UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM
10-K

[x]
Annual Report Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934

For
the fiscal year ended December 31, 2014

[ ]
Transition report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934

For
the transition period from ________________ to _______________

Commission
File No. 2-83291.

DSI
REALTY INCOME FUND VII

a
California Limited Partnership

|California                                                     |  | 95-3871044                          
|-------------------------------------------------------------- |  | ------------------------------------
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)

6700
E. Pacific Coast Hwy., Long Beach, California 90803

(Address
of principal executive offices)

Registrant’s
telephone number, including area code (562) 493-8881

Securities
registered pursuant to Section 12(b) of the Act:

NONE

Securities
registered pursuant to Section 12(g) of the Act:

Units
of Limited Partnership Interests

Indicate by check mark if registrant is a well-known seasoned issuer, as defined in Rule 405 of the
Securities Act. Yes [ ] No [X]

Indicate
by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes
[ ] No [X]

Indicate
by check mark whether the registrant (l) 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 [ ]

Indicate
by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding
12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X] No [ ]

Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (229.405 of this chapter) is not contained
herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated
by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a
smaller reporting company.

Large accelerated filer [ ] Accelerated
filer [ ]  Non-accelerated filer [ ] Smaller reporting company [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]




Certain
statements contained in this discussion or elsewhere in this report may be deemed “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of 1995 and Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934. Words and phrases such as “expects”, “anticipates”, “intends”,
“plans”, “believes”, “seeks”, “estimates”, “designed to achieve”, variations
of such words and similar expressions are intended to identify such forward-looking statements, which generally are not historical
in nature. All statements that address operating performance, events or developments that we expect or anticipate will occur in
the future – including statements relating to rent and occupancy growth, general conditions in the geographic areas
where we operate – are forward-looking statements. These statements are not guarantees of future performance and involve
certain risks, uncertainties and assumptions that are difficult to predict.

Although
we believe the expectations reflected in any forward-looking statements are based on reasonable assumptions, we can give no assurance
that our expectations will be attained and therefore, actual outcomes and results may differ materially from what is expressed
or forecasted in such forward-looking statements. Many of the factors that may affect outcomes and results are beyond our ability
to control.

PART I

ITEM 1. BUSINESS

DSI Realty Income Fund VII
(the "Partnership") is a publicly-held limited partnership organized under the California Uniform Limited Partnership
Act pursuant to a Certificate and Agreement of Limited Partnership (hereinafter referred to as "Agreement") dated August
1, 1983. The General Partners are DSI Properties, Inc., a California corporation, and RJC Capital Management, LLC and JWC Capital
Management, LLC.

DSI Properties, Inc. is
an affiliate of Diversified Securities, Inc., a wholly-owned subsidiary of DSI Financial, Inc. The General Partners provide similar
services to other partnerships. Through its public offering of Limited Partnership Units, Registrant sold twenty-four thousand
(24,000) units of limited partnership interests aggregating Twelve Million Dollars ($12,000,000). The General Partners have retained
a one percent (1%) interest in all profits, losses and distributions (subject to certain conditions) without making any capital
contribution to the Partnership. The General Partners are not required to make any capital contributions to the Partnership in
the future.

The Partnership is engaged
in the business of investing in and operating mini-storage facilities with the primary objectives of generating, for its partners,
cash flow, capital appreciation of its properties, and obtaining federal income tax deductions so that during the early years of
operations, all or a portion of such distributable cash may not represent taxable income to its partners. Funds obtained by Registrant
during the public offering period of its units were used to acquire mini-storage facilities. Registrant does not intend to sell
additional limited partnership units. The term of the Partnership is fifty years, The term of the Partnership is fifty years, but
as of February 23, 2015 it has been confirmed by Goodrich, Baron & Goodyear LLP that a majority of Limited Partners have elected
to liquidate and sell the assets and dissolve the Fund. (See Notes to Financial Statement: Item 8, Subsequent Events)

The Partnership is intended
to be self-liquidating and it is not intended that proceeds from the sale or refinancing of its operating properties will be reinvested.
Registrant has no full time employees but shares one or more employees with other limited partnerships sponsored by the General
Partners.

The General Partners are
vested with authority as to the general management and supervision of the business and affairs of the Partnership. Limited Partners
have no right to participate in the management or conduct of such business and affairs. An independent management company has been
retained to provide day-to-day management services with respect to all of the Partnership's investment properties.

Please refer to the discussion
appearing elsewhere herein under the caption Management's Discussion and Analysis of Financial Condition and Results of Operations
for a detailed analysis of the results of operations of the Partnership's properties.

The business in which the
Partnership is engaged is highly competitive. Each of its mini-storage facilities is located in or near a major urban area, and
accordingly, competes with a significant number of individuals and organizations with respect to both the purchase and sale of
its properties and for rentals. Generally, the Partnership's business is not affected by the change in seasons.

ITEM 1A. RISK FACTORS

Not required.

ITEM 1B. UNRESOLVED STAFF
COMMENTS

None.

ITEM 2. PROPERTIES

The Partnership owns a fee
interest in the following mini-storage facilities, none of which are subject to long-term indebtedness. The following table sets
forth information regarding properties owned by the Partnership and their respective occupancies and revenue per square foot:

|              |         |        | 2014      | 2013     
|------------- | ------- | ------ | --------- | ---------
|              | Parcel  |        | (Average) | (Average)
|              | Size    | Date   | Rentable  | Revenue  
|Location      | (Acres) | Opened | Sq. Ft.   | Sq. Ft.  
|Chico, CA     | 1.97    | Jul-84 | 39,343    | 7.87     
|La Verne, CA  | 2.78    | Apr-85 | 52,410    | 10.20    
|Littleton, CO | 3.07    | Oct-85 | 45,788    | 11.48    
|Riverside, CA | 2.92    | Jan-85 | 61,027    | 7.13     
|Fairfield, CA | 2.29    | Aug-84 | 41,010    | 12.04    

On January 29, 2015, all
of the properties and assets of DSI Realty Income Fund VII (the “Fund”) were sold.



ITEM 3. LEGAL PROCEEDINGS

The Partnership is not a
party to any material pending legal proceedings.

ITEM 4. MINE SAFETY DISCLOSURES

None.







