CENTURY PROPERTIES FUND XVIII, 10KSB, 1999-03-30

CENTURY PROPERTIES FUND XVIII
10KSB, 1999-03-30
REAL ESTATE

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FORM 10-KSB-ANNUAL OR TRANSITIONAL REPORT UNDER
SECTION 13 OR 15(D)
(As last amended by 34-31965, eff. 4/26/93)

[X] Annual Report Under Section 13 or 15(d) of the Securities and Exchange Act
of 1934 [No Fee Required]

For the fiscal year ended December 31, 1998

[ ] Transition Report Under Section 13 or 15(d) of the Securities Exchange Act
of 1934 [No Fee Required]

For the transition period from to

Commission file number 0-11934

CENTURY PROPERTIES FUND XVIII
(Name of small business insurer in its charter)

California 94-2834149
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

55 Beattie Place, P.O. Box 1089
Greenville, South Carolina 29602
(Address of principal executive offices)

(864) 239-1000
Issuer's telephone number

Securities registered under Section 12(b) of the Exchange Act:

None

Securities registered under Section 12(g) of the Exchange Act:

Units of Limited Partnership Interest
(Title of class)

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

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will 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-KSB or any amendment to
this Form 10-KSB.[X]

State issuer's revenues for its most recent fiscal year. $ 4,893,000

State the aggregate market value of the voting partnership interests held by
non-affiliates computed by reference to the price at which the partnership
interests were sold, or the average bid and asked prices of such partnership
interests, as of December 31, 1998. No market exists for the limited
partnership interests of the Registrant, and, therefore, no aggregate market
value can be determined.

DOCUMENTS INCORPORATED BY REFERENCE
NONE

PART I

ITEM 1. DESCRIPTION OF BUSINESS

Century Properties Fund XVIII (the "Partnership" or "Registrant") was organized
in July 1982, as a California limited partnership under the Uniform Limited
Partnership Act of the California Corporations Code. Fox Partners, a
California general partnership, is the general partner of the Registrant. The
general partners of Fox Partners are Fox Capital Management Corporation (the
"Managing General Partner" or "FCMC"), a California corporation, Fox Realty
Investors ("FRI"), a California general partnership, and Fox Partners 82, a
California general partnership. NPI Equity Investments II, Inc. ("NPI Equity"),
a Florida Corporation, is the Managing General Partner of FRI. The Managing
General Partner and NPI equity are subsidiaries of Apartment Management and
Investment Company, a publicly traded real estate investment trust (See
"Transfer of Control"). The Partnership agreement provides that the Partnership
is to terminate on December 31, 2020, unless terminated prior to such date.

The principal business of the Registrant is to operate and hold real properties
for investment. From February 1983 to September 1983, the Registrant offered and
sold pursuant to a Registration Statement filed with the Securities and Exchange
Commission, 75,000 Units of Limited Partnership Interest (the "Units") at a
purchase price of $1,000 per Unit for an aggregate of $75,000,000. The net
proceeds of this offering were used to acquire twelve income-producing real
properties. The Registrant's original property portfolio was geographically
diversified with properties acquired in seven states. The Registrant's
acquisition activities were completed in June 1984 and since then the principal
activity of the Registrant has been managing its portfolio. In the period from
1987 through February 1994, ten properties were sold or otherwise disposed. The
Registrant continues to own and operate two remaining properties. See "Item 2.
Description of Properties".

A further description of the Partnership's business is included in "Management's
Discussion and Analysis or Plan of Operation" included in "Item 6" of this Form
10-KSB.

Affiliates of the Managing General Partner, currently hold 26.941.5 Units
representing approximately 35.92% of the total outstanding Units. These Units
were acquired through private transactions and a December 17, 1997 tender offer.
21,513 Units were acquired on January 19, 1996 from Deforest Ventures I, L.P.
("Deforest"), the entity which tendered for Units in the Partnership in 1994 and
1995, and certain of its affiliates. An additional 5,259.5 Units were acquired
on January 30, 1998 at a price of $75 per Unit pursuant to the December 1997
tender offer. The remaining Units were acquired through private transactions. As
a result of its ownership of approximately 35.92% of the Units, these affiliates
could be in a position to significantly influence all voting decisions with
respect to the Partnership. Under the Partnership Agreement, unitholders
holding a majority of the Units are entitled to take action with respect to a
variety of matters. When voting on matters, these affiliates would in all
likelihood vote the Units it acquired in a manner favorable to the interest of
the Managing General Partner because of its affiliation with the Managing
General Partner. However, Deforest from whom one of the affiliates acquired its
Units, had agreed for the benefit of non-tendering unitholders, that it would
vote the 21,513 units it had acquired: (i) against any increase in compensation
payable to the Managing General Partner or to affiliates; and (ii) on all other
matters submitted by it or its affiliates, in proportion to the votes cast by
non-tendering unitholders. Except for the foregoing, no other limitations are
imposed on such affiliates' ability to influence voting decisions with respect
to the partnership.

The Partnership has no full time employees. The Managing General Partner is
vested with full authority as to the general management and supervision of the
business and affairs of the Partnership. The Limited Partners have no right to
participate in the management or conduct of such business and affairs. Property
Management services were performed at the Partnership's properties by an
affiliate of the Managing General Partner.

The real estate business in which the Partnership is engaged is highly
competitive. There are other residential properties within the market area of
the Partnership's properties. The number and quality of competitive properties,
including those which may be managed by an affiliate of the Managing General
Partner in such market area, could have a material effect on the rental market
for the apartments at the Registrant's properties and the rents that may be
charged for such apartments. While the Managing General Partner and its
affiliates are a significant factor in the United States in the apartment
industry, competition for the apartments is local. In addition, various limited
partnerships have been formed by the General Partners and/or their affiliates to
engage in business which may be competitive with the Registrant.

Both the income and expenses of operating the remaining properties owned by the
Partnership are subject to factors outside of the Partnership's control, such as
an oversupply of similar properties resulting from overbuilding, increases in
unemployment or population shifts, reduced availability of permanent mortgage
financing, changes in zoning laws, or changes in patterns or needs of users. In
addition, there are risks inherent in owning and operating residential
properties because such properties are susceptible to the impact of economic and
other conditions outside of the control of the Partnership.

There have been, and it is possible there may be other Federal, state and local
legislation and regulations enacted relating to the protection of the
environment. The Partnership is unable to predict the extent, if any, to which
such new legislation or regulations might occur and the degree to which such
existing or new legislation or regulations might adversely affect the property
owned by the Partnership.

The Partnership monitors its property for evidence of pollutants, toxins and
other dangerous substances, including the presence of asbestos. In certain
cases environmental testing has been performed, which resulted in no material
adverse conditions or liabilities. In no case has the Partnership received
notice that it is a potentially responsible party with respect to an
environmental clean up site.

Transfer of Control

Pursuant to a series of transactions which closed on October 1, 1998 and
February 26, 1999, Insignia Financial Group, Inc. and Insignia Properties Trust
merged into Apartment Investment and Management Company, a publicly traded real
estate investment trust, with AIMCO being the surviving corporation (the
"Insignia Merger"). As a result, AIMCO ultimately acquired a 100% ownership
interest in Insignia Properties Trust ("IPT"), the entity which controls the
Managing General Partner. The Managing General Partner does not believe that
this transaction will have a material effect on the affairs and operations of
the Partnership.

ITEM 2. DESCRIPTION OF PROPERTIES:

The following table sets forth the Partnership's investments in properties:

Date of
Property Purchase Type of Ownership Use

Overlook Point Apartments 07/83 Fee ownership subject to Residential rental
Salt Lake City, Utah first mortgage 304 units

Oak Run Apartments 11/83 Fee ownership subject to Residential rental
Dallas, Texas first mortgage (1) 420 units

(1) The property is held by a limited liability company in which the Registrant
is the sole owner.

