commercial properties
provide for increasing stepped minimum rents, which are accounted for on a
straight-line basis over the term of the lease.

    RENTAL PROPERTIES: Rental properties are stated at cost less accumulated
depreciation. Maintenance and repairs are charged to expense as incurred;
improvements and additions are capitalized. When assets are retired or otherwise
disposed of, the cost of the asset and related accumulated depreciation is
eliminated from the accounts, and any gain or loss on such disposition is
included in income. Rental properties are depreciated on the straight-line
method over their estimated useful lives. In the event that facts and
circumstances indicate that the carrying value of rental properties may be
impaired, an analysis of recoverability is performed. The estimated future
undiscounted cash flows are compared to the asset's carrying value to determine
if a write-down to fair value or discounted cash flow value is required.

    FINANCING AND LEASING FEES: Financing fees are capitalized and amortized,
using the interest method, over the life of the related mortgages. Leasing fees
are capitalized and amortized on a straight-line basis over the life of the
related lease.

    INCOME TAXES: The financial statements have been prepared under the basis
that NERA and its subsidiaries are entitled to tax treatment as partnerships.
Accordingly, no provision for income taxes on income has been recorded.

                                       6
<PAGE>
       NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

        CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                  (UNAUDITED)

NOTE 1--SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
    CASH EQUIVALENTS: The Partnerships consider cash equivalents to be all
highly liquid instruments purchased with a maturity of three months or less.

    SHORT-TERM INVESTMENTS: The Partnership accounts for short-term investments
in accordance with Statement of Financial Accounting Standards (FAS) No. 115
"Accounting for Certain Investments in Debt and Equity Securities." The
Partnerships consider short-term investments to be mutual funds and bank
certificates of deposit, Treasury obligations, or commercial paper with initial
maturities between three and twelve months. These investments are considered to
be trading account securities and are carried at fair value with unrealized
holding gains or losses reflected in earnings.

    CONCENTRATION OF CREDIT RISKS AND FINANCIAL INSTRUMENTS: The Partnerships'
tenants are located in New England, and the Partnerships are subject to the
general economic risks related thereto. No single tenant accounted for more than
5% of the Partnerships' revenues in 2000 or 1999. The Partnerships make their
temporary cash investments with high-credit-quality financial institutions or
purchase money market accounts invested in U.S. Government securities or mutual
funds invested in government bonds. At June 30, 2000 approximately $3,900,000 of
cash and cash equivalents exceeded federally insured amounts. The mutual fund
investment of $22,834 at June 30, 2000 is subject to price volatility associated
with any interest-bearing investment. Fluctuations in actual interest rates
affect the value of these investments.

    ADVERTISING EXPENSE: Advertising is expensed as incurred. Advertising
expense was $41,383, and $30,409 for the six months ended June 30, 2000 and
1999, respectively.

                                       7
<PAGE>
       NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

        CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                  (UNAUDITED)

NOTE 2--RENTAL PROPERTIES

    Rental properties consist of the following:

<TABLE>
<CAPTION>
                                                          JUNE 30,      DECEMBER,      USEFUL
                                                            2000          1999          LIFE
                                                         -----------   -----------   -----------
<S>                                                      <C>           <C>           <C>
Land, improvements, and parking lots...................  $15,951,390   $16,992,349   10-31 years
Buildings and improvements.............................   78,594,402    82,422,016   15-31 years
Kitchen cabinets.......................................    1,310,427     1,218,362    5-10 years
Carpets................................................    1,299,643     1,232,720    5-10 years
Air conditioning.......................................      201,790       279,807    7-10 years
Laundry equipment......................................       53,672        53,672     5-7 years
Elevators..............................................      161,392       161,391      20 years
Swimming pools.........................................       60,850        42,450      10 years
Equipment..............................................      904,874       845,009     5-7 years
Motor vehicles.........................................      100,655        65,927       5 years
Fences.................................................       37,563        36,717    5-10 years
Furniture and fixtures.................................      464,965       438,548     5-7 years
Smoke alarms...........................................       35,469        33,917     5-7 years
                                                         -----------   -----------
                                                          99,177,092   103,822,885
Less accumulated depreciation..........................   23,725,163    22,548,592
                                                         -----------   -----------
                                                         $75,451,929   $81,274,293
                                                         ===========   ===========
</TABLE>

    On June 28, 2000 the Partnership sold the Lewiston Mall Shopping Center,
located in Lewiston, Maine. The property was sold for $5,100,000 and the gain of
$546,568 on the sale is included in other income.