PART
II

ITEM 5. MARKET FOR REGISTRANT’S
COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information
The Partnership is a limited partnership and thus has no common stock. There is no established trading market for limited partnership
interests in the Partnership and it is not anticipated that any such public market will develop. The Limited Partnership Agreement
effectively prevents the transfer of Limited Partnership Interests except under very limited circumstances.  In order to transfer
a Limited Partnership Interest, a Limited Partner must obtain the consent of the General Partners of the Partnership, which have
the absolute right to refuse any request for a transfer. In addition, the proposed transferee must meet all applicable suitability
standards and agree to be bound by the Limited Partnership Agreement.

Approximate Number of
Security Holders

As of December 31, 2014,
there were approximately 849 holders of Limited Partnership Interests.

Distributions

Average cash distributions
of $6.31 per Limited Partnership Unit were declared and paid each quarter for the year ended December 31, 2014 and $6.31 per Limited
Partnership Unit were declared and paid each quarter for the year ended December 31, 2014.

ITEM 6. SELECTED FINANCIAL
DATA

Not Required.

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

Overview

The Partnership is engaged
in the business of investing in and operating mini-storage facilities with the primary objectives of generating, for its partners,
cash flow, capital appreciation of its properties, and obtaining federal income tax deductions so that during the early years of
operations, all or a portion of such distributable cash may not represent taxable income to its partners.

Critical Accounting Policies

Revenue
recognition - Rental income, which is generally earned pursuant to month-to-month leases for storage space, as well as late charges
and administrative fees, are recognized as earned. Promotional discounts reduce rental income over the promotional period. Ancillary
revenues and interest and other income are recognized when earned.

Discontinued
operations and held for sale - A discontinued operationis
a component (or group of components) of the entity, the disposal of which would represent a strategic shift that has (or will have)
a major effect on the entity’s operations and financial results, when such component (or group of components) have been disposed
of or classified as held for sale. The results of operations of properties that have been classified as discontinued operations
are reported as discontinued operations for all periods presented. We classify real property as held for sale when our management
commits to a plan to sell the property, the plan has appropriate approvals, the sale of the property is probable, and certain other
criteria are met. At such time, the respective assets and liabilities are presented separately on our balance sheets and depreciation
is no longer recognized. Assets held for sale are reported at the lower of their carrying amount or their estimated fair value
less the costs to sell the assets.

RESULTS OF OPERATIONS

2014 COMPARED TO 2013

Total revenues from discontinued
operation increased from $1,989,721 in 2013 to $2,294,651 in 2014, while total expenses from discontinued operation increased from
$1,250,727 to $1,223,691. As a result, net income from discontinuing operations decreased from $738,994 to $1,070,960. Rental revenues
from discontinued operation increased primarily as a result of increased rental rates. Occupancy levels for the Partnership’s
mini-storage facilitiesaveraged 87.1% for the year 2014 as compared to 74.8% for 2013. Operating expenses from discontinued
operation decreased $52,971 (6%) primarily due to decreases inadvertising and repair and maintenance
and ground maintenance expenses; partially offset by an increase in real estate taxes and salary and wages expenses. General and
administrative expenses from discontinued operation decreased $4,878 (4%) primarily as a result of increases in legal and professional
expenses. The General Partners’ incentive management fee decreased, which is based on cash available for distribution.

Discontinued operating expenses consist mainly of expenses such
as promotional advertising, yellow pages and other forms of advertising, fire and liability insurance, workers compensation insurance,
repairs and maintenance, real estate taxes, salaries and wages and their related expenses. General and administrative expenses
consist mainly of expenses such as legal and professional, office supplies, accounting services and computer expenses.

LIQUIDITY AND CAPITAL RESOURCES

Net cash provided by operating activitiesincreased $102,687 (15.31%)to $773,383 in 2014 compared to $670,696 in 2013primarily
due to an increase in customer deposits and other revenues from prior year.

Cash used in investing activities, consists of acquisition of property
or capital improvements to the Partnership's mini storage facilities. There were no significant investing activities in 2014 and
2013. The Partnership currently has no material commitments for capital expenditures.

Cash used in financing activities, as set forth in the statements
of cash flows, has consisted solely of cash distributions to partners in 2014 and 2013.

The General Partners are not aware of any environmental problems which could have a material adverse effect upon the financial
position of the Partnership.



On January 23, all of the properties and assets of DSI Realty Income
Fund VII (the “Fund”) were sold to affiliates of Smart Stop Self Storage for an aggregate gross sale price of $16,840,000(the
“Sale”). The Sale was approved by the affirmative vote of the holders of approximately 55.6% of the outstanding units
of limited partnership interests in the Fund (the “Units”) in accordance with the proxy statement of the Fund dated
November 21, 2014 (the “Proxy Statement”).



LONG-TERM LIABILITIES
AND CONTRACTUAL OBLIGATIONS

None.

OFF-BALANCE
SHEET ARRANGEMENTSNone.QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

Summarized quarterly financial
data for the year ended December 31, 2014 was as follows:





|                                                               | 2014 Quarter Ended:
|-------------------------------------------------------------- | -------------------
|                                                               | March 31           
|Total revenues from discontinued operation                     | 532,122            
|Net income                                                     | 154,239            
|Net income per limited partnership unit                        |                    
|$ 6.36                                                         | $ 10.02            
|Weighted average numberof limited partnershipunits outstanding |                    
|                                                               |                    
|24,000                                                         | 24,000             

ITEM 7A. QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not Required.



































ITEM 8. FINANCIAL STATEMENTS
AND SUPPLEMENTARY DATA

DSI
REALTY INCOME FUND VII(A California Real Estate Limited Partnership)

INDEX TO FINANCIAL STATEMENTS
AND SUPPLEMENTAL SCHEDULE

FINANCIAL STATEMENTS:

Report
of Independent Registered Public Accounting Firm	F-1

Balance
Sheets as of December 31, 2014 and 2013	F-2

Statements
of Income for the Years Ended December 31, 2014 and 2013	F-3

Statements
of Changes in Partners' Equity (Deficit) for the Years Ended December 31, 2014 and 2013	F-4

Statements
of Cash Flows for the Years Ended December 31, 2014 and 2013	F-5

Notes
to Financial Statements	F-6

SUPPLEMENTAL
SCHEDULE:

Schedule
III - Real Estate and Accumulated Depreciation as of December 31, 2014	 F-10







































2014 ANNUAL REPORT TO
LIMITED PARTNERS OF

DSI REALTY INCOME FUND
VII

Financial Statements for
its fiscal year ended December 31, 2014



REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM

To the Partners of DSI Realty
Income Fund VII:

We
have audited the accompanying balance sheets of DSI Realty Income Fund VII, a California Limited Partnership (the "Partnership")
as of December 31, 2014 and 2013 and the related statements of income, changes in partners' equity (deficit), and cash flows for
each of the years in the two year period ended December 31, 2014. Our audits also included the supplemental schedule listed in
the Index at Item 15(2). These financial statements and the supplemental schedule are the responsibility of the Partnership's management.
Our responsibility is to express an opinion on these financial statements and supplemental schedule based on our audits.