SCHEDULE OF PROPERTIES:

Set forth below for each of the Registrant's properties is the gross carrying
value, accumulated depreciation, depreciable life, method of depreciation and
Federal tax basis.

Carrying Accumulated Federal

Property Value Depreciation Rate Method Tax Basis

(in thousands) (in thousands)

Overlook Point Apartments $ 10,253 $ 4,684 5-30 yrs (1) $6,387

Oak Run Apartments 16,890 5,789 5-30 yrs (1) 1,802

$ 27,143 $10,473 $8,189

(1) Straight-line.

See "Note A" of the "Notes to Consolidated Financial Statements" included in
"Item 7." for a description of the Partnership's depreciation policy.

SCHEDULE OF PROPERTY INDEBTEDNESS:

The following table sets forth certain information relating to the loans
encumbering the Registrant's properties.

Principal Principal

Balance At Stated Balance

December 31, Interest Period Maturity Due At

Property 1998 Rate Amortized Date Maturity (1)

Overlook Point Apartments $ 8,975 6.33% 30 years 09/2005 $ 8,127

Oak Run Apartments 10,482 7.36% 30 years 10/2004 9,728

$19,457 $17,855

(1) See Item 7, Financial Statements "Note C" for information with respect to
the Registrant's ability to prepay these loans and other more specific
details as to the terms of the loans.

All mortgage agreements include non-recourse provisions which limit the lenders'
remedies in the event of default to the specific property collateralizing each
loan.

In August 1998, the Partnership refinanced the mortgage indebtedness encumbering
Overlook Point Apartments. The total indebtedness refinanced was approximately
$7,907,000. The new indebtedness, in the principal amount of $9,000,000,
carries a stated interest rate of 6.33% per annum and is being amortized over 30
years, with a balloon payment due September 1, 2005. The proceeds from the
refinancing enabled the Partnership to pay-off its previous first mortgage note.
As a condition of the loan, the Partnership was required to deposit
approximately $99,000 into a Repair Escrow Fund in order to pay the costs of
certain repairs on the property over the next twelve months.

SCHEDULE OF RENTAL RATES AND OCCUPANCY:

Average annual rental rates and occupancy for 1998 and 1997 for each property:

Average Annual Average

Rental Rates Occupancy

Property 1998 1997 1998 1997

Overlook Point Apartments $ 7,296/unit $ 7,125/unit 93% 93%

Oak Run Apartments 6,805/unit 6,454/unit 92% 96%

The decrease in occupancy at Oak Run Apartments is a result of a surplus of
newer properties in the immediate submarket.

As noted under "Item 1. Description of Business", the real estate industry is
highly competitive. All of the properties of the Partnership are subject to
competition from other apartment complexes in the area. The Managing General
Partner believes that all of the properties are adequately insured. The multi-
family residential properties' lease terms are for one year or less. No
individual tenant leases 10% or more of the available rental space. All of the
properties is are in good physical condition subject to normal depreciation and
deterioration as is typical for assets of this type and age.

REAL ESTATE TAXES AND RATES:

Real estate taxes and rates in 1998 for each property were:

1998 1998

Billing Rate

(in thousands)

Overlook Point Apartments $ 87 1.27%

Oak Run Apartments 349 2.54%

CAPITAL IMPROVEMENTS:

During 1998, the Partnership spent $152,000 on capital improvements at Overlook
Point, primarily consisting of tennis court additions, carpet replacements and
other building improvements in an effort to increase the property's curb appeal.
These improvements were funded from cash flow. Based on a report received from
an independent third party consultant analyzing necessary exterior improvements
and estimates made by the Managing General Partner on the interior improvements,
it is estimated that the property requires approximately $293,000 of capital
improvements over the near-term. The Partnership has budgeted, but is not
limited to, capital improvements of approximately $364,000 for 1999 at this
property, which includes parking lot improvements, roof and flooring
replacements and structural repairs.

During 1998, the Partnership spent $132,000 on capital improvements at Oak Run
Apartments, primarily consisting of balcony repairs, carpet replacements and
equipment additions. These improvements were funded from cash flow. Based on a
report received from an independent third party consultant analyzing necessary
exterior improvements and estimates made by the Managing General Partner on the
interior improvements, it is estimated that the property requires approximately
$125,000 of capital improvements over the near-term. The Partnership has
budgeted, but is not limited to, capital improvements of approximately $316,000
for 1999 at this property, which consists primarily of parking lot improvements,
structural repairs, interior decoration and carpet replacement.

The capital improvements planned for 1999 at the Partnership's properties will
be made only to the extent of cash available from operations and Partnership
reserves.

ITEM 3. LEGAL PROCEEDINGS

In March 1998, several putative unit holders of limited partnership units of the
Partnership commenced an action entitled ROSALIE NUANES, ET AL. V. INSIGNIA
FINANCIAL GROUP, INC., ET AL. in the Superior Court of the State of California
for the County of San Mateo. The plaintiffs named as defendants, among others,
the Partnership, the Managing General Partner and several of their affiliated
partnerships and corporate entities. The complaint purports to assert claims on
behalf of a class of limited partners and derivatively on behalf of a number of
limited partnerships (including the Partnership) which are named as nominal
defendants, challenging the acquisition by Insignia and entities which were, at
the time, affiliates of Insignia ("Insignia Affiliates") of interests in certain
general partner entities, past tender offers by Insignia Affiliates as well as a
recently announced agreement between Insignia and AIMCO. The complaint seeks
monetary damages and equitable relief, including judicial dissolution of the
Partnership. On June 25, 1998, the Managing General Partner filed a motion
seeking dismissal of the action. In lieu of responding to the motion, the
plaintiffs have filed an amended complaint. The Managing General Partner has
filed demurrers to the amended complaint which were heard during February 1999.
No ruling on such demurrers has been received. The Managing General Partner
does not anticipate that costs associated with this case, if any, to be material
to the Partnership's overall operations.

On July 30, 1998, certain entities claiming to own limited partnership interests
in certain limited partnerships whose general partners were, at the time,
affiliates of Insignia filed a complaint entitled EVEREST PROPERTIES, LLC. V.
INSIGNIA FINANCIAL GROUP, INC., ET AL. in the Superior Court of the State of
California, county of Los Angeles. The action involves 44 real estate limited
partnerships (including the Partnership) in which the plaintiffs allegedly own
interests and which Insignia Affiliates allegedly manage or control (the
"Subject Partnerships"). This case was settled on March 3, 1999. The
Partnership is responsible for a portion of the settlement costs. The expense
will not have a material effect on the Partnership's operations.

The Partnership is unaware of any other pending or outstanding litigation that
is not of a routine nature arising in the ordinary course of business.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

During the quarter ended December 31, 1998, no matter was submitted to a vote of
unit holders through the solicitation of proxies or otherwise.

PART II

ITEM 5. MARKET FOR THE PARTNERSHIP'S COMMON EQUITY AND RELATED SECURITY HOLDER
MATTERS

The Partnership, a publicly-held limited partnership, sold 75,000 Limited
Partnership Units aggregating $75,000,000. The Partnership currently has 75,000
units outstanding held by 4,816 Limited Partners of record. Affiliates of the
Managing General Partner owned 26,941.5 or 35.922% at December 31, 1998. No
public trading market has developed for the Units, and it is not anticipated
that such a market will develop in the future.