NOTE 3--RELATED PARTY TRANSACTIONS

    The Partnerships' properties are managed by an entity which is owned by the
majority shareholder of the General Partner. The management fee is equal to 4%
of rental revenue and laundry income. Total fees paid were approximately
$541,000 and approximately $401,000 for the six months ended June 30, 2000 and
1999, respectively. Security deposits are held in escrow by the management
company (see Note 6). The management company also receives a mortgage servicing
fee equal to an annual rate of 1/2% of the monthly outstanding balance of
mortgages receivable resulting from the sale of property. There was a mortgage
servicing fee of $122 paid in the six months ended June 30, 2000 and $325 paid
in the year ended December 31, 1999.

    The Partnership Agreement also permits the General Partner or management
company to charge the costs of professional services (such as counsel,
accountants, and contractors) to NERA which would otherwise be paid to a third
party for professional services. During the six months ended June 30, 2000 and
1999, approximately $369,000 and $359,000 was charged to NERA for legal,
construction, maintenance, rental and architectural services and supervision of
capital improvements. Approximately $138,000 and $141,000 was capitalized during
the six months ended June 30, 2000 and 1999 in rental properties. Included in
the 2000 expenses referred to above, approximately $91,000 is recorded in
repairs and maintenance, $87,000 in administrative expense and approximately
$16,000 is included in

                                       8
<PAGE>
       NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

        CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                  (UNAUDITED)

NOTE 3--RELATED PARTY TRANSACTIONS (CONTINUED)
renting expense. Included in the 1999 expenses referred to above, approximately
$100,000 is recorded in repairs and maintenance, $80,000 in administrative
expense and approximately $5,000 is included in renting expense. Additionally in
each of the six months ended June 30, 2000 and 1999, the Partnership paid to the
management company $37,350 and $32,500 respectively for in-house accounting
services, which were previously provided by an outside company. The Partnership
Agreement entitles the General Partner or the management company to receive
certain commissions upon the sale of Partnership property only to the extent
that total commissions do not exceed 3%. In connection with the sale of the
Lewiston Mall Shopping Center, the Partnership paid a commission of $153,000 to
the management company in June 2000. No such commissions were paid in 1999.

    In 1996, prior to becoming an employee and President of The Hamilton
Company, the current President performed and continues to perform asset
management consultancy services to the Partnership. This individual continues to
receive asset management fees from the Partnership, receiving $20,000 during the
six months ended June 30, 2000 and $32,650 during the year ended December 31,
1999.

    Included in prepaid expenses and other assets were amounts due from related
parties of $1,016,283 at June 30, 2000 and $937,157 at December 31, 1999
representing Massachusetts tenant security deposits which are held for the
Partnerships by another entity also owned by one of the shareholders of the
General Partner (see Note 6).

    See Note 10 for rental arrangements with Timpany Plaza joint venture. As
described in Note 4, the Partnership had interests in certain entities in which
the majority shareholder of the General Partner is also involved.

    On December 22, 1999, the Partnership borrowed $750,000 from the majority
shareholder of the General Partner. This amount was paid directly to the seller
of the Oak Apartments in Brockton, Massachusetts. This unsecured 10% note was
due on December 22, 2001 or prepayable without penalty. Interest expense on this
note was $20,000 for the period ended April 6, 2000 and $2,083 for the period
ending December 31, 1999. On April 6, 2000, this note was paid in full to the
majority shareholder of the General Partner.