We
conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material
misstatement. The Partnership is not required to have, nor were we engaged to perform, an audit of its internal control over financial
reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Partnership's
internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

In
our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of DSI
Realty Income Fund VII at December 31, 2014 and 2013, and the results of its operations and its cash flows for each of the years
in the two year period ended December 31, 2014, in conformity with accounting principles generally accepted in the United States
of America. Also, in our opinion, the supplemental schedule referred to above, when considered in relation to the basic financial
statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

/s/ Anton & Chia, LLP

Newport Beach, CaliforniaMarch 31, 2015

Page
F-1







DSI REALTY INCOME FUND
VII(A California Real Estate Limited Partnership)

|BALANCE SHEETS                         |             |            
|-------------------------------------- | ----------- | -----------
|AS OF DECEMBER 31,                     | 2014        | 2013       
|ASSETS                                 |             |            
|Cash                                   | $ 416,403   | $ 254,681  
|Discontinued operating assets          | 1,946,605   | 1,906,050  
|TOTAL ASSETS                           | $ 2,363,008 | $ 2,160,731
|LIABILITIES AND PARTNERS' EQUITY       |             |            
|LIABILITIES                            |             |            
|Distribution due to partners (Note 4)  | $ 151,515   | $ 151,515  
|Accrued expenses                       | 27,550      | 27,550     
|Discontinued operating liabilities     | 115,310     | 138,200    
|Total liabilities                      | 294,375     | 317,265    
|PARTNERS' EQUITY (DEFICIT) (Note 4)    |             |            
|General partners                       | (87,085)    | (89,337)   
|Limited partners                       | 2,155,718   | 1,932,803  
|Total partners' equity                 | 2,068,633   | 1,843,466  
|TOTAL LIABILITIES AND PARTNERS’ EQUITY | $ 2,363,008 | $ 2,160,731

The accompanying notes are
an integral part of these Financial Statements.

Page
F-2







DSI REALTY INCOME FUND
VII(A California Real Estate Limited Partnership)

|STATEMENTS OF INCOME                                    |           |          
|------------------------------------------------------- | --------- | ---------
|FOR THE YEARS ENDED DECEMBER 31,                        | 2014      | 2013     
|REVENUES                                                |           |          
|Self-storage rental income                              | $ -       | $ -      
|Total Revenues                                          | $ -       | $ -      
|                                                        |           |          
|EXPENSES                                                |           |          
|General and administrative                              | 234,133   | 192,635  
|Total Expenses                                          | 234,133   | 192,635  
|LOSS FROM CONTINUING OPERATIONS                         | (234,133) | (192,635)
|                                                        |           |          
|INCOME FROM DISCONTINUED OPERATIONS                     | 1,070,960 | 738,995  
|NET INCOME                                              | $ 836,827 | $ 546,360
|                                                        |          
|AGGREGATE NET INCOME ALLOCATED TO (Note 4)              |          
|General partners                                        | $ 8,368   | $ 5,464  
|Limited partners                                        | 828,459   | 540,896  
|TOTAL                                                   | $ 836,827 | $ 546,360
|                                                        |           |          
|Number of limited partnership units outstanding         | 24,000    | 24,000   
|NET INCOME PER LIMITED PARTNERSHIP UNIT (Notes 2 and 4) | $ 34.52   | $ 22.54  

The accompanying notes are
an integral part of these Financial Statements.

Page F-3







DSI REALTY INCOME FUND
VII(A California Real Estate Limited Partnership)

|STATEMENTS OF CHANGES IN PARTNERS' EQUITY (DEFICIT)
|---------------------------------------------------
|                                                   
|BALANCE DECEMBER 31, 2012                          
|Net income allocation                              
|Distributions                                      
|BALANCE DECEMBER 31, 2013                          
|Net income allocation                              
|Distributions                                      
|BALANCE DECEMBER 31, 2014                          

The accompanying notes are
an integral part of these Financial Statements.

Page
F-4







DSI REALTY INCOME FUND
VII(A California Real Estate Limited Partnership)

|STATEMENTS OF CASH FLOWS                                               |           |          
|---------------------------------------------------------------------- | --------- | ---------
|FOR THE YEARS ENDED DECEMBER 31,                                       | 2014      | 2013     
|OPERATING ACTIVITIES                                                   |           |          
|Net income                                                             | $ 836,827 | $ 546,360
|Less: Net income from discontinued operations                          | 1,070,960 | 738,994  
|Net loss from continuing operating activities:                         | (234,133) | (192,634)
|Net cash provided by operating activities from continuing operations   | (234,133) | (192,634)
|Net cash provided by operating activities from discontinued operations | 1,007,516 | 863,330  
|NET CASH PROVIDE BY OPERATING ACTIVITIES                               | 773,383   | 670,696  
|                                                                       |           |          
|FINANCING ACTIVITIES                                                   |           |          
|Distributions to partners                                              | (611,661) | (611,660)
|Net cash used in financing activities                                  | (611,661) | (611,660)
|NET DECREASE IN CASH AND CASH EQUIVALENTS                              | 161,722   | 59,036   
|CASH AND CASH EQUIVALENTS, AT BEGINNING OF YEAR                        | 348,465   | 412,303  
|Cash from continuing components                                        | 254,681   | 195,645  
|Cash from discontinued components                                      | 93,784    | 216,658  
|                                                                       |           |          
|CASH AND CASH EQUIVALENTS, AT END OF YEAR                              | $ 525,181 | $ 348,465
|Cash from continuing components                                        | 416,403   | 254,681  
|Cash from discontinued components                                      | 108,778   | 93,784   
|                                                                       |           |          
|SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION                       |           |          
|Cash paid for interest                                                 | $ -       | $ -      
|                                                                       |           |          
|NON CASH INVESTING AND FINANCING ACTIVITIES                            |           |          
|Distribution due to partners included in partners' equity              | $ 151,515 | $ 151,515

The
accompanying notes are an integral part of these Financial Statements.