During the years ended December 31, 1998 and 1997, distributions of $1,593,000
($21.03 per limited partnership unit) and $650,000, ($8.57 per limited
partnership unit) respectively, were paid from surplus cash. Future cash
distributions will depend on the levels of net cash generated from operations,
refinancings, property sales and the availability of cash reserves. The
Partnership's distribution policy will be reviewed on a quarterly basis.
Subsequent to the Partnership's year-end a distribution from surplus cash of
$750,000 ($9.91 per limited partnership unit) was paid during January 1999.
There can be no assurance, however, that the Partnership will generate
sufficient funds from operations after required capital expenditures to permit
any additional distributions to its partners in 1999 or subsequent periods.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

The matters discussed in this Form 10-KSB contain certain forward-looking
statements and involve risks and uncertainties (including changing market
conditions, competitive and regulatory matters, etc.) detailed in the disclosure
contained in this Form 10-KSB and the other filings with the Securities and
Exchange Commission made by the Registrant from time to time. The discussion of
the Registrant's business and results of operations, including forward-looking
statements pertaining to such matters, does not take into account the effects of
any changes to the Registrant's business and results of operation. Accordingly,
actual results could differ materially from those projected in the forward-
looking statements as a result of a number of factors, including those
identified herein.

This item should be read in conjunction with the consolidated financial
statements and other items contained elsewhere in this report.

Results of Operations

The Partnership's net income for the year ended December 31, 1998 was $442,000
as compared to $565,000 for the year ended December 31, 1997. (See "Note D" of
the financial statements for a reconciliation of these amounts to the
Partnership's federal taxable losses). The decrease in net income is primarily
attributable to the extraordinary gain on extinguishment of debt from the Oak
Run refinancing which was recognized in 1997 as discussed below.

Revenues of the Registrant remained relatively constant for the comparable
periods as an increase in rental income was offset by a decrease in other
income. Despite a decrease in average occupancy at Oak Run Apartments, rental
income increased due to an increase in average annual rental rates. Other
income decreased due to the decrease in income from corporate units and deposit
forfeitures at Overlook Point Apartments. A Company that was relocating used
the apartment complex for short term, temporary housing during 1997.

Total expenses of the Registrant for the year ended December 31, 1998 also
remained relatively constant to the same period last year as a decrease in
operating expense was significantly offset by increases in interest and property
tax expense. Operating expense decreased as a result of major landscaping
projects that were performed at both investment properties as well as interior
building improvements at which were made at Oak Run in 1997. Interest expense
increased as the result of the refinancing of Overlook Point Apartments in
August 1998, which increased the outstanding debt. Property tax expense
increased due to an increase in the assessed value of Oak Run Apartments, which
was partially offset by a slight decrease in its tax rate.

General and administrative and depreciation expense remained relatively constant
for the comparable periods. Included in general and administrative expenses at
both December 31, 1998 and 1997 are management reimbursements to the Managing
General Partner allowed under the Partnership Agreement. In addition, costs
associated with the quarterly and annual communications with investors and
regulatory agencies and the annual audit required by the Partnership Agreement
are also included.

In August 1998, the Partnership refinanced the mortgage indebtedness encumbering
Overlook Point Apartments. The total indebtedness refinanced was approximately
$7,907,000. The new indebtedness, in the principal amount of $9,000,000,
carries a stated interest rate of 6.33% per annum and is being amortized over 30
years, with a balloon payment due September 1, 2005. The proceeds from the
refinancing enabled the Partnership to pay-off its previous first mortgage note.
As a condition of the loan, the Partnership was required to deposit
approximately $99,000 into a repair escrow fund in order to pay the costs of
certain repairs on the property over the next twelve months.

In September 1997, the Partnership refinanced the mortgage indebtedness
encumbering Oak Run Apartments. The total indebtedness refinanced was
approximately $10,155,000. The new indebtedness, in the principal amount of
$10,600,000, carries a stated interest rate of 7.36% and matures in October
2004. The proceeds from the refinancing enabled the Partnership to pay-off its
previous first mortgage note and a participating note held by a former lender.
As a result of the refinancing, the Partnership recognized a net gain of
approximately $108,000 upon extinguishment of the debt. This net gain is due to
$241,000 in debt forgiveness as a result of the participating note holder
accepting a reduced pay-off less the write-off of $133,000 in unamortized loan
costs. Additionally, the Partnership capitalized loan costs of approximately
$244,000 relating to the refinancing. In order to obtain the new loan on Oak
Run Apartments, the lender required that the property be conveyed to a single
purpose entity. As a result, the property was conveyed from the Partnership to
Oak Run, L.L.C., a South Carolina limited liability company. The Partnership is
the sole owner of Oak Run, L.L.C.

As part of the ongoing business plan of the Partnership, the Managing General
Partner monitors the rental market environment of its investment properties to
assess the feasibility of increasing rents maintaining or increasing occupancy
levels and protecting the Partnership from increases in expense. As part of
this plan, the Managing General Partner attempts to protect the Partnership from
the burden of inflation-related increases in expenses by increasing rents and
maintaining a high overall occupancy level. However, due to changing market
conditions, which can result in the use of rental concessions and rental
reductions to offset softening market conditions, there is no guarantee that the
Managing General Partner will be able to sustain such a plan.

Capital Resources and Liquidity

At December 31, 1998, the Partnership had cash and cash equivalents of
approximately $1,477,000 as compared to approximately $2,025,000 at December 31,
1997. The decrease in cash and cash equivalents is due to $494,000 of cash used
in investing activities and $857,000 of cash used in financing activities which
was offset by $803,000 of cash provided by operating activities. Cash used in
investing activities consisted of capital improvements and net deposits to
escrow accounts maintained by the mortgage lender. Cash used in financing
activities consisted of monthly payments of principal made on the mortgages
encumbering the Partnership's properties, repayment of mortgage principal to
extinguish debt and partner distributions, offset by proceeds from refinancing
the mortgage debt. The Partnership invests its working capital reserves in
money market accounts.

An affiliate of the Managing General Partner has made available to the
Partnership a credit line of up to $150,000 per property owned by the
Partnership. At the present time, the Partnership has no outstanding amounts
due under this line of credit. Based on present plans, the Managing General
Partner does not anticipate the need to borrow in the near future. Other than
cash and cash equivalents, the line of credit is the Partnership's only unused
source of liquidity.

The sufficiency of existing liquid assets to meet future liquidity and capital
expenditure requirements is directly related to the level of capital
expenditures required at the properties to adequately maintain the physical
assets and other operating needs of the Registrant and to comply with federal,
state, and local legal and regulatory requirements. The Partnership has
budgeted, but is not limited to approximately $680,000 in capital improvements
for the Partnership's properties in 1999. Capital improvements include parking
lot improvements, roof and flooring replacements and structural repairs at
Overlook Point and parking lot improvements, structural repairs, interior
decoration and carpet replacement at Oak Run Apartments. The capital
expenditures will be incurred only if cash is available from operations or from
partnership reserves. To the extent that such budgeted capital improvements are
completed, the Registrant's distributable cash flow, if any, may be adversely
affected at least in the short term.

The Registrant's current assets are thought to be sufficient for any near-term
needs (exclusive of capital improvements) of the Registrant. The mortgage
indebtedness of $19,457,000 is amortized over thirty years with balloon payments
of $8,127,000 and $9,728,000 due on October 2004, and September 2005,
respectively. The Registrant's current assets are thought to be sufficient for
any near-term needs (exclusive of capital improvements) of the Registrant. The
Managing General Partner may attempt to refinance such indebtedness and/or sell
the properties prior to such maturity date. If the properties cannot be
refinanced or sold for a sufficient amount, the Partnership may risk losing such
properties through foreclosure.

Cash distributions from surplus cash of approximately $1,593,000 ($21.03 per
limited partnership unit) and $650,000 ($7.57 per limited partnership unit) were
made during the year ended December 31, 1998 and 1997, respectively. During the
first quarter of 1999, the Partnership made a distribution of $750,000 ($9.91
per limited partnership unit) from surplus cash. Future cash distributions will
depend on the levels of net cash generated from operations, refinancings,
property sales and the availability of cash reserves. The Partnership's
distribution policy will be reviewed on a quarterly basis. There can be no
assurance, however, that the Partnership will generate sufficient funds from
operations after required capital expenditures to permit any additional
distributions to its partners in 1999 or subsequent periods.