NOTE 4--OTHER ASSETS

    Short-term investments are considered to be trading securities per FAS No.
115 and are carried on the balance sheet at their fair value. At June 30, 2000
mutual fund investments with a cost of $22,408 was recorded at a market value of
$22,834. At June 30, 1999 mutual fund investments with a cost of $5,414,481, was
recorded at a market value of $5,144,852.

    Included in prepaid expenses and other assets at June 30, 2000 and
December 31, 1999 is approximately $690,000 and $456,000 respectively, held in
escrow to pay future capital improvements.

    The carrying value of the Partnership's 50% interest in the Timpany Plaza
joint venture, at equity, is $16,425 and $29,035 at June 30, 2000 and
December 31, 1999 respectively.

    Financing and leasing fees of $980,866 and $1,110,520 are net of accumulated
amortization of $1,428,216 and $1,261,148 at June 30, 2000 and December 31,
1999, respectively.

                                       9
<PAGE>
       NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

        CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                  (UNAUDITED)

NOTE 5--MORTGAGES PAYABLE

    At June 30, 2000 and December 31, 1999, the mortgages payable consisted of
various loans, substantially all of which were secured by first mortgages on
properties referred to in Note 2. At June 30, 2000 the interest rate on these
loans ranged from 6.52% to 9.25%, payable in monthly installments aggregating
approximately $589,000 including interest, to various dates through 2017.
Although the majority of loans mature within ten years, they are being amortized
on a basis between 25 and 27.5 years. The carrying amounts of the Partnerships'
mortgages payable approximate their fair value. The majority of the mortgages
are subject to prepayment penalties.

    The Partnerships have pledged tenant leases as additional collateral for
certain of these mortgages.

    Approximate annual maturities at June 30, 2000 are as follows:

<TABLE>
<S>                                                           <C>
2001--current maturities....................................  $   791,000
2002........................................................      855,000
2003........................................................      924,000
2004........................................................      995,000
2005........................................................    1,080,000
Thereafter..................................................   69,579,000
                                                              -----------
                                                              $74,224,000
                                                              ===========
</TABLE>

    The above maturity schedule reflects the refinancings described in note 14,
subsequent events.

NOTE 6--ADVANCE RENTAL PAYMENTS AND SECURITY DEPOSITS

    The lease agreements for certain properties require tenants to maintain a
one-month advance rental payment plus security deposits. Security deposits are
held in escrow by another entity owned by the majority shareholder of the
General Partner (see Note 3).

NOTE 7--PARTNERS' CAPITAL

    The Partnership has two categories of limited partners (Class A and B) and
one category of General Partner (General Partner). Under the terms of the
Partnership Agreement, Class B units and General Partnership units must
represent 19% and 1% respectively of the total units outstanding. All classes
have equal profit-sharing and distribution rights in proportion to their
ownership interests.

    In January 2000, the Partnership declared a semi-annual dividend of $5.10
per unit and a special dividend of $4.00 per unit payable March 31, 2000. The
Partnership declared distributions of $13.20 per unit in 1999. The 1999
distribution included a special dividend of $3.50 per unit paid in March 1999.

    The Partnership has entered into a deposit agreement with an agent to
facilitate public trading of limited partners' interests in Class A units. Under
the terms of this agreement, the holders of Class A

                                       10
<PAGE>
       NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

        CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                  (UNAUDITED)

NOTE 7--PARTNERS' CAPITAL (CONTINUED)
units have the right to exchange each Class A unit for 10 Depositary Receipts.
The following is information on the net income per Depositary Receipt:

<TABLE>
<CAPTION>
                                                                  SIX MONTHS
                                                                     ENDED
                                                                   JUNE 30,
                                                              -------------------
                                                                2000       1999
                                                              --------   --------
<S>                                                           <C>        <C>
Net Income per Depositary Receipt...........................   $1.57      $1.09
                                                               =====      =====
</TABLE>

NOTE 8--TREASURY UNITS

    Treasury units at June 30, 2000 are as follows:

<TABLE>
<S>                                                           <C>
Class A.....................................................   5,681
Class B.....................................................   1,228
General Partnership.........................................      64
                                                               -----
                                                               6,973
                                                               =====
</TABLE>

NOTE 9--COMMITMENTS AND CONTINGENCIES

    From time to time, the Partnerships are involved in various ordinary routine
litigation incidental to their business. The Partnerships are not involved in
any material pending legal proceedings.