Page
F-5







DSI REALTY INCOME FUND
VII(A California Real Estate Limited Partnership)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2014

1. GENERAL

DSI Realty Income Fund VII,
a California Limited Partnership (the "Partnership"), has three general partners (DSI Properties, Inc., RJC Capital Management,
LLC and JWC Capital Management, LLC and limited partners owning 24,000 limited partnership units,
which were purchased for $500 per unit. The general partners have made no capital contributions to the Partnership and are not
required to make any capital contributions in the future. The Partnership has a maximum life of 50 years and was formed
on August 1, 1983, under the California Uniform Limited Partnership Act for the primary purpose of acquiring and operating real
estate.

DSI Properties, Inc. is
an affiliate of Diversified Securities, Inc., a wholly-owned subsidiary of DSI Financial, Inc. The General Partners provide similar
services to other partnerships. Through its public offering of Limited Partnership Units, Registrant sold twenty-four thousand
(24,000) units of limited partnership interests aggregating Twelve Million Dollars ($12,000,000). The General Partners have retained
a one percent (1%) interest in all profits, losses and distributions (subject to certain conditions) without making any capital
contribution to the Partnership. The General Partners are not required to make any capital contributions to the Partnership in
the future.

The Partnership owns mini-storage
facilities located in Chico, Fairfield, La Verne and Riverside, California; and Littleton, Colorado. All facilities were purchased
from Dahn Corporation ("Dahn"). Dahn is not affiliated with the Partnership. Dahn is affiliated with other partnerships
in which DSI Properties, Inc. is a general partner (see Note 6).

2. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES

Cash - The Partnership classifies
its short-term investments purchased with an original maturity of three months or less as cash equivalents. As of December 31,
2014 the Partnership had no cash equivalents.



Uncollected Rental Revenue - The
Partnership estimates the collectability of uncollected rental revenue on an ongoing basis by reviewing past-due monthly rents
and assessing the current creditworthiness of each tenant.  Allowances are provided based on historical write-offs. Allowances
on uncollected rental revenue as of December 31, 2014 and 2013 were $17,755 and$13,954,
respectively.

Property and Depreciation
- Property is recorded at cost and is composed primarily of mini-storage facilities. Depreciation is provided using the straight-line
method over an estimated useful life of 20 years for the facilities. Building improvements are depreciated over a five year period.
Property under capital leases is amortized over the lesser of the lives of the respective leases or the estimated useful lives
of the assets.



Page
F-6







Income Taxes - No provision
has been made for income taxes in the accompanying financial statements. The taxable income or loss of the Partnership is allocated
to each partner in accordance with the terms of the Agreement of Limited Partnership. Each partner's tax status, in turn, determines
the appropriate income tax for its allocated share of the Partnership's taxable income or loss. For the year ended December 31,
2011 the Partnership changed the accounting method for federal income tax purposes from cash to accrual basis thereby eliminating
the difference in the basis of the Partnership’s assets and liabilities between tax and the GAAP basis financial statements.
The change in tax accounting method resulted in an adjustment to the limited partners’ capital account for tax purposes for
the year ended December 31, 2011 only in order to coincide with the accounting method used to prepare the Partnership’s GAAP
basis financial statements. Accordingly there were no differences for the year ended December 31, 2014.



Revenues - Rental income, which is generally earned pursuant to
month-to-month leases for storage space, as well as late charges and administrative fees, are recognized as earned. Promotional
discounts reduce rental income over the promotional period. Ancillary revenues and interest and other income are recognized when
earned.

Advertising Expense - Costs
related to advertising in Yellow Pages are capitalized and amortized over 12 months. All other advertising costs are expensed as
incurred. Advertising expense for the years ended December 31, 2014 and 2013 were $118,246
and $150,880 respectively.

Net
Income per Limited Partnership Unit - Net income per limited partnership unit is computed by dividing net income allocated to the
limited partners by the weighted average number of limited partnership units outstanding during each year.

Reclassifications
- Certain amounts included in the accompanying financial statements for 2014 and 2013 have been reclassified to conform to the
2014 financial statement presentation. Balance sheet amounts for properties classified as held for sale have been reclassified
as of December 31, 2014 and 2013. Statement of operations amounts for properties classified as discontinued operations have
been reclassified for all periods presented. Discontinued operation is
a component (or group of components) of the entity, the disposal of which would represent a strategic shift that has (or will have)
a major effect on the entity’s operations and financial results, when such component (or group of components) have been disposed
of or classified as held for sale. Through December 31, 2014, discontinued operations represent properties that we have either
disposed of or have classified as held for sale if both the operations and cash flows of the property have been or will be eliminated
from our ongoing operations as a result of the disposal transaction and if we will not have any significant continuing involvement
in the operations of the property after the disposal transaction

Estimates - The preparation
of financial statements in conformity with accounting principles generally accepted in the United States of America requires the
Partnership to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent
assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.

Impairment of Long-Lived
Assets - The Partnership regularly reviews long-lived assets for impairment whenever events or changes in circumstances indicate
that the carrying amount of the asset may not be recoverable. If the sum of the expected undiscounted future cash flow is less
than the carrying amount of the asset, the Partnership would recognize an impairment loss to the extent the carrying value exceeded
the fair value of the property. No impairment losses were required in 2014 or 2013.

Fair Value of Financial
Instruments - ASC 825-10 (formerly SFAS 107, “Disclosures about Fair Value of Financial Instruments”) defines financial
instruments and requires disclosure of the fair value of financial instruments held by the Partnership. For all financial instruments,
including cash and cash equivalents, other assets, distributions due to partners, incentive management fee payable to general partners,
property management fee payable, and customer deposits and other liabilities, carrying values approximate fair values because of
the short maturity of those instruments.