On December 17, 1997, an affiliate of the Managing General Partner (the
"Purchaser") commenced tender a offer for limited partnership interests in the
Partnership. The Purchaser offered to purchase up to 30,000 of the outstanding
units of limited partnership interest in the Partnership, at $70.00 per Unit,
net to the seller in cash. On January 30, 1998, the Purchaser acquired an
additional 5,259.5 Units at $70.00 per Unit pursuant to this tender offer.

Year 2000 Compliance

General Description of the Year 2000 Issue and the Nature and Effects of the
Year 2000 on Information Technology (IT) and Non-IT Systems

The Year 2000 issue is the result of computer programs being written using two
digits rather than four digits to define the applicable year. The Partnership
is dependent upon the Managing General Partner and its affiliates for management
and administrative services ("Managing Agent"). Any of the computer programs or
hardware that have date-sensitive software or embedded chips may recognize a
date using "00" as the year 1900 rather than the year 2000. This could result
in a system failure or miscalculations causing disruptions of operations,
including, among other things, a temporary inability to process transactions,
send invoices, or engage in similar normal business activities.

Over the past two years, the Managing Agent has determined that it will be
required to modify or replace significant portions of its software and certain
hardware so that those systems will properly utilize dates beyond December 31,
1999. The Managing Agent presently believes that with modifications or
replacements of existing software and certain hardware, the Year 2000 issue can
be mitigated. However, if such modifications and replacements are not made or
not completed in time, the Year 2000 issue could have a material impact on the
operations of the Partnership.

The Managing Agent's plan to resolve Year 2000 issues involves four Phases:
assessment, remediation, testing, and implementation. To date, the Managing
Agent has fully completed its assessment of all the information systems that
could be significantly affected by the Year 2000, and has begun the remediation,
testing and implementation phases on both hardware and software systems.
Assessments are continuing in regards to embedded systems. The status of each
is detailed below.

Status of Progress in Becoming Year 2000 Compliant, Including Timetable for
Completion of Each Remaining Phase

Computer Hardware:

During 1997 and 1998, the Managing Agent identified all of the computer systems
at risk and formulated a plan to repair or replace each of the affected systems.
In August 1998, the mainframe system used by the Managing Agent became fully
functional. In addition to the mainframe, PC-based network servers and routers
and desktop PCs were analyzed for compliance. The Managing Agent has begun to
replace each of the non-compliant network connections and desktop PCs and, as of
December 31, 1998, had completed approximately 75% of this effort.

The total cost to the Managing Agent to replace the PC-based network servers,
routers and desktop PCs is expected to be approximately $1.5 million of which
$1.3 million has been incurred to date. The remaining network connections and
desktop PCs are expected to be upgraded to Year 2000 compliant systems by March
31, 1999.

Computer software:

The Managing Agent utilizes a combination of off-the-shelf, commercially
available software programs as well as custom-written programs that are designed
to fit specific needs. Both of these types of programs were studied, and
implementation plans written and executed with the intent of repairing or
replacing any non-compliant software programs.

During 1998, the Managing Agent began converting the existing property
management and rent collection systems to its management properties Year 2000
compliant systems. The estimated additional costs to convert such systems at
all properties, is $200,000, and the implementation and the testing process is
expected to be completed by March 31, 1999.

The final software area is the office software and server operating systems.
The Managing Agent has upgraded all non-compliant office software systems on
each PC and has upgraded 80% of the server operating systems. The remaining
server operating systems are planned to be upgraded to be Year 2000 compliant by
March 31, 1999.

Operating Equipment:

The Managing Agent has operating equipment, primarily at the property sites,
which needed to be evaluated for Year 2000 compliance. In September 1997, the
Managing Agent began taking a census and inventory of embedded systems
(including those devices that use time to control systems and machines at
specific properties, for example elevators, heating, ventilating, and air
conditioning systems, security and alarm systems, etc.).

The Managing Agent has chosen to focus its attention mainly upon security
systems, elevators, heating, ventilating and air conditioning systems, telephone
systems and switches, and sprinkler systems. While this area is the most
difficult to fully research adequately, management has not yet found any major
non-compliance issues that put the Managing Agent at risk financially or
operationally. The Managing Agent intends to have a third-party conduct an
audit of these systems and report their findings by March 31, 1999.

Any of the above operating equipment that has been found to be non-compliant to
date has been replaced or repaired. To date, these have consisted only of
security systems and phone systems. As of December 31, 1998 the Managing Agent
has evaluated approximately 86% of the operating equipment for the Year 2000
compliance.

The total cost incurred for all properties managed by the Managing Agent as of
December 31, 1998 to replace or repair the operating equipment was approximately
$400,000. The Managing Agent estimates the cost to replace or repair any
remaining operating equipment is approximately $325,000, which is expected to be
completed by April 30, 1999.

The Managing Agent continues to have "awareness campaigns" throughout the
organization designed to raise awareness and report any possible compliance
issues regarding operating equipment within our enterprise.

Nature and Level of Importance of Third Parties and Their Exposure to the Year
2000

The Managing Agent continues to conduct surveys of its banking and other vendor
relationships to assess risks regarding their Year 2000 readiness. The Managing
Agent has banking relationships with three major financial institutions, all of
which have indicated their compliance efforts will be complete before May 1999.
The Managing Agent has updated data transmission standards with two of the three
financial institutions. The Managing Agent's contingency plan in this regard is
to move accounts from any institution that cannot be certified Year 2000
compliant by June 1, 1999.

The Partnership does not rely heavily on any single vendor for goods and
services, and does not have significant suppliers and subcontractors who share
information systems (external agent). To date the Partnership is not aware of
any external agent with a Year 2000 compliance issue that would materially
impact the Partnership's results of operations, liquidity, or capital resources.
However, the Partnership has no means of ensuring that external agents will be
Year 2000 compliant.

The Managing Agent does not believe that the inability of external agents to
complete their Year 2000 remediation process in a timely manner will have a
material impact on the financial position or results of operations of the
Partnership. However, the effect of non-compliance by external agents is not
readily determinable.

Costs to Address Year 2000

The total cost of the Year 2000 project to the Managing Agent is estimated at
$3.5 million and is being funded from operating cash flows. To date, the
Managing Agent has incurred approximately $2.8 million ($0.6 million expensed
and $2.2 million capitalized for new systems and equipment) related to all
phases of the Year 2000 project. Of the total remaining project costs,
approximately $0.5 million is attributable to the purchase of new software and
operating equipment, which will be capitalized. The remaining $0.2 million
relates to repair of hardware and software and will be expensed as incurred.
The Partnership's portion of these costs are not material.

Risks Associated with the Year 2000

The Managing Agent believes it has an effective program in place to resolve the
Year 2000 issue in a timely manner. As noted above, the Managing Agent has not
yet completed all necessary phases of the Year 2000 program. In the event that
the Managing Agent does not complete any additional phases, certain worst case
scenarios could occur. The worst case scenarios could include elevators,
security and heating, ventilating and air conditioning systems that read
incorrect dates and operate with incorrect schedules (e.g., elevators will
operate on Monday as if it were Sunday). Although such a change would be
annoying to residents, it is not business critical.

In addition, disruptions in the economy generally resulting from Year 2000
issues could also adversely affect the Partnership. The Partnership could be
subject to litigation for, among other things, computer system failures,
equipment shutdowns or failure to properly date business records. The amount of
potential liability and lost revenue cannot be reasonably estimated at this
time.

Contingency Plans Associated with the Year 2000

The Managing Agent has contingency plans for certain critical applications and
is working on such plans for others. These contingency plans involve, among
other actions, manual workarounds and selecting new relationships for such
activities as banking relationships and elevator operating systems.

