SECURITIES AND EXCHANGE COMMISSION
                   WASHINGTON, D.C. 20549


                          FORM 10-Q


         QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
           OF THE SECURITIES EXCHANGE ACT OF 1934


              For Quarter Ended September 30, 2004
              Commission File Number 33-19316


       Qualified Housing Partners Limited Partnership

   (Exact name of registrant as specified in its charter)


        North Carolina                      56-1589469
 (State or other jurisdiction            (I.R.S. Employer
incorporation or organization)        Identification Number)

                          Suite 220
                     4700 Homewood Court
                Raleigh, North Carolina 27609
     (Address of principal executive offices)(Zip Code)


  Registrant's telephone number, including area code:
                        (919)787-4243


Indicate by a 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 such shorter period the registrant has
been 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 is an accelerated filer (as
defined by Rule 12b-2 of the Act.).  Yes                  No  X

As of September 30, 2004, there were 8,673 units of limited partnership
interests in registrant outstanding, $1,000 per unit, and the aggregate
value of such units was $8,673,000.  Of such units, 4,371 having an
aggregate value of $4,371,000, were held by limited partners deemed
by the registrant to be non-affiliates.









                           PART I

                    FINANCIAL INFORMATION
       QUALIFIED HOUSING PARTNERS LIMITED PARTNERSHIP





Item 1:  Financial Statements

     - Consolidated Balance Sheets

     - Unaudited Consolidated Statements of Income and
       Expenses (Three Months)

     - Unaudited Consolidated Statements of Income and
       Expenses (Nine Months)

     - Unaudited Consolidated Statements of Cash Flows

     - Unaudited Notes to Financial Statements




Item 2:  Management's Discussion

     - Liquidity and Capital Resources

     - Results of Operations

     - Tax Credits



Item 4:  Controls and Procedures

The Partnership carried out an evaluation under the supervision
and with the participation of the Partnership's management,
including the Partnership's Chief Executive Officer and Chief
Financial Officer, of the effectiveness of the design and
operation of the Partnership's disclosure controls and procedures
as of September 30, 2004, pursuant to Securities Exchange Act
Rule 13a-15(e). Based upon that evaluation, the Chief Executive
Officer and Chief Financial Officer concluded that the
Partnership's disclosure controls and procedures are effective
in timely alerting them to material information relating to the
Partnership required to be included in the Partnership's
periodic SEC Filings. There were no significant changes in
the Partnership's internal controls or in other factors that
could significantly affect these controls during the most recent
fiscal quarter.




QUALIFIED HOUSING PARTNERS LIMITED PARTNERSHIP

CONSOLIDATED BALANCE SHEETS
September 30, 2004 and December 31, 2003

                                             09/30/04      12/31/03
                                            (Unaudited)    (*)
ASSETS
Rental Properties
  Land                                       $1,326,402     $1,326,402
  Buildings                                  34,773,704     34,757,798
  Furniture & Fixtures                        2,362,449      2,357,006

                                             38,462,555     38,436,206

Accumulated Depreciation                    (14,159,595)   (13,484,052)

                                             24,302,960     24,952,154

Cash                                            374,659        305,114
Other Assets                                  2,047,401      1,877,743

TOTAL ASSETS                                $26,725,020    $27,145,011



LIABILITIES AND PARTNERS' CAPITAL

Liabilities Applicable to Rental
     Properties                             $23,994,919    $24,070,613
Other Liabilities                             1,469,923      1,325,332

Total Liabilities                            25,464,842     25,395,945

Minority Interests in Subsidiary
     Operating Partnerships                   1,693,407      1,698,076

Partners' Capital                              (433,229)        50,990

TOTAL LIABILITIES AND PARTNERS'
     CAPITAL                                $26,725,020    $27,145,011



See accompanying notes.
*Derived from audited consolidated balance sheet.











CONSOLIDATED STATEMENTS OF INCOME AND EXPENSES
Three Months Ended September 30, 2004 and 2003
(Unaudited)

                                            07/01/04-     07/01/03-
                                            09/30/04      09/30/03

Revenue
     Rent                                  $957,502     $1,024,639
     Other                                   20,649         14,966

                                            978,151      1,039,605

Rental Expense
     Interest                               130,302        136,216
     Depreciation                           225,182        215,415
     Repairs and Maintenance                288,369        290,273
     Utilities                               91,600         88,525
     Real Estate Taxes                       94,171         91,317
     Management Fees                        123,159        111,065
     Advertising                              2,485          2,339
     Other                                  170,234        163,080

                                          1,125,502      1,098,230

Loss from Rental Activities                (147,351)       (58,625)

Other Income (Expenses)
     Interest Income                             19             18
     Management Fees                              0        (21,141)
     Administrative Costs                    (5,875)        (8,745)