Concentrations of Credit
Risk - Financial instruments that potentially subject the Partnership to concentrations of credit risk consist primarily of cash
and cash equivalents and uncollected rent revenue. The Partnership places its cash and cash equivalents with high credit quality
institutions. Accounts at banks are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. At
December 31, 2014, the Partnership had $166,403 in excess of insured limits. The Partnership performs ongoing evaluations
of these institutions to limit its concentration of risk exposure. Management believes this risk is not significant due to the
financial strength of the financial institutions utilized by the Partnership.

Comprehensive Income - The
Partnership has adopted Accounting Standards Update 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive
Income. For the year ended December 31, 2013 and 2011 comprehensive income equaled net income, as the Partnership had no other
comprehensive income. As of December 31, 2014 and 2013, accumulated other comprehensive income was $0.

Page
F-7



Recent Accounting Pronouncements

The Partnership has reviewed all the
recent accounting pronouncements issued to date of the issuance of these financial statements, and does not believe any of these
pronouncements will have a material impact on the Partnership’s financial statements.



In April 2014, the FASB issued Accounting Standards
Update 2014-08 (“ASU 2014-08”), which provides a revised definition of a discontinued operation. ASU
2014-08 requires additional disclosures for a discontinued operation and the disposal of an asset and component
of the entity that is not a discontinued operation. Under ASU 2014-08, a discontinued operation is
a component (or group of components) of the entity, the disposal of which would represent a strategic shift that has (or will have)
a major effect on the entity’s operations and financial results, when such component (or group of components) have been disposed
of or classified as held for sale. The amendments in the ASU should be applied prospectively and are effective for us beginning
January 1, 2015, with early adoption permitted. We adopted this standard effective December 31, 2014.



3. PROPERTY

The total cost of property
and accumulated depreciation from discontinued operations is as follows as of December 31:

|                              | 2014        | 2013       
|----------------------------- | ----------- | -----------
|Land                          | $ 1,714,700 | $ 1,714,700
|Buildings and improvements    | 6,476,310   | 6,456,123  
|Rental trucks                 | 140,093     | 140,093    
|Total                         | 8,331,103   | 8,310,916  
|                              |             |            
|Less accumulated depreciation | (6,584,993) | (6,575,864)
|                              |             |            
|Property - net                | $ 1,746,110 | $ 1,735,052



Asof January 29, 2015, the sale of all the properties was approved by the affirmative vote
of the holders of approximately 53.9% of the outstanding units of limited partnership interests in the Fund. As of December 31
2014 and 2013, all the properties have been classified as discontinued operation.

4. ALLOCATION OF PROFITS
AND LOSSES AND GENERAL PARTNERS' INCENTIVE MANAGEMENT FEE

Under the Agreement of Limited
Partnership, the general partners are to be allocated 1% of the net profits or losses from operations, and the limited partners
are to be allocated the balance of the net profits or losses from operations in proportion to their limited partnership interests.
The general partners are also entitled to receive a percentage, based on a predetermined formula, of any cash distribution from
the sale, other disposition, or refinancing of the project.

In addition, the general
partners are entitled to receive an incentive management fee for supervising the operations of the Partnership. The fee is to be
paid in an amount equal to 9% per annum of the cash available for distribution on a cumulative basis, calculated as cash generated
from operations less capital expenditures.

5. BUSINESS SEGMENT INFORMATION

The following disclosure
about segment reporting of the Partnership is made in accordance with the requirements of ASC 280-10 (formerly SFAS No. 131, "Disclosures
About Segments of an Enterprise and Related Information") The Partnership operates in a single segment; storage facility operations,
under which the Partnership rents its storage facilities to its customers on a need basis and charges rent on a predetermined rate.

6. RELATED-PARTY TRANSACTIONS

The Partnership has entered into management agreements
with Dahn to operate its mini-storage facilities. Each agreement provides for a management fee equal to 5% of gross revenue from
operations, defined as the entire amount of all receipts from the renting or leasing of storage compartments and sale of locks.
The management agreements are renewable annually. During 2014 and 2013 the Partnership paid Dahn management fees of $114,261 and
$100,614, respectively. Amounts payable to Dahn at December 31, 2014 and 2013, were $10,031 and $7,739, respectively.

Beginning in July 2011, the General Partner, DSI Properties,
Inc. performs all tax related work with respect to the Partnership. These services are paid monthly in the amount of $3,826. Tax
fees paid to DSI Properties, Inc. for the year ended December 31, 2014 were $45,912.

7. DISCONTINUED OPERATIONS

On January 29, 2015, the
Partnership mini-storage facilities located in Chico, Fairfield, La Verne and Riverside, California; and Littleton, Colorado were
sold.

The
following table summarizes the balance sheets components that comprise discontinued operations:

|                                             |             |            
|-------------------------------------------- | ----------- | -----------
|BALANCE SHEETS                               | 2014        | 2013       
|ASSETS                                       |             |            
|Cash                                         | $ 108,778   | $ 93,784   
|Property, net                                | 1,746,110   | 1,735,052  
|Uncollected rental revenue                   | 71,018      | 55,818     
|Prepaid advertising                          | 698         | 1,396      
|Other assets                                 | 20,000      | 20,000     
|TOTAL ASSETS OF DISCONTINUED OPERATIONS      | $ 1,946,604 | $ 1,906,050
|                                             |             |            
|LIABILITIES                                  |             |            
|Incentive management fee liability           | 22,708      | 32,955     
|Property management fee liability            | 10,031      | 7,739      
|Deferred income                              | 51,199      | 55,277     
|Accrued expenses                             | 17,537      | 30,537     
|Other liabilities                            | 13,834      | 11,692     
|TOTAL LIABILITIES OF DISCONTINUED OPERATIONS | 115,309     | 138,200    
|NET ASSETS OF DISCONTINUED OPERATIONS        | $ 1,831,295 | $ 1,767,850



The following table summarizes
the revenue and expense components that comprise discontinued operations:

|                                                  | For the year ended December 31,
|------------------------------------------------- | -------------------------------
|                                                  | 2014                           
|                                                  |                                
|REVENUE                                           | $2,294,651                     
|DEPRECIATION                                      | 9,129                          
|OPERATING EXPENSES                                | 908,097                        
|GP’S INCENTIVE FEES                               | 79,239                         
|PROPERTY MANAGEMENT FEE                           | 114,261                        
|G&A EXPENSES                                      | 112,965                        
|NET OPERATING INCOME FROM DISCONTINUED OPERATIONS | 1,070,960                      
|NET GAIN ON SALE OF DISCONTINUED OPERATIONS       | -                              
|TOTAL INCOME FROM DISCONTINUED OPERATIONS         | $1,070,960                     
|                                                  |                                



As
of January 23, 2015, the sale of all the properties was approved by the affirmative vote of the holders of approximately 53.9%
of the outstanding units of limited partnership interests in the Fund. As of December 31 2014 and 2013, all the properties have
been classified as discontinued operation.