ITEM 7. FINANCIAL STATEMENTS

CENTURY PROPERTIES FUND XVIII

LIST OF FINANCIAL STATEMENTS

Independent Auditors' Reports

Consolidated Balance Sheet - December 31, 1998

Consolidated Statements of Operations - Years ended December 31, 1998 and 1997

Consolidated Statements of Changes in Partners' (Deficit) Capital - Years ended
December 31, 1998 and 1997

Consolidated Statements of Cash Flows - Years ended December 31, 1998 and 1997

Notes to Consolidated Financial Statements

To the Partners
Century Properties Fund XVIII

Independent Auditors' Report

We have audited the accompanying consolidated balance sheet of Century
Properties Fund XVIII as of December 31, 1998, and the related consolidated
statements of operations, changes in partners' (deficit) capital and cash flows
for the year then ended. These financial statements are the responsibility of
the Partnership's management. Our responsibility is to express an opinion on
these financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material misstate-
ment. An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by the
Partnership's management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Century Properties
Fund XVIII at December 31, 1998, and the consolidated results of its operations
and its cash flows for the year then ended, in conformity with generally
accepted accounting principles.

/s/Ernst & Young LLP

Greenville, South Carolina
March 3, 1999

To the Partners
Century Properties Fund XVIII
Greenville, South Carolina
Independent Auditors' Report

We have audited the accompanying consolidated statements of operations, changes
in partners' (deficit) capital and cash flows of Century Properties Fund XVIII
(a limited partnership) (the "Partnership") and its subsidiary for the year
ended December 31, 1997. These consolidated financial statements are the
responsibility of the Partnership's management. Our responsibility is to
express an opinion on these consolidated financial statements based on our
audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the consolidated financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated results of operations and
cash flows of Century Properties Fund XVIII and its subsidiary for the year
ended December 31, 1997, in conformity with generally accepted accounting
principles.

/s/ Imowitz Koenig & Co., LLP
Certified Public Accountants

New York, N.Y.
January 23, 1998

CENTURY PROPERTIES FUND XVIII
CONSOLIDATED BALANCE SHEET
(in thousands, except unit data)
December 31, 1998

Assets

Cash and cash equivalents $ 1,477

Receivables and deposits 501

Restricted escrows 241

Other assets 403

Investment properties (Notes C and F)

Land $ 7,296

Buildings and related personal property 19,847

27,143

Less accumulated depreciation (10,473) 16,670

$ 19,292

Liabilities and Partners' Deficit

Liabilities

Accounts payable $ 21

Other liabilities 177

Accrued property taxes 348

Tenant security deposit liabilities 86

Mortgage notes payable (Notes C and F) 19,457

Partners' (Deficit) Capital

General partner $ (6,334)

Limited partners (75,000 units issued

and outstanding) 5,537 (797)

$ 19,292

See Accompanying Notes to Consolidated Financial Statements

CENTURY PROPERTIES FUND XVIII
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except unit data)

Years Ended December 31,

1998 1997

Revenues:

Rental income $ 4,616 $ 4,558

Other income 277 333

Total revenues 4,893 4,891

Expenses:

Operating 1,644 1,752

General and administrative 208 209

Depreciation 696 687

Interest 1,469 1,395

Property tax 434 391

Total expenses 4,451 4,434

Income before extraordinary item 442 457

Extraordinary item - gain on extinguishment

of debt (Note C) -- 108

Net income $ 442 $ 565

Net income allocated to general partner (9.9%) $ 44 $ 56

Net income allocated to limited partners (90.1%) 398 509

Net income $ 442 $ 565

Per limited partnership unit:

Income before extraordinary item $ 5.31 $ 5.49

Extraordinary item -- 1.30

Net income $ 5.31 $ 6.79

Surplus distributions per limited partnership unit $ 21.03 $ 8.57

See Accompanying Notes to Consolidated Financial Statements

CENTURY PROPERTIES FUND XVIII
CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' (DEFICIT) CAPITAL
(in thousands, except unit data)

Limited

Partnership General Limited

Units Partner Partners Total

Original capital contributions 75,000 $ -- $ 75,000 $ 75,000

Partners' (deficit) capital at

December 31, 1996 75,000 $ (6,411) $ 6,850 $ 439

Distributions to partners -- (7) (643) (650)

Net income for the year ended

December 31, 1997 -- 56 509 565

Partners' (deficit) capital at

December 31, 1997 75,000 (6,362) 6,716 354

Distributions to partners -- (16) (1,577) (1,593)

Net income for the year ended

December 31, 1998 -- 44 398 442

Partners' (deficit) capital at

December 31, 1998 75,000 $ (6,334) $ 5,537 $ (797)

See Accompanying Notes to Consolidated Financial Statements

CENTURY PROPERTIES FUND XVIII
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

Years Ended December 31,

1998 1997

Cash flows from operating activities:

Net income $ 442 $ 565

Adjustments to reconcile net income to

net cash provided by operating

activities:

Depreciation 696 687

Amortization of loan costs 43 41

Extraordinary item - gain on extinguishment of debt -- (108)

Interest added to note payable principal -- 23

Change in accounts:

Receivables and deposits (397) 311

Other assets (9) (8)

Accounts payable (41) (12)

Other liabilities 10 50

Accrued property taxes 53 5

Tenant security deposit liabilities 6 (30)

Net cash provided by

operating activities 803 1,524

Cash flows (used in) provided by investing activities:

Property improvements and replacements (284) (158)

Net (deposits to) receipts from restricted escrows (210) 201

Net cash (used in) provided by

investing activities (494) 43

Cash flows used in financing activities:

Proceeds from mortgage note payable 9,000 10,600

Repayment of mortgage notes payable (7,907) (10,155)

Loan costs paid (171) (244)

Payments on mortgage notes payable (186) (352)

Distributions to partners (1,593) (650)

Net cash used in financing activities (857) (801)

Net (decrease) increase in cash and cash equivalents (548) 766

Cash and cash equivalents at beginning of year 2,025 1,259

Cash and cash equivalents at end of year $ 1,477 $ 2,025

Supplemental disclosure of cash flow information:

Cash paid for interest $ 1,433 $ 1,266

Supplemental disclosure of non-cash financing

activities:

Accrued interest added to mortgage note payable $ -- $ 23

balance

See Accompanying Notes to Consolidated Financial Statements

CENTURY PROPERTIES FUND XVIII
Notes to Consolidated Financial Statements

NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

Organization:

Century Properties Fund XVIII (the "Partnership" or "Registrant") is a
California limited partnership organized in July 1982, to acquire and operate
residential apartment complexes. The Partnership's general partner is Fox
Partners. The general partners of Fox Partners are Fox Capital Management
Corporation (the "Managing General Partner" or "FCMC"), Fox Realty Investors
("FRI"), and Fox Partners 82. The Managing General Partner is an affiliate of
Apartment Investment and Management Company ("AIMCO"). See "Note B _ Transfer
of Control". As of December 31, 1998, the Partnership operates two residential
apartment complexes located in Texas and Utah. The partnership agreement
provides that the Partnership is to terminate on December 31, 2020 unless
terminated prior to such date. The directors and officers of the Managing
General Partner also serve as executive officers of AIMCO.

Principles of Consolidation:

The Partnership's financial statements include the accounts of the Partnership
and its wholly-owned subsidiary.

Allocations to Partners:

Net income, losses and cash available for distribution (excluding those arising
from the occurrence of sales or dispositions) of the Partnership will be
allocated (i) 9% to the General Partners and (ii) the remainder allocated 1% to
the General Partners and 99% to the Limited Partners on an annual basis.

In accordance with the Partnership Agreement, any gain from the sale or other
disposition of Partnership properties shall be allocated: (i) first to the
General Partner to the extent they are entitled to receive distributions of cash
pursuant to the above and from the sale or disposition of properties (ii) next,
until such time as the General Partner does not have a deficit in its capital
account, 10% to the General Partner and 90% to the Limited Partnership Unit
Holders, and (iii) to the Limited Partnership Unit Holders.