NOTE 10--RENTAL INCOME

    During the six months ended June 30, 2000, approximately 83% of rental
income was related to residential apartments and condominium units with leases
of one year or less. The remaining 17% was related to commercial properties
which have minimum future rental income on noncancellable operating leases as
follows:

<TABLE>
<CAPTION>
                                                         COMMERCIAL
                                                          PROPERTY
YEAR ENDED JUNE 30                                         LEASES      LAND LEASES      TOTAL
------------------                                       -----------   -----------   -----------
<S>                                                      <C>           <C>           <C>
2001...................................................  $ 1,945,000   $  150,000    $ 2,095,000
2002...................................................    1,840,000      150,000      1,990,000
2003...................................................    1,729,000      150,000      1,879,000
2004...................................................    1,696,000      150,000      1,846,000
2005...................................................    1,330,000      155,000      1,485,000
Thereafter.............................................    8,909,000      720,000      9,629,000
                                                         -----------   ----------    -----------
                                                         $17,449,000   $1,475,000    $18,924,000
                                                         ===========   ==========    ===========
</TABLE>

    The aggregate minimum future rental income does not include contingent
rentals which may be received under various leases in connection with percentage
rents, common area charges, and real

                                       11
<PAGE>
       NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

        CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                  (UNAUDITED)

NOTE 10--RENTAL INCOME (CONTINUED)
estate taxes. Aggregate contingent rentals were approximately $686,000 and
$933,000, for the six months ended June 30, 2000 and the year ended
December 31, 1999, respectively.

    In August 1988, the Partnership entered into a land lease agreement with an
existing tenant of the Timpany Plaza Shopping Center in Gardner, Massachusetts.
The minimum annual rents are $110,000 per year for the first five years
increasing each subsequent five-year period, with the average being $137,500 per
year for the minimum 20-year term. Included in rents receivable at June 30, 2000
and December 31, 1999 is $168,750 and $175,000 respectively, representing the
deferred rental income from this lease. There are also contingent rents based
upon sales volume, common area maintenance, and other charges. This lease also
provides for six extension periods of five years each at increased rents. The
minimum rents pertaining to this agreement are reflected in the foregoing table.

    Concurrently, the Partnership entered into a joint venture with this same
tenant relating to the space formerly leased by the tenant. Under this
arrangement, the two parties have agreed to relet the space and divide the net
income or loss after paying to the Partnership an annual minimum rent of
$84,546. The Partnership's share of income for the six months ended June 30,
2000 and 1999 was $17,822 and $14,230, respectively.

    Rents receivable are net of allowances for doubtful accounts of $206,415 and
$149,386 at June 30, 2000 and December 31, 1999, respectively.

NOTE 11--FAIR VALUE OF FINANCIAL INSTRUMENTS

    The Partnership considers the fair value of its financial instruments to
approximate their carrying values because conditions pertaining to the historic
carrying values approximate those in the current market.

NOTE 12--CASH FLOW INFORMATION

    Cash paid for interest for the six months ended June 30, 2000 and 1999 was
approximately $3,100,000 and $2,300,000, respectively.

NOTE 13--TAXABLE INCOME AND TAX BASIS

    Taxable income reportable by the Partners is different than financial
statement income because of accelerated depreciation, different tax lives for
some properties, impairment losses, and the inclusion for tax purposes of
profits and losses realized on equity investments. Taxable income for 1999 was
approximately $415,000 greater than financial statement income.