8. SUBSEQUENT EVENTS



On January 23, 2015, all of the properties and assets of DSI Realty
Income Fund VII (the “Fund”) were sold to affiliates of Smart Stop Self Storage for an aggregate gross sale price of
$16,840,000(the “Sale”). The Sale
was approved by the affirmative vote of the holders of approximately 55.6% of the outstanding units of limited partnership interests
in the Fund (the “Units”) in accordance with the proxy statement of the Fund dated November 21, 2014 (the “Proxy
Statement”).



Page
F-9









ITEM 8.

DSI REALTY INCOME FUND VII(A California Real Estate Limited Partnership)

SCHEDULE III

REAL ESTATE AND ACCUMULATED DEPRECIATIONAs of December 31, 2014

|Initial Cost  | Gross Carrying Amount at December 31, 2014
|------------- | ------------------------------------------
|Description   | Acquisition Date                          
|Chico, CA     | 12/83                                     
|Fairfield, CA | 01/84                                     
|La Verne, CA  | 08/84                                     
|Littleton, CO | 05/85                                     
|Riverside, CA | 06/84                                     
|              |                                           

Notes:

| | 1. | Depreciation expense is computed using the straight-line method over an estimated useful life
of 20 years for the buildings.
| | -- | ----------------------------------------------------------------------------------------------------------------------------

| | 2. | There are no encumbrances.
| | -- | --------------------------

3.As of January 23, 2015, the sale of all the properties was approved by the affirmative vote of the holders of approximately 53.9%
of the outstanding units of limited partnership interests in the Fund. As of December 31 2014 and 2013, all the properties have
been classified as discontinued operation.



Page
F-10







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

None.

ITEM 9A. CONTROLS AND
PROCEDURES

Disclosure Controls and Procedures



The Partnership’s management, with the participation of the
principal executive officer and principal financial officer of DSI Properties, Inc., its General Partner, who are the equivalent
of the Partnership’s principal executive officer and principal financial officer, respectively, has evaluated the effectiveness
of the Partnership’s disclosure controls and procedures (as defined in Rules 13a-15(e) under the Securities Exchange Act
of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on such
evaluation, the principal executive officer and principal financial officer of the General Partner, who are the equivalent of the
Partnership’s principal executive officer and principal financial officer, respectively, have concluded that, as of the end
of such period, the Partnership’s disclosure controls and procedures are effective.

Management’s Annual
Report on Internal Control Over Financial Reporting

The Partnership’s
management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control
over financial reporting is defined in Rule 13a-15(f) under the Exchange Act as a process designed by, or under the supervision
of, the principal executive and principal financial officers of the General Partner, who are the equivalent of the Partnership’s
principal executive officer and principal financial officer, respectively, and effected by the Partnership’s management and
other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures
that:

| | · | pertain to the maintenance of records that in reasonable detail accurately and fairly reflect
the transactions and dispositions of assets;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------

| | · | provide reasonable assurance that transactions are recorded as necessary to permit preparation
of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures are being
made only in accordance with authorizations of the Partnership’s management; and
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition,
use or disposition of assets that could have a material effect on the financial statements.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Because of its inherent
limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of
effectiveness to future periods are subject to the risks that controls may become inadequate because of changes in conditions,
or that the degree of compliance with the policies or procedures may deteriorate.

Internal Controls Over Financial
Reporting

The Partnership's management
assessed the effectiveness of the Partnership's internal control over financial reporting as of December 31, 2014. In making
this assessment, the Partnership's management used the criteria set forth by the Committee of Sponsoring Organizations of the
Treadway Commission (COSO) in Internal Control-Integrated Framework. Based on their assessment, the Partnership's management concluded
that, as of December 31, 2014, the Partnership's internal control over financial reporting was effective.



This annual report does
not include an attestation report of the Partnership’s registered public accounting firm regarding internal control over
financial reporting. Management’s report was not subject to the attestation by the Partnership’s registered public
accounting firm pursuant to rules of the Securities and Exchange Commission that permit the Partnership to provide only management’s
report in this annual report.

Changes in Internal Control
Over Financial Reporting.

There have been no significant
changes in the Partnership’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under
the Exchange Act) during the fourth quarter of 2013 that have materially affected, or are reasonably likely to materially affect,
the Partnership’s internal control over financial reporting.

ITEM
9B. OTHER INFORMATION

On
February 19, 2015, the Company filed Form 8-K detailing the results of the proxy vote on November 21, 2014. A majority of the Limited
Partners have elected to liquidate and sell the assets of the Fund.







PART
III

ITEM 10. DIRECTORS, EXECUTIVE
OFFICERS AND CORPORATE GOVERNANCE.

The Partnership has no directors
or executives officers of its own.  The following biographical information is presented for the officers of DSI Properties,
Inc., a General Partner of the Partnership, as well as RJC Capital Management, LLC and JWC Capital Management, LLC. The General
Partners have principal responsibility for the Partnership’s affairs.

DSI Properties, Inc.

Robert J. Conway,
80, has been President and a member of the Board of Directors of DSI Properties, Inc. since 1973.He has also been President
and a member of the Board of Directors of Diversified Securities, Inc., since 1965. Mr. Conway is also a licensed California real
estate broker, and received a Bachelor of Science Degree from Marquette University with majors in Corporate Finance and Real Estate.