Loss Before Deducting Minority
  Interests in Subsidiary Operating
  Partnerships                             (153,207)       (88,493)

Minority Interests in Losses of
  Subsidiary Operating Partnerships           1,491            600

     Net Loss                             ($151,716)      ($87,893)

Net Loss Allocated to General Partners      ($1,517)         ($879)

Net Loss Allocated to Limited Partners     (150,199)       (87,014)

     Net Loss                             ($151,716)      ($87,893)


Net Loss per Limited Partnership Unit       ($17.32)       ($10.03)


Average Number of Limited Partnership
  Units Outstanding                           8,673          8,673



See accompanying notes.
CONSOLIDATED STATEMENTS OF INCOME AND EXPENSES
Nine Months Ended September 30, 2004 and 2003
(Unaudited)

                                            01/01/04-    01/01/03-
                                            09/30/04     09/30/03

Revenue
     Rent                                $2,896,975     $3,061,303
     Other                                   56,722         63,309

                                          2,953,697      3,124,612

Rental Expense
     Interest                               406,169        438,629
     Depreciation                           675,543        659,730
     Repairs and Maintenance                870,825        852,842
     Utilities                              264,293        273,177
     Real Estate Taxes                      276,054        272,210
     Management Fees                        371,108        346,769
     Advertising                              7,018          5,918
     Other                                  520,960        495,186

                                          3,391,970      3,344,461

Loss from Rental Activities                (438,273)      (219,849)

Other Income (Expenses)
     Interest Income                             45             61
     Management Fees                        (13,000)       (63,422)
     Administrative Costs                   (37,421)       (36,463)

Loss Before Deducting Minority
  Interests in Subsidiary Operating
  Partnerships                             (488,649)      (319,673)

Minority Interests in Losses of
  Subsidiary Operating Partnerships           4,429          2,224

     Net Loss                             ($484,220)     ($317,449)

Net Loss Allocated to General Partners      ($4,842)       ($3,174)

Net Loss Allocated to Limited Partners     (479,378)      (314,275)

     Net Loss                             ($484,220)     ($317,449)


Net Loss per Limited Partnership Unit       ($55.27)       ($36.24)


Average Number of Limited Partnership
  Units Outstanding                           8,673          8,673



See accompanying notes.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine Months Ended September 30, 2004 and 2003
(Unaudited)

                                              01/01/04-      01/01/03-
                                              09/30/04       09/30/03

Cash Flows from Operating Activities
  Net Loss                                   ($484,220)     ($317,449)

Adjustments to Reconcile Net Loss
  To Net Cash Provided by Operating
  Activities:
     Depreciation                              675,543        659,730
     Minority Interest in Losses of
       Subsidiary Operating Partnerships        (4,429)        (2,224)
     Change in Other Assets and
       Liabilities                             (15,066)       325,062

Net Cash Provided by Operating Activities      171,828        665,119

Cash Flows from Investing Activities
     Purchases of Buildings and Equipment      (26,349)      (146,466)

Net Cash Used by Investing Activities          (26,349)      (146,466)

Cash Flows from Financing Activities
     Principal Payments on Borrowings          (75,694)      (483,270)
     Return of Equity to Minority Investors       (240)          (225)

Net Cash Used by Financing Activities          (75,934)      (483,495)

Net Increase (Decrease) in Cash                 69,545         35,158
     Cash Beginning                            305,114        211,526
     Cash Ending                              $374,659       $246,684



See accompanying notes.


















NOTES TO FINANCIAL STATEMENTS (Unaudited)

Note A - Basis of Presentation

The unaudited consolidated financial statements included
herein have been prepared in accordance with the rules and
regulations of the Securities and Exchange Commission.  In
the opinion of the Partnership, all adjustments which are
considered necessary for a fair statement of the results for
the interim periods have been made; all such adjustments are
of a normal recurring nature.  These consolidated financial
statements, which do not include all disclosures included
in the annual financial statements, should be read in
conjunction with the consolidated financial statements
and notes thereto included in the Partnership's latest
annual report on Form 10-K.  The results of operations for
the nine months ended September 30, 2004 are not necessarily
indicative of the results to be achieved for the year.


Note B - Net Loss Per Limited Partnership Unit

Net loss per limited partnership Unit is based upon the net
loss allocated to the limited partners and is computed using
the number of Units outstanding of 8,673.


Note C - Liabilities Applicable to Rental Properties

Liabilities applicable to rental properties at September 30,
2004 consist of $23,994,919 of permanent mortgage loans to
Subsidiary Operating Partnerships.

























Note D - Related Party Transactions

The accompanying consolidated financial statements reflect
transactions between Qualified Housing Partners Limited
Partnership ("QHP") and its general partners or affiliates
and between the various Subsidiary Operating Partnerships
and their general partners or affiliates.