    The sale of the Lewiston Mall Shopping Center in 2000 resulted in a
statement gain of approximately $550,000. This sale will result in a long term
capital loss for tax purposes of approximately $2,750,000 due to an impairment
loss of approximately $3,250,000 recorded in 1995.

NOTE 14--SUBSEQUENT EVENTS

    In July 2000, nine of the Partnerships' mortgages were refinanced and one
new mortgage was incurred on a previously debt free property. An additional two
mortgages are scheduled for refinancing at the end of August. The total of the
12 new mortgages is approximately $32,000,000; the repaid

                                       12
<PAGE>
       NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

        CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                  (UNAUDITED)

NOTE 14--SUBSEQUENT EVENTS (CONTINUED)
mortgages totaled approximately $24,000,000. The new 8.44% mortgages mature in
2010 and require interest only payments until maturity. The repaid mortgages had
interest rates ranging 8.25% to 9.25% and were to mature in 2005. As a result of
this new financing, the Partnership will record an extraordinary charge in the
third quarter of 2000 of approximately $1,500,000 representing prepayment
penalties of approximately $1,100,000 and the write off of deferred financing
costs of approximately $400,000. New deferred financing fees of approximately
$300,000 will be amortized over the 10 year maturities of the new mortgages
using the interest rate method.

    In July the Partnership declared a semi-annual distribution of $5.60 per
unit ($.56 per depositary receipt) payable on September 30, 2000 to holders of
record as of September 15, 2000.

                                       13
<PAGE>
                MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATION

RESULTS OF OPERATIONS

    New England Realty Associates Limited Partnership and its Subsidiary
Partnerships earned income from operations of $1,196,692 during the three months
ended June 30, 2000, compared to $775,688 for the three months ended June 30,
1999, an increase of $421,004. For the six months ended June 30, 2000, income
from operations was $2,087,443 compared to $1,290,539 for the same period in
1999, an increase of $796,904.

    The rental activity is summarized as follows:

<TABLE>
<CAPTION>
                                                              OCCUPANCY RATE
                                                            -------------------
                                                                AT JUNE 30,
                                                            -------------------
                                                              2000       1999
                                                            --------   --------
<S>                                                         <C>        <C>
Residential
  Units...................................................    2,099      1,652
  Vacancies...............................................       33         28
  Vacancy rate............................................      1.6%       1.7%

Commercial
  Total square feet.......................................  322,375    496,700
  Vacancy.................................................   56,000     70,000
  Vacancy rate............................................       17%        14%
</TABLE>

<TABLE>
<CAPTION>
                                                                RENTAL INCOME
                                                             -------------------
                                                              SIX MONTHS ENDED
                                                                  JUNE 30,
                                                             -------------------
                                                               2000       1999
                                                             --------   --------
                                                               (IN THOUSANDS)
<S>                                                          <C>        <C>
Total rents................................................  $12,838     $9,603
Residential percentage.....................................       83%        86%
Commercial percentage......................................       17%        14%
Contingent rentals.........................................  $   648     $  461
</TABLE>

    Rental income for the three months ended June 30, 2000 was $6,461,321
compared to $4,824,390 for the three months ended June 30, 1999, an increase of
$1,636,931(34%). Approximately $1,273,000 of this increase represents rental
income from properties acquired in 1999. Rental income for the six months ended
June 30, 2000 was $12,838,383 compared to $9,602,588 for the six months ended
June 30, 1999, an increase of $3,235,795 (34%). Approximately $2,533,000 of the
increase for the six months ended June 30, 2000 represents rental income from
properties acquired in 1999. More specifically, the Partnership acquired two
residential apartment complexes in December 1999, comprising a total of 448
units, and a 39,600 square foot commercial building in May 1999. The Partnership
also sold a 16 unit residential apartment complex and one condominium unit in
April 1999. The 17 units which were sold in 1999 were not significant to this
analysis. The Partnership sold the Lewiston Mall Shopping Center on June 28,
2000. Rental income at the existing commercial properties increased
approximately $176,000 due to improved occupancy at the Timpany Plaza Shopping
and 62 Boylston Street. Rental income at the existing residential properties
increased approximately $527,000 for the six months ended June 30, 2000, due to
increased rental rates.