Joseph W. Stok, 92,
has been a member of the Board of Directors of DSI Properties, Inc. since 1994, a Vice President of Diversified Securities, Inc.
since 1973, and an Account Executive with Diversified Securities, Inc. since 1967.Richard P. Conway, 47, was elected to the Board of Directors of DSI Properties, Inc. on September 30th of 2011. At the same
time, he was also appointed as Executive Vice President of both DSI Properties, Inc. and Diversified Securities, Inc. He has been
Chief Financial Officer of DSI Properties, Inc. since 2009 and an Account Executive with Diversified Securities, Inc. since 1987. RJC Capital Management, LLC and JWC Capital Management, LLC.
The two LLCs (descriptions above) are those of Robert J. Conway and Joseph W. Conway, the initial General Partners of Registrant.
On September 12, 2011, Joseph W. Conway, one of the original founders of DSI Properties, Inc. passed away after more than 40 years
of service to the company. His legacy and contributions cannot be overestimated, however, his imprint will continue to serve the
companies which he helped to create. He will be fondly remembered and sorely missed by all of us at the DSI family of companies.
Joseph’s son, Thomas J. Conway, is currently the executor of his estate, and the controlling member of JWC Capital Management,
LLC.

As the Partnership itself
has no directors or executive officers, it has no audit, nominating or other committees.

ITEM 11. EXECUTIVE COMPENSATION

None of the directors or
officers of the General Partners received any direct remuneration from the Partnership during the years ended December 31, 2014
or 2013.

ITEM 12. SECURITY OWNERSHIP
OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table sets
forth certain information regarding the beneficial ownership of the Partnership's limited partnership units as of December 31,
2014 by (i) each person known to beneficially own more than 5% of the Partnership's limited partnership units, and (ii) each officer
of the General Partners of the Partnership.

|Title of Class               | Name of Beneficial Owner | Number of LP Units Beneficially Held(1) | Percent of Class(2)
|---------------------------- | ------------------------ | --------------------------------------- | -------------------
|Limited Partnership Interest | Robert J. Conway         | 349 - Direct                            | 1.45               
|Limited Partnership Interest | Joseph W. Stok           | 110 - Direct                            | Less than 1%       
|Limited Partnership Interest | Richard P. Conway        | 94 - Direct                             | Less than 1%       

(1) Unless otherwise indicated,
the address for each listed director or officer is c/o 6700 E. Pacific Coast Hwy. #150, Long Beach, CA 90803. As used in this table,
"beneficial ownership" means the sole or shared power to vote or direct the voting or to dispose or direct the disposition
of any security.

(2) As of December 31, 2014,
no person owned more than 5% of the limited partnership units of record, nor was any person known by the Partnership to beneficially
own more than 5% thereof.

ITEM 13. CERTAIN RELATIONSHIPS
AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The Partnership has no employees
and depends on the General Partners and their affiliates for the management and administration of all Partnership activities. The
Partnership Agreement provides for certain payments to affiliates for services and reimbursement of certain expenses incurred by
affiliates on behalf of the Partnership.

Under the Agreement of Limited
Partnership, the General Partners are allocated 1% of the net profits or losses from operations of the Partnership. During 2014
an aggregate of $8,368 was allocated to the General Partners, and during 2013 an aggregate of $5,464 was allocated to the General
Partners. In addition, under the Limited Partnership Agreement the General Partners are entitled to receive a percentage, of any
cash distribution from the sale, other disposition, or refinancing of properties of the Partnership, based on a formula set forth
in the Limited Partnership Agreement. As there were no sales or refinancing of Partnership properties during 2014, no such fees
were paid during this year.

In addition, the general partners are entitled to receive
an incentive management fee for supervising the operations of the Partnership, equal to 9% per annum of the cash available for
distribution on a cumulative basis, calculated as cash generated from operations less capital expenditures. During 2014 the General
Partners earned an incentive management fee of $56,531, and during 2013 the General Partners earned an incentive management fee
of $58,946.

All of the Partnership’s properties were purchased
from Dahn Corporation ("Dahn"). Dahn is not affiliated with the Partnership, but is affiliated with other partnerships
in which DSI Properties, Inc. is a general partner The Partnership has entered into management agreements with Dahn to operate
its mini-storage facilities. Each agreement provides for a management fee equal to 5% of gross revenue from operations, defined
as the entire amount of all receipts from the renting or leasing of storage compartments and sale of locks. The management agreements
are renewable annually. During 2014 and 2013 the Partnership paid Dahn management fees of $114,261 and $100,614, respectively.
Amounts payable to Dahn at December 31, 2014 and 2013, were $10,031and $7,739, respectively.

None of the General Partner's
directors is “independent” under the independence standards established by the Securities and Exchange Commission,
as all directors are employed by a General Partner.

ITEM 14. PRINCIPAL ACCOUNTING
FEES AND SERVICES

Audit Fees

The aggregate fees for professional
services rendered by Anton & Chia, LLP for the audit of the Partnership's annual financial statements and for reviews of the
financial statements included in the Partnership's Quarterly Reports on Form 10-Q for 2014 were
$43,000and for 2013 were $42,000.

Other Fees

The Partnership did not
pay Anton & Chia, LLP any Non-Audit-Related Fees, Tax Fees, or other fees during 2014 and 2013.

PART IV

ITEM 15. EXHIBITS, FINANCIAL
STATEMENT SCHEDULES

(1) Financial Statements

See Index to Financial Statements
and Supplemental Schedule in Item 8.

(2) Financial Statement
Schedules

See Index to Financial Statements
and Supplemental Schedule in Item 8.

(3) Exhibits

13 Annual Report Letter to Limited Partners
31.1 Rule 13a-14(a)/15d-14(a) Certification: Principal Executive Officer
31.2 Rule 13a-14(a)/15d-14(a) Certification: Principal Financial Officer
32.1 Section 1350 Certification: Principal Executive Officer
32.2 Section 1350 Certification: Principal Financial Officer

101.INS	XBRL Instance Document*
101.SCH	XBRL Taxonomy Extension Schema Document*
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document*
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document*
101.LAB	XBRL Taxonomy Extension Label Linkbase Document*
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document*

*Pursuant to Rule 406T of Regulation
S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus
for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of
the Securities Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

SIGNATURES

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

DSI REALTY INCOME FUND VII,

a California Limited Partnership
by: DSI Properties, Inc., a California Corporation,
as General Partner

By: /s/ ROBERT J. CONWAY

Dated: March 31, 2015

ROBERT J. CONWAY,(President, Chief
Executive Officer and Director)

By: /s/ RICHARD P. CONWAY

Dated: March 31, 2015

RICHARD P. CONWAY,(Executive Vice President,
Chief Financial Officer)

Pursuant to the requirements
of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant and in
the capacities and on the date indicated.