Cash from sales or other dispositions, or refinancing and working capital
reserves are distributed 99% to the Limited Partnership Unit Holders and 1% to
the General Partner, until: (i) each Limited Partnership Unit Holder receives an
amount which equals the total of their original invested capital contributed in
exchange for his Limited Partnership Units and (ii) a sum equal to 8% per year,
as determined on a cumulative, non-compounded basis, on the Adjusted Invested
Capital, as adjusted from time to time, of such Limited Partnership Unit Holder,
calculated from the first day of the month in which he was admitted as a Limited
Partner. Thereafter, the General Partner will receive 15% of any additional cash
from sales or refinancing and working capital reserve available for distribution
and, finally, the remainder of such being allocated 99% to the Limited
Partnership Unit Holders and 1% to the General Partner. Upon sale of all
properties and termination of the Partnership, the General Partner may be
required to contribute certain funds to the Partnership in accordance with the
Partnership Agreement.

Depreciation:

Depreciation is calculated by the straight-line method over the estimated lives
of the rental properties and related personal property.

Cash and Cash Equivalents:

Cash and cash equivalents include cash on hand and in banks, money market
accounts, and certificates of deposit with original maturities of less than 90
days. At certain times, the amount of cash deposited at a bank may exceed the
limit on insured deposits.

Security Deposits:

The Partnership requires security deposits from lessees for the duration of the
lease and such deposits are included in receivables and deposits. The security
deposits are refunded when the tenant vacates, provided the tenant has not
damaged its space and is current on its rental payments.

Leases:

The Partnership generally leases apartment units for twelve-month terms or less.
The Partnership recognizes income as earned on its leases. In addition, the
Managing General Partner's policy is to offer rental concessions during
particularly slow months or in response to heavy competition from other similar
complexes in the area. Concessions are charged against rental income as
incurred.

Loan Costs:

Loan costs of $452,000 are included in other assets in the accompanying balance
sheet and are being amortized on a straight-line basis over the life of the
loans. At December 31, 1998, accumulated amortization is $51,000. Amortization
of loan costs is included in interest expense in the accompanying statement of
operations.

Investment Properties:

Investment properties consist of two apartment complexes and are stated at cost.
Acquisition fees are capitalized as a cost of real estate. In accordance with
Financial Accounting Standards Board Statement No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of,"
the Partnership records impairment losses on long-lived assets used in
operations when events and circumstances indicate that the assets might be
impaired and the undiscounted cash flows estimated to be generated by those
assets are less than the carrying amounts of those assets. No adjustments for
impairment of value were recorded in the years ended December 31, 1998 or 1997.

Income Taxes:

Taxable income or loss of the Partnership is reported in the income tax returns
of its partners. Accordingly, no provision for income taxes is made in the
financial statements of the Partnership.

Fair Value of Financial Instruments:

Statement of Financial Accounting Standards ("SFAS") No. 107, "Disclosures about
Fair Value of Financial Instruments", as amended by SFAS No. 119, "Disclosures
about Derivative Financial Instruments and Fair Value of Financial Instruments",
requires disclosure of fair value information about financial instruments,
whether or not recognized in the balance sheet, for which it is practicable to
estimate fair value. Fair value is defined in the SFAS as the amount at which
the instruments could be exchanged in a current transaction between willing
parties, other than in a forced or liquidation sale. The Partnership believes
that the carrying amount of its financial instruments (except for long term
debt) approximates their fair value due to the short term maturity of these
instruments. The fair value of the Partnership's long term debt, after
discounting the scheduled loan payments to maturity, approximates its carrying
balance.

Use of Estimates:

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes.
Actual results could differ from those estimates.

Segment Reporting:

In June 1997, the Financial Accounting Standards Board issued Statement of
Financial Standards No. 131, Disclosure about Segments of an Enterprise and
Related Information ("Statement 131"), which is effective for years beginning
after December 15, 1997. Statement 131 established standards for the way that
public business enterprises report information about operating segments in
annual financial statements and requires that those enterprises report selected
information about operating segments in interim financial reports. It also
establishes standards for related disclosures about products and services,
geographic areas, and major customers. See "Note G" for detailed disclosure
about the Registrant's segments.

Advertising Costs:

The Partnership expenses the costs of advertising as incurred. Advertising
costs of approximately $92,000 and $79,000 for the years ended December 31, 1998
and 1997 were charged to operating expense.

Reclassifications:

Certain reclassifications have been made to the 1997 balances to conform to the
1998 presentation.

NOTE B - TRANSFER OF CONTROL

Pursuant to a series of transactions which closed on October 1, 1998 and
February 26, 1999, Insignia Financial Group, Inc. and Insignia Properties Trust
merged into AIMCO, with AIMCO being the surviving corporation (the "Insignia
Merger"). As a result, AIMCO ultimately acquired a 100% ownership interest in
Insignia Properties Trust ("IPT"), the entity which controls the Managing
General Partner. The Managing General Partner does not believe that this
transaction will have a material effect on the affairs and operations of the
Partnership.

NOTE C - MORTGAGE NOTES PAYABLE

The principle terms of mortgage notes payable are as follows:

Principal Monthly Principal

Balance At Payment Stated Balance

December 31, Including Interest Maturity Due At

Property 1998 Interest Rate Date Maturity

(in thousands) (in thousands)

Overlook Point Apartments $ 8,975 $ 56 6.33% 09/2005 $ 8,127

Oak Run Apartments 10,482 73 7.36% 10/2004 9,728

$19,457 $129 $17,855

Scheduled principal payments on mortgage notes payable subsequent to December
31, 1998 are as follows (in thousands):

1999 $ 215

2000 230

2001 246

2002 264

2003 283

Thereafter 18,219

$19,457

All mortgage agreements include non-recourse provisions which limit the lenders'
remedies in the event of default to the specific property collateralizing each
loan.

In September 1997, the Partnership refinanced the mortgage indebtedness
encumbering Oak Run Apartments. The total indebtedness refinanced was
approximately $10,155,000. The new indebtedness, in the principal amount of
$10,600,000, carries a stated interest rate of 7.36% per annum and is being
amortized over 30 years, with a balloon payment due October 1, 2004. The
proceeds from the refinancing enabled the Partnership to pay-off its previous
first mortgage note and a participating note held by a former lender. As a
result of the refinancing, the Partnership recognized a net gain of
approximately $108,000 upon extinguishment of the debt. This gain is due to the
write-off of $133,000 in unamortized loan costs and due to $241,000 in debt
forgiveness as a result of the participating note holder accepting a reduced
pay-off. In order to obtain the new loan on Oak Run Apartments, the lender
required that the property be conveyed to a single purpose entity. As a result,
the property was conveyed from the Partnership to Oak Run, L.L.C., a South
Carolina limited liability company. The Partnership is the sole owner of Oak
Run, L.L.C.

NOTE D - INCOME TAXES

Differences between the net income as reported and Federal taxable income (loss)
result primarily from depreciation over different methods and lives and on
differing cost bases. The following is a reconciliation of reported net income
and Federal taxable income (loss):

1998 1997

(in thousands)

Net income as reported $ 442 $ 565

Add (deduct):

Depreciation differences 20 98

Other 103 (887)

Federal taxable income (loss) $ 565 $ (224)

Federal taxable income (loss)

per limited partnership unit $ 6.79 $(2.69)

The following is a reconciliation between the Partnership's reported amounts and
Federal tax basis of net liabilities (in thousands):

1998

Net liabilities as reported $ (797)

Land and buildings 1,195

Accumulated depreciation (9,676)

Syndication and distribution costs 9,592

Prepaid rent 103

Other 37

Net assets - Federal tax basis $ 454

NOTE E - TRANSACTIONS WITH AFFILIATED PARTIES

The Partnership has no employees and is dependent on the Managing General
Partner and its affiliates for the management and administration of all
partnership activities. The Partnership Agreement provides for certain payments
to affiliates for services and as reimbursement of certain expenses incurred by
affiliates on behalf of the Partnership. The following payments were made to the
Managing General Partner and affiliates during the year ended December 31, 1998
and 1997:

1998 1997

(in thousands)

Property management fees (included in operating

expenses) $ 244 $ 242

Reimbursement for services of affiliates

(included in operating, general and

administrative expenses, and investment

properties) (1) 148 134

(1) Included in "reimbursements for services of affiliates" for the years ended
December 31, 1998 and 1997, is approximately $2,000 and $3,000,
respectively, in reimbursements for construction oversight costs. As well,
approximately $18,000 and $27,000 in loan costs were paid for the year
ended December 31, 1998 and 1997, respectively. These costs have been
capitalized and are being amortized over the term of the loan.