    Expenses for the second quarter of 2000 were $5,332,520 compared to
$4,090,715 for the same period in 1999, an increase of $1,241,805 (30%). This
increase includes approximately $1,140,000 of expenses related to the properties
acquired in 1999. Other increases unrelated to the acquired

                                       14
<PAGE>
properties includes an increase in depreciation and amortization expense of
approximately $87,000 (10%) due to ongoing capital improvements to Partnership
properties; an increase in operating expenses of approximately $62,000(18%) due
to an increase in heating costs; and an increase in taxes and insurance of
approximately $57,000(12%) due to an increase in real estate taxes of $32,000
and the cost of insurance. The Partnership increased its coverage on properties,
added earthquake and flood insurance in 2000 and it received a rebate of $7,000
in workman's compensation insurance during the first six months of 1999. These
factors contributed to the increase in insurance expense in 2000. The
Partnership also experienced decreases in expenses unrelated to the acquired
properties. These decreases include approximately $38,000( 6%) in repairs and
maintenance expenses; and approximately $23,000(31%) in renting expenses due to
lower advertising costs and rental commissions.

    Expenses for the six months ended June 30, 2000 were $10,878,014 compared to
$8,384,096 for the six months ended June 30, 1999 an increase of
$2,493,918(30%). This increase includes approximately $2,327,000 which relates
to the three new properties acquired during 1999. Unrelated to the acquisitions
in 1999, depreciation and amortization expense increased approximately
$213,000(12%); taxes and insurance increased approximately $83,000(8%); and
operating expenses increased approximately $56,000(6%). Repairs and maintenance
and renting expenses decreased approximately $74,000(6%) and approximately
$41,000(32%), respectively. The reasons for these fluctuations are discussed in
the preceding paragraph.

    As a result of the changes discussed above, income from operations for the
three months ended June 30, 2000 was $1,196,692 compared to $775,688 for the
three months ended June 30, 1999, an increase of $421,004(54%). Income from
operations for the six months ended June 30, 2000 was $2,087,443 compared to
$1,290,539 for the six months ended June 30, 2000, an increase of $796,904(62%).

    Interest income was $32,097 for the three months ended June 30, 2000,
compared to $117,747 for the three months ended June 30, 1999, a decrease of
$85,650. Interest income was $72,171 for the six months ended June 30, 2000,
compared to $176,069 for the same period in 1999, a decrease of $103,898. This
decrease is due to a decrease in the average cash balance available for
investment in 2000 compared to 1999.

    The Partnership is a partner in a joint venture with a tenant at the Timpany
Plaza Shopping Center in Gardner, Massachusetts. Under the terms of the
agreement, the two parties have agreed to relet the space formerly leased by the
tenant, and divide the net income or loss after paying to the Partnership an
annual rent of approximately $84,000. The Partnership's investment in the
Timpany Plaza joint venture represents less than 1% of the Partnership's assets.
The Partnership's share of income in the joint venture at the Timpany Plaza
Shopping Center was $11,228 for the three months ended June 30, 2000 compared to
$9,299 for the same period in 1999, an increase of $1,929. For the six months
ended June 30, 2000, the Partnership's share of income from the joint venture
was $17,822 compared to $14,230 for the same period in 1999, an increase of
$3,592. These increases are due to rental rate increases in 2000.

    Included in other income for the three and six months ended June 30, 2000 is
a gain of $546,568 on the sale of the Lewiston Mall Shopping Center. Included in
other income for the three months and six months ended June 30, 1999 is a gain
of $676,124 from the sale of the Willard Street apartments and one condominium
and a loss on investments of approximately $250,000.