DSI REALTY INCOME FUND VII,

a California Limited Partnership
by: DSI Properties, Inc., a California corporation, as
General Partner

By: /s/ ROBERT J. CONWAY

Dated: March 31, 2015

ROBERT J. CONWAY,(President, Chief
Executive Officer and Director)

By: /s/ RICHARD P. CONWAY

Dated: March 31, 2015

RICHARD P. CONWAY,(Executive Vice President, Chief Financial Officer)























EXHIBIT 13

2014 ANNUAL REPORT TO
LIMITED PARTNERS OF
DSI REALTY INCOME FUND VII

Dear Limited Partner:

This report contains the
Partnership's balance sheets as of December 31, 2014 and 2013 and the related statements of income, changes in partners' equity
(deficit) and cash flows for each of the two years ended December 31, 2014 accompanied by a report of Independent Registered Public
Accounting firm. The Partnership's properties were each purchased for all cash and funded solely from subscriptions for limited
partnership interests without the use of mortgage financing.

Your attention is directed
to the section entitled Management's Discussion and Analysis of Financial Condition and Results of Operations for the General Partners'
discussion and analysis of the financial statements and operations of the Partnership.

Average occupancy levels
and revenue per square foot for each of the Partnership's properties for the years ended December 31, 2014 and 2013 were as follows:



|              |         |        | 2014      | 2013     
|------------- | ------- | ------ | --------- | ---------
|              | Parcel  |        | (Average) | (Average)
|              | Size    | Date   | Rentable  | Revenue  
|Location      | (Acres) | Opened | Sq. Ft.   | Sq. Ft.  
|Chico, CA     | 1.97    | Jul-84 | 39,343    | 7.87     
|La Verne, CA  | 2.78    | Apr-85 | 52,410    | 10.20    
|Littleton, CO | 3.07    | Oct-85 | 45,788    | 11.48    
|Riverside, CA | 2.92    | Jan-85 | 61,027    | 7.13     
|Fairfield, CA | 2.29    | Aug-84 | 41,010    | 12.04    



All of the properties and assets of
DSI Realty Income Fund VI (the “Fund”) were sold to affiliates of Smart Stop Self Storage for anaggregate gross sale price of $16,840,000(the
“Sale”). The Sale was approved by the affirmative vote of the holders of approximately 55.6% of the outstanding units
of limited partnership interests in the Fund (the “Units”) in accordance with

the proxy statement of the Fund dated November 21, 2014 (the “Proxy
Statement”).

We will keep you informed
of the activities of your Fund as they develop. If you have any questions, please contact us at your convenience at (562) 493-3022.
If you would like a copy of the Partnership's Annual Report on Form 10-K for the year ended December 31, 2014, which was filed
with the Securities and Exchange Commission (which report includes the enclosed Financial Statements), we will forward a copy of
the report to you upon written request.

Very truly yours,

DSI REALTY INCOME FUND
VII

By: DSI Properties, Inc.

By/s/ ROBERT J. CONWAY

ROBERT J. CONWAY, President







EXHIBIT
31.1Rule 13a-14(a)/15d-14(a) Certification

I, Robert J. Conway, certify
that:

1. I have reviewed this annual
report on Form 10-K of DSI Realty Income Fund VII;

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

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

4. The registrant's other
certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange
Act Rules 13a-15(e) and 15d-15(e) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and
15d-15(f)), for the registrant and have:

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

b) evaluated the effectiveness
of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation;

c)   evaluated
the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
and

d) disclosed in this report
any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal
quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably
likely to materially affect, the registrant's internal control over financial reporting.

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

a) all significant deficiencies
and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to
adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) any fraud, whether or
not material, that involves management or other employees who have a significant role in the registrant's internal control over
financial reporting.

Date: March 31, 2015

/s/ ROBERT J. CONWAY
_______________________________

Robert J. Conway
President of DSI Properties, Inc., General Partner (chief executive officer)







EXHIBIT
31.2Rule 13a-14(a)/15d-14(a) Certification

I, Richard P. Conway, certify
that:

1. I have reviewed this annual
report on Form 10-K of DSI Realty Income Fund VII;

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

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

4. The registrant's other
certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange
Act Rules 13a-15(e) and 15d-15(e) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and
15d-15(f)), for the registrant and have:

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

b) evaluated the effectiveness
of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation;

c)   evaluated
the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
and

d) disclosed in this report
any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal
quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably
likely to materially affect, the registrant's internal control over financial reporting.

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

a) all significant deficiencies
and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to
adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) any fraud, whether or
not material, that involves management or other employees who have a significant role in the registrant's internal control over
financial reporting.

Date: March 31, 2015

/s/ RICHARD P. CONWAY

__________________________________

Richard P. Conway
Executive Vice President of DSI Properties, Inc., General Partner (chief financial officer)







EXHIBIT 32.1

CERTIFICATION PURSUANT
TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection
with the Annual Report of DSI Realty Income Fund VII (the "Partnership") on Form 10-K for the period ending December
31, 2014 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Robert J. Conway,
President of DSI Properties, Inc., General Partner of the Partnership, and performing the functions of chief executive officer
of the Partnership, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies
with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained
in the Report fairly presents, in all material respects, the financial condition and result of operations of the Partnership.

/s/ ROBERT J. CONWAY

___________________________________

Robert J. Conway
President of DSI Properties, Inc., General Partner (chief executive officer)

March 31, 2015







EXHIBIT 32.2

CERTIFICATION PURSUANT
TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual
Report of DSI Realty Income Fund VII (the "Partnership") on Form 10-K for the period ending December 31, 2014 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"), I, Richard P. Conway, Executive Vice President
of DSI Properties, Inc., General Partner of the Partnership, and performing the functions of chief financial officer of the Partnership,
certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies
with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained
in the Report fairly presents, in all material respects, the financial condition and result of operations of the Partnership.

/s/ RICHARD P. CONWAY

__________________________________

Richard P. Conway
Executive Vice President of DSI Properties, Inc., General Partner (chief financial officer)

March 31, 2015