During the years ended December 31, 1998 and 1997, affiliates of the Managing
General Partner were entitled to receive compensation for providing property
management services. The Registrant paid to such affiliates $244,000 and
$242,000 for the years ended December 31, 1998 and 1997 respectively.

An affiliate of the Managing General Partner received reimbursement of
accountable administrative expenses amounting to approximately $148,000 and
$134,000 for the years ended December 31, 1998 and 1997, respectively.

For the period from January 1, 1997, to August 31, 1997, the Partnership insured
its properties under a master policy through an agency affiliated with the
Managing General Partner with an insurer unaffiliated with the General Partner.
An affiliate of the Managing General Partner acquired, in the acquisition of a
business, certain financial obligations from an insurance agency which was later
acquired by the agent who placed the master policy. The agent assumed the
financial obligations to the affiliate of the Managing General Partner who
receives payment on these obligations from the agent. The amount of the
Partnership's insurance premiums that accrued to the benefit of the affiliate of
the Managing General Partner by virtue of the agent's obligations was not
significant.

On December 17, 1997, an affiliate of the Managing General Partner (the
"Purchaser") commenced a tender offer for limited partnership interests in the
Partnership. The Purchaser offered to purchase up to 30,000 of the outstanding
units of limited partnership interest in the Partnership, at $70.00 per Unit,
net to the seller in cash. On January 30, 1998, the Purchaser acquired an
additional 5,259.5 units pursuant to this tender offer.

Affiliates of the Managing General Partner, currently hold 26.941.5 Units
representing approximately 35.92% of the total outstanding Units. As a result
of its ownership, these affiliates could be in a position to significantly
influence all voting decisions with respect to the Partnership. Under the
Partnership Agreement, unitholders holding a majority of the Units are entitled
to take action with respect to a variety of matters. When voting on matters,
these affiliates would in all likelihood vote the Units it acquired in a manner
favorable to the interest of the Managing General Partner because of its
affiliation with the Managing General Partner. However with respect to 21,513
Units, such affiliates are required to vote such Units: (i) against any increase
in compensation payable to the Managing General Partner or to affiliates; and
(ii) on all other matters submitted by it or its affiliates, in proportion to
the votes cast by non-tendering unitholders. Except for the foregoing, no other
limitations are imposed on such affiliates' ability to influence voting
decisions with respect to the Partnership.

NOTE F - INVESTMENT PROPERTIES AND ACCUMULATED DEPRECIATION

Initial Cost

To Partnership

(in thousands)

Cost

Buildings Capitalized

and Related (Removed)

Personal Subsequent to

Description Encumbrances Land Property Acquisition

Overlook Point Apartments $ 8,975 $ 1,082 $ 8,225 $ 946

Oak Run Apartments 10,482 6,218 8,713 1,959

Total $ 19,457 $ 7,300 $ 16,938 $ 2,905

Gross Amount at Which Carried

At December 31, 1998

Buildings

And Related Year

Personal Accumulated of Date Depreciable

Description Land Property Total Depreciation Construction Acquired Life-Years

(in thousands)

Overlook Point Apartments $1,078 $ 9,175 $10,253 $ 4,684 1984 7/83 5-30 yrs

Oak Run Apartments 6,218 10,672 16,890 5,789 1979 11/83 5-30 yrs

Total $7,296 $ 19,847 $27,143 $10,473

</TABLE>

Reconciliation of "Investment Properties and Accumulated Depreciation":

Years Ended December 31,

1998 1997

(in thousands)

Investment Properties

Balance at beginning of year $ 26,859 $ 26,701

Property Improvements 284 158

Balance at end of year $ 27,143 $ 26,859

Years Ended December 31,

1998 1997

(in thousands)

Accumulated Depreciation

Balance at beginning of year $ 9,777 $ 9,090

Additions charged to expense 696 687

Balance at end of year $ 10,473 $ 9,777

The aggregate cost of the investment properties for Federal income tax purposes
at December 31, 1998 and 1997, are $28,338,000 and $28,054,000, respectively.
The accumulated depreciation taken for Federal income tax purposes at
December 31, 1998 and 1997 is $20,149,000 and $19,473,000, respectively.

NOTE G - SEGMENT REPORTING

Description of the types of products and services from which the reportable
segment derives its revenues:

As defined by SFAS No. 131, Disclosures about Segment of an Enterprise and
Related Information, Century Properties Fund XVIII has one reportable segment:
residential properties. The Partnership's residential property segment consists
of two apartment complexes in Salt Lake City, Utah and Dallas, Texas. The
Partnership rents apartment units to people for terms that are typically less
than twelve months.

Measurement of segment profit or loss:

The Partnership evaluates performance based on net income. The accounting
policies of the reportable segment are the same as those described in the
summary of significant accounting policies.

Factors management used to identify the enterprise's reportable segment:

The Partnership's reportable segment consists of investment properties that
offer similar products and services. Although each of the investment properties
is managed separately, they have been aggregated into one segment as they
provide services with similar types of products and customers.

Segment information for the years 1998 and 1997 is shown in the tables below (in
thousands). The 'Other' column includes Partnership administration related
items and income and expense not allocated to the reportable segment.

1998 Residential Other Totals
Rental income $ 4,616 $ - $ 4,616
Other income 208 69 277
Interest expense 1,469 - 1,469
Depreciation 696 - 696
General and administrative expense - 208 208
Segment profit (loss) 581 (139) 442
Total assets 18,110 1,182 19,292
Capital expenditures 284 - 284

1997 Residential Other Totals
Rental income $ 4,558 $ - $ 4,558
Other income 265 68 333
Interest expense 1,395 - 1,395
Depreciation 687 - 687
General and administrative expense - 209 209
Extraordinary item - gain on
extinguishment of debt 108 - 108
Segment profit (loss) 706 (141) 565
Total assets 17,877 1,631 19,508
Capital expenditures 158 - 158

NOTE H - LEGAL PROCEEDINGS

In March 1998, several putative unit holders of limited partnership units of the
Partnership commenced an action entitled ROSALIE NUANES, ET AL. V. INSIGNIA
FINANCIAL GROUP, INC., ET AL. in the Superior Court of the State of California
for the County of San Mateo. The plaintiffs named as defendants, among others,
the Partnership, the Managing General Partner and several of their affiliated
partnerships and corporate entities. The complaint purports to assert claims on
behalf of a class of limited partners and derivatively on behalf of a number of
limited partnerships (including the Partnership) which are named as nominal
defendants, challenging the acquisition by Insignia and entities which were, at
the time, affiliates of Insignia ("Insignia Affiliates") of interests in certain
general partner entities, past tender offers by Insignia Affiliates as well as a
recently announced agreement between Insignia and AIMCO. The complaint seeks
monetary damages and equitable relief, including judicial dissolution of the
Partnership. On June 25, 1998, the Managing General Partner filed a
motion seeking dismissal of the action. In lieu of responding to the motion, the
plaintiffs have filed an amended complaint. The Managing General Partner has
filed demurrers to the amended complaint which were heard during February 1999.
No ruling on such demurrers has been received. The Managing General Partner does
not anticipate that costs associated with this case, if any, to be material to
the Partnership's overall operations.