    As a result of the changes discussed above, net income for the three months
ended June 30, 2000 was $1,786,565 compared to $1,372,264 for the three months
ended June 30, 1999, an increase of $414,301. Net income for the six months
ended June 30, 2000 was $2,724,430 compared to $1,887,333 for the six months
ended June 30, 1999, an increase of $837,097.

                                       15
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES

    The Partnership's principal source of cash during 2000 was the collection of
rents, and the sale of a Partnership property. The majority of cash and cash
equivalents of $4,179,656 at June 30, 2000 and $1,244,438 at December 31, 1999
was held in an interest bearing account.

    The Partnership's short-term investments are approximately $22,000 at
June 30, 2000 and December 31, 1999, of which $7,000 was held in a Massachusetts
Municipal Bond Fund and $15,000 is invested in a U.S. Treasury Fund.

    On June 28, 2000, the Partnership sold the Lewiston Mall Shopping Center.
The property was sold for $5,100,000. The mortgage of approximately $2,900,000
was paid off and the net cash received by the Partnership after closing costs
and operating adjustments was approximately $2,043,000. Rental income from the
property was approximately $600,000 and $1,035,000 for the six months ended
June 30, 2000 and the year ended December 31, 1999, respectively. Income from
operations for the six months ended June 30, 2000 and year ended December 31,
1999 was approximately $130,000 and $125,000, respectively.

    On March 24, 1999, the Partnership refinanced the Westgate Apartments
located in Woburn, Massachusetts. The new loan is $12,000,000 with an interest
rate of 7.07%, and a term of 15 years, amortized over 25 years. The net cash of
approximately $5,000,000 from this refinancing was used for acquisitions as well
as the improvements of rental properties.

    On April 30, 1999, the Partnership sold the Willard Street Apartments
located in Quincy, Massachusetts. The sale price was $850,000. The buyer assumed
the first mortgage of approximately $285,000, and the Partnership took back a
mortgage of approximately $480,000 at a rate of 7.5%. The net cash received from
the sale of this property in April 1999 was approximately $85,000. The $480,000
mortgage was collected in full on January 14, 2000.

    On May 27, 1999, the Partnership purchased a 39,600 square foot commercial
property known as Staples Plaza, located in Framingham, Massachusetts. The
purchase price was $8,200,000. The Partnership assumed an 8% mortgage on the
property of approximately $5,200,000 which matures in 2016 and the balance of
approximately $3,000,000 was funded from the Partnership's cash reserves.

    On December 3, 1999, the Partnership acquired through a controlled
affiliate, a 180 unit residential complex located in Brockton, Massachusetts for
a purchase price of $8,900,000. This controlled affiliate assumed a 6.52%
mortgage with an outstanding balance of $5,207,172 which has a maturity date of
October 2008. The balance of the purchase price of $3,692,828 was paid from cash
reserves.

    On December 23, 1999, the Partnership acquired, through a controlled
affiliate, a 268-unit residential complex and a 6,075 square-foot commercial
building located in Brockton, Massachusetts for a purchase price of $14,500,000.
The purchase was funded by a $11,600,000 mortgage, a $750,000 loan from the
majority shareholder of the General Partner, and $2,150,000 paid from available
cash. The 7.84% mortgage matures in 2009 and is being amortized over 30 years.
The loan from the majority shareholder of the General Partnership was paid in
full on April 6, 2000.

    In July 2000, the Partnership refinanced nine properties and incurred a
mortgage on one previously debt free property. The Partnership plans to
refinance two additional properties in August 2000. The total of the new
mortgages is approximately $32,000,000, the mortgages repaid were approximately
$24,000,000. The proceeds of these refinancings is approximately $6,500,000 net
of related expenses. (See Note 14 to the financial statements)

    During the six months ended June 30, 2000, the Partnership and its
Subsidiary Partnerships completed certain improvements to their properties at a
total cost of approximately $600,000. The most significant improvements were
made at the following properties: approximately $123,000 at 62 Boylston

                                       16
<PAGE>
Street in Boston, Massachusetts; approximately $60,000 at 1131-1137 Commonwealth
Avenue in Boston, Massachusetts; and approximately $88,000 at Westgate
Apartments in Woburn, Massachusetts. Additional improvements of approximately
$36,000, and $59,000 were made at Redwood Hills and Hamilton Oaks, respectively.
These improvements were funded from the escrow accounts previously established,
as well as cash reserves.