Frederick Investment Corporation, the Managing General
Partner of QHP, is a general or special limited partner in
each of the Operating Partnerships.  Each Operating
Partnership also has one or more other general partners (the
"Local General Partners").  Following is a summary of
related party transactions for the three months ended
September 30, 2004.

                                  QHP General    Local General
Items Paid or Payable              Partners       Partners of
                                                   Operating
                                                 Partnerships

Management Fees                          $0          $108,000

Reimbursable Operating Expenses      $4,800                $0


Following is a summary of related party transactions for the
nine months ended September 30, 2004.

                                  QHP General    Local General
Items Paid or Payable              Partners       Partners of
                                                   Operating
                                                 Partnerships

Management Fees                     $13,000          $324,000

Reimbursable Operating Expenses     $21,300                $0




















MANAGEMENT'S DISCUSSION

Accounting/SEC Reporting Issues

Because QHP is a public company, its interests are
with the SEC, and therefore it is subject to new
financial reporting and other compliance requirements
of the Sarbanes-Oxley Act of 2002.  Even though
Sarbanes-Oxley was enacted to prevent fraud such as
that which occurred at WorldCom and Enron, it still
applies to small untraded entities including QHP.
Because of Sarbanes-Oxley, QHP's auditor,Dixon Hughes,
PLLC has stated that they intend to resign effective
December 31, 2004.  It is important to note that their
resignation is not the result of any disagreement over
accounting or financial issues, and that they have
agreed to continue preparing the tax returns. QHP
approached other accounting firms who also, because of
Sarbanes-Oxley, decided not to perform the audit.  If
an audit is not performed, and QHP remains a public
company, QHP will be out of compliance with the SEC.

Dixon Hughes and its predecessor have served as
QHP's auditor since QHP's formation sixteen years ago.
Their reasons for resigning include QHP's unusual structure
and its insufficient financial resources to pay the
substantial cost of compliance with Sarbanes-Oxley.  QHP
is an upper tier partnership whose only assets are limited
partnership interests in lower tier partnerships.  Dixon
Hughes is unwilling to accept the additional risk imposed
by Sarbanes-Oxley if it must audit the upper tier
partnerships only and rely upon others to audit the lower
tier partnerships, where all the assets are held and the
business takes place.  QHP does not have the authority
to require the lower tier partnerships to retain Dixon
Hughes.  Even if another auditing firm can be found,
it is highly unlikely that the cost will be affordable
to QHP.

Without an audit, QHP will be out of compliance
unless it deregisters with the SEC.  If the total number
of investors falls below 300, QHP can elect to
deregister and the Sarbanes-Oxley requirements will not
apply.  318 investors have elected to divest within the
past year, which will bring the number of investors
remaining down to 328.  If another 29 investors elect
to divest, the general partners will be able to
deregister and will do so.

Many investors are divesting as part of an exit
strategy the general partners proposed in 2003.
Divesting investors can gain federal tax savings of
up to 34% of their original investment, and still receive
cash distributions, if any, through December 31, 2018.
The exit strategy was explained in letters over the past
year, and is summarized in "Divestiture" below.

Liquidity and Capital Resources

Net of the Subsidiary Operating Partnerships, QHP held
approximately $26,000 in cash and liquid investments at
September 30, 2004.  These assets will be held as working
capital.

At September 30, 2004, there were 403 holders of limited
partnership Units.


Results of Operations

The Partnership's loss from rental activities, including
depreciation, during the third quarter of 2004 is $147,351
as compared with a loss of $58,625 for the same period in
2003.  Third quarter revenue decreased as a result of
increased vacancy loss at Litton, the largest property in
QHP's portfolio.  Repairs and maintenance continue to
increase as the properties age.  In addition, management
fees, approved by USDA-Rural Development, on a number of
properties have also increased.

Occupancy at the 24-unit property located in Dimmitt, TX
increased slightly from 58% at the end of the second quarter,
2004, to 62.5% as of the date of this report.  Local
management is still in discussions with the taxing
authority to work out a payment plan for 2003 taxes.  No
payments have been made to-date.

Divestiture

In November 2003, the general partners offered an exit
strategy whereby many investors could divest and receive
a one-time tax benefit.  Investors electing that strategy
assign their interest to the general partner, and, by doing
so, will (a) receive a one-time Federal tax benefit of up
to 34% of their investment plus any state tax savings, (b)
still receive cash distributions (if any) until December
31, 2018, and (c) stop future reporting of QHP results in
their tax returns.  As of the date of this report, 318
investors owning 4,387 units had elected divestiture.
Those investors who divested in divested in 2003, received
their additional tax benefit on their 2003 tax return and
will receive no further mailings from the Partnership unless
there are cash distributions.  Those who are divesting in
2004 will continue to receive QHP mailings through the
remainder of the year and will receive their final k-1
in March 2005.  If you are interested in divesting,
contact Ramona Logan at either (919) 787-4243 or
investor_svcs@hotmail.com.