    In addition to the improvements made to date in 2000, the Partnership and
its Subsidiary Partnerships plan to invest an additional $1,500,000 in capital
improvements during 2000 of which approximately $1,450,000 is designated for
residential properties of which approximately $1,000,000 will be done at 62
Boylston Street and approximately $50,000 for commercial properties. These
improvements will be funded from escrow accounts as well as from the
Partnership's cash reserves.

    The Partnership anticipates that cash from operations and interest-bearing
investments will be sufficient to fund its current operations and to finance
current improvements to its properties. The Partnership's net income and cash
flow may fluctuate dramatically from year to year as a result of the sale of
properties, unanticipated increases in expenses, or the loss of significant
tenants.

    Since the Partnership's long-term goals include the acquisition of
additional properties, a portion of the proceeds from the refinancing and sale
of properties is reserved for this purpose. The Partnership will consider
refinancing existing properties if insufficient funds exist from cash reserves
to repay existing mortgages or if funds for future acquisitions are not
available.

FACTORS THAT MAY AFFECT FUTURE RESULTS

    Certain information contained herein includes forward-looking statements,
the realization of which may be impacted by the factors discussed below. The
forward looking statements are made pursuant to the safe harbor provisions of
the Private Securities Liquidation Reform Act of 1995 (the "Act"). This document
contains forward looking statements that are subject to risks and uncertainties,
including, but not limited to, uncertainty as to future financial results;
fluctuations in the residential real estate market in the greater metropolitan
Boston, Massachusetts area and the commercial real estate rental market in New
England; heating and other utility costs, and other risks detailed from time to
time in the Partnership's filings with the Securities and Exchange Commission.
These risks could cause the Partnership's actual results for fiscal year 2000
and beyond to differ materially from those expressed in any forward looking
statements made by or on behalf of the Partnership. The foregoing list factors
and the two more specific factors identified below should not be construed as
exhaustive or as an admission regarding the adequacy or disclosures made by the
Partnership prior to the date hereof or the effectiveness of said Act.

    The Partnership has signed a purchase and sale agreement, subject to further
due diligence and inspection, for the sale of the Timpany Plaza Shopping Center.
The sale price is approximately $4,900,000, and the gain and net cash received
on the sale will be approximately $1,500,000. Rental income at Timpany Plaza was
approximately $381,000 for the six months ended June 30, 2000 and approximately
$640,000 for the year ended December 31, 1999. The loss from operations was
approximately $100,000 and $334,000 for the six months ended June 30, 2000 and
year ended December 31, 1999, respectively.

    In connection with the refinancings which took place subsequent to
June 30,2000, the Partnership is considering to use the proceeds of the
refinancing, as well as the Partnership's cash reserves to payoff the mortgage
of approximately $7,400,000 on 62 Boylston Street, Boston, Massachusetts.

                                       17
<PAGE>
               NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP
                           PART II. OTHER INFORMATION

ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K.

    (a) Exhibits

        Copies of the following Exhibits are furnished with this report.

<TABLE>
<CAPTION>
        NO.                                             DESCRIPTION
        ---                                             -----------
        <C>                     <S>
                27                                Financial Data Schedule.
</TABLE>

    (b) Reports on Form 8-K

        None.

                                   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.

Date: August 11, 2000

<TABLE>
<S>                                                    <C>  <C>
                                                       NEW ENGLAND REALTY ASSOCIATES LIMITED
                                                       PARTNERSHIP

                                                       By: NEWREAL, INC.
                                                          its General Partner

                                                       By:  /s/ RONALD BROWN
                                                            -----------------------------------------
                                                            Ronald Brown
                                                            President
</TABLE>

                                       18