Form 10-Q
A copy of the Partnership's Quarterly Report on Form 10-Q
as filed with the Securities and Exchange Commission will
be furnished without charge to any investor upon written
request.
                           PART II

                      OTHER INFORMATION


Item 1.   Legal Proceedings

               None

Item 2.   Changes in Securities

               None

Item 3.   Defaults upon Senior Securities

               None

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

               None

Item 5.   Other Information

               None

Item 6.   Exhibits

               (a)  Exhibits

                    4     The Partnership Agreement is Exhibit A
                          to the Prospectus that is part of the
                          Registration Statement on Form S-11,
                          Number 33-19316 and effective May 20,
                          1988, the final form of which was filed
                          on May 20, 1988 pursuant to Rule 424(b),
                          and is incorporated herein by reference.

                    31.1  Section 302 Certification by Chief
                          Executive Officer

                    31.2  Section 302 Certification by Chief
                          Financial Officer

                    32.1  Section 906 Certification by Chief
                          Executive Officer

                    32.2  Section 906 Certification by Chief
                          Financial Officer








SIGNATURES


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



                            Frederick Investment Corporation
                            A General Partner


Date:   November 15, 2004    By:  /s/ George F. Marshall
                                  George F. Marshall, President
                                  (Chief Executive Officer)



Date:   November 15, 2004    By:  /s/ Jenny C. Petri
                                  Jenny C. Petri, Vice President
                                  (Chief Financial Officer)



Date:   November 15, 2004    By:  /s/ George F. Marshall
                                  George F. Marshall
                                  A General Partner





























EXHIBIT 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

Section 302 Certification

I, George F. Marshall, certify that:

I have reviewed this quarterly report on Form 10-Q of Qualified
Housing Partners Limited Partnership, a North Carolina limited
partnership (the "registrant");

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;

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;

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)) for the registrant and have:

     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, is made known
     to us by others within those entities, particularly
     during the period in which this report is being prepared;

     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

     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 that
     has materially affected, or is reasonably likely to
     materially affect, the registrant's internal control over
     financial reporting;

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):


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

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




Date:   November 15, 2004    By:  /s/ George F. Marshall
                                  George F. Marshall, General Partner
                                  Chief Executive Officer








































EXHIBIT 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

Section 302 Certification

I, Jenny C. Petri, certify that:

I have reviewed this quarterly report on Form 10-Q of Qualified
Housing Partners Limited Partnership, a North Carolina limited
partnership (the "registrant");

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;

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;

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)) for the registrant and have:

     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, is made known
     to us by others within those entities, particularly
     during the period in which this report is being prepared;

     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

     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 that
     has materially affected, or is reasonably likely to
     materially affect, the registrant's internal control over
     financial reporting;

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):


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

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



                                 FREDERICK INVESTMENT CORPORATION

Date:   November 15, 2004    By:  /s/ Jenny C. Petri
                                  Jenny C. Petri, Vice President
                                  (Chief Financial Officer)







































EXHIBIT 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
(18 U.S.C.ss.1350)

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
(18 U.S.C.ss.1350), the undersigned, George F. Marshall,
Chief Executive Officer of Qualified Housing Partners
Limited Partnership, a North Carolina limited partnership,
does hereby certify, to his knowledge, that:

The Quarterly Report on Form 10-Q for the period ended
September 30, 2004 of the Partnership (the "Report")
fully complies with the requirements of Section 13(a)
or 15(d) of the Securities Exchange Act of 1934, and
the information contained in the Report fairly presents,
in all material respects, the financial condition and
results of operations of the Partnership.



Date:   November 15, 2004    By:  /s/ George F. Marshall
                                  George F. Marshall
                                  General Partner
                                  (Chief Executive Officer)






























EXHIBIT 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
(18 U.S.C.ss.1350)

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
(18 U.S.C.ss.1350), the undersigned, Jenny C. Petri,
Chief Financial Officer of Qualified Housing Partners
Limited Partnership, a North Carolina limited partnership,
does hereby certify, to her knowledge, that:

The Quarterly Report on Form 10-Q for the period ended
September 30, 2004 of the Partnership (the "Report")
fully complies with the requirements of Section 13(a)
or 15(d) of the Securities Exchange Act of 1934, and
the information contained in the Report fairly presents,
in all material respects, the financial condition and
results of operations of the Partnership.

                            FREDERICK INVESTMENT CORPORATION

Date:   November 15, 2004    By:  /s/ Jenny C. Petri
                                  Jenny C. Petri, Vice President
                                  (Chief Financial Officer)