The Partnership is unaware of any other pending or outstanding litigation that
is not of a routine nature arising in the ordinary course of business.

Item 8. Changes in and Disagreements with Accountant on Accounting and
Financial Disclosures

Effective November 10, 1998, the Registrant dismissed its prior Independent
Auditors Imowitz Koenig and Co., LLP ("Imowitz"). Imowitz' Independent
Auditor's Report on the Registrant's financial statements for calendar year
ended December 31, 1997 did not contain any adverse opinion or a disclaimer of
opinion, and were not qualified or modified as to uncertainty, audit scope or
accounting principles. The decision to change Independent Auditors was approved
by the Managing General Partner's directors. During the calendar year ended
1997 and through November 10, 1998, there were no disagreements between the
Registrant and Imowitz on any matter of accounting principles or practices,
financial statement disclosure, or auditing scope of procedure which
disagreements if not resolved to the satisfaction of Imowitz, would have caused
it to make references to the subject matter of the disagreements in connection
with its reports.

Effective November 24, 1998, the Registrant engaged Ernst & Young LLP as its
Independent Auditors. During the last two calendar years and through November
10, 1998, the Registrant did not consult Ernst and Young LLP regarding any of
the matters or events set forth in Item 304(a)(2)(i) and (ii) of Regulation S-B.

PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

Neither the Registrant, nor Fox Partners ("Fox"), the general partner of the
Registrant, has any officers or directors. Fox Capital Management Corporation
(the "Managing General Partner" or "FCMC"), the managing general partner of Fox,
manages and controls substantially all of the Registrant's affairs and has
general responsibility and ultimate authority in all matters affecting its
business.

The names and ages of, as well as the positions and offices held by, the
executive officers and director of the Managing General Partner are set forth
below. There are no family relationships between or among any officers or
directors.

Name Age Position

Patrick J. Foye 41 Executive Vice President and Director

Timothy R. Garrick 42 Vice President _ Accounting and Director

Patrick J. Foye has been Executive Vice President and Director of the Managing
General Partner since October 1, 1998. Mr. Foye has served as Executive Vice
President of AIMCO since May 1998. Prior to joining AIMCO, Mr. Foye was a
partner in the law firm of Skadden, Arps, Slate, Meagher & Flom LLP from 1989 to
1998 and was Managing Partner of the firm's Brussels, Budapest and Moscow
offices from 1992 through 1994. Mr. Foye is also Deputy Chairman of the Long
Island Power Authority and serves as a member of the New York State
Privatization Council. He received a B.A. from Fordham College and a J.D. from
Fordham University Law School.

Timothy R. Garrick has served as Vice President-Accounting of AIMCO and Vice
President-Accounting and Director of the Managing General Partner since October
1, 1998. Prior to that date, Mr. Garrick served as Vice President-Accounting
Services of Insignia Financial Group since June of 1997. From 1992 until June
of 1997, Mr. Garrick served as Vice President of Partnership Accounting and from
1990 to 1992 as an Asset Manager for Insignia Financial Group. From 1984 to
1990, Mr. Garrick served in various capacities with U.S. Shelter Corporation.
From 1979 to 1984, Mr. Garrick worked on the audit staff of Ernst & Whinney.
Mr. Garrick received his B.S. Degree from the University of South Carolina and
is a Certified Public Accountant.

ITEM 10. EXECUTIVE COMPENSATION

No direct form of compensation or remuneration was paid by the Partnership to
any officer or director of Fox Partners. However, certain fees and other
payments have been made to the Partnership's Managing General Partner and its
affiliates, as described in "Item 12. Certain Relationships and Related
Transactions".

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information regarding limited partnership
units of the Registrant owned by each person or entity which is known by the
Registrant to own beneficially or exercise voting or dispositive control over
more than 5% of the Registrant's limited partnership units as of December 31,
1998.

Name of Number
Beneficial Owner Of Units Percentage

Insignia Properties, L.P.
(an affiliate of AIMCO) 21,682.0 29.909%
Madison River Properties, LLC
(an affiliate of AIMCO) 5,259.5 7.013%

Madison River Properties, LLC and Insignia Properties LP are indirectly
ultimately owned by AIMCO. Their business address is 55 Beattie Place,
Greenville, SC 29602.

There are no arrangements known to the Registrant, the operation of which may at
a subsequent date, result in a change in control of the Registrant.

Affiliates of the Managing General Partner, currently hold 26.941.5 Units
representing approximately 35.92% of the total outstanding Units. As a result
of its ownership of approximately 35.92% of the Units, these affiliates could be
in a position to significantly influence all voting decisions with respect to
the Partnership. Under the Partnership Agreement, unitholders holding a majority
of the Units are entitled to take action with respect to a variety of matters.
When voting on matters, these affiliates would in all likelihood vote the Units
it acquired in a manner favorable to the interest of the Managing General
Partner because of its affiliation with the Managing General Partner. However
with respect to 21,513 units, such affiliates are required to vote such Units:
(i) against any increase in compensation payable to the Managing General Partner
or to affiliates; and (ii) on all other matters submitted by it or its
affiliates, in proportion to the votes cast by non-tendering unitholders. Except
for the foregoing, no other limitations are imposed on such affiliates' ability
to influence voting decisions with respect to the Partnership.

On October 1, 1998, Insignia Financial Group, Inc. merged into AIMCO, a real
estate investment trust, whose Class A Common Shares are listed on the New York
Stock Exchange. As a result of such merger, AIMCO and AIMCO Properties, L.P., a
Delaware limited partnership and the operating partnership of AIMCO ("AIMCO OP")
acquired indirect control of the Managing General Partner. AIMCO and its
affiliates currently own 35.922% of the limited partnership interests in the
Partnership. AIMCO is presently considering whether it will engage in an
exchange offer for additional limited partnership interests in the Partnership.
There is a substantial likelihood that, within a short period of time, AIMCO OP
will offer to acquire limited partnership interests in the Partnership for cash
or preferred units or common units of limited partnerships interests in AIMCO
OP. While such an exchange offer is possible, no definite plans exist as to when
or whether to commence such an exchange offer, or as to the terms of any such
exchange offer, and it is possible that none will occur.

A registration statement relating to these securities has been filed with the
Securities and Exchange Commission but has not yet become effective. These
securities may not be sold nor may offers to buy be accepted prior to the time
the registration statement becomes effective. This Form 10-KSB shall not
constitute an offer to sell or the solicitation of an offer to buy nor shall
there be any sale of these securities in any state in which such offer,
solicitation or sale would be unlawful prior to the registration or
qualification under the securities laws of any such state.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

1998 1997

(in thousands)

Property management fees (included in operating

expenses) $ 244 $ 242

Reimbursement for services of affiliates

(included in operating, general and

administrative expenses, and investment

properties) (1) 148 134

For the period from January 1, 1997, to August 31, 1997, the Partnership insured
its properties under a master policy through an agency affiliated with the
Managing General Partner with an insurer unaffiliated with the Managing General
Partner. An affiliate of the Managing General Partner acquired, in the
acquisition of a business, certain financial obligations from an insurance
agency which was later acquired by the agent who placed the master policy. The
agent assumed the financial obligations to the affiliate of the Managing General
Partner who receives payment on these obligations from the agent. The amount of
the Partnership's insurance premiums that accrued to the benefit of the
affiliate of the Managing General Partner by virtue of the agent's obligations
was not significant.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

(a) The Exhibits listed on the accompanying Index to Exhibits are filed as part
of this Annual Report and incorporated in this Annual Report as set forth
in said Index.

(b) Current Report on Form 8-K dated October 1, 1998 and filed on October 16,
1998 disclosing change in control of Registrant from Insignia Financial
Group, Inc. to AIMCO.

Current Report on Form 8-K dated November 10, 1998 and filed on November
16, 1998, disclosing the dismissal of Imowitz Koenig & Co., LLP as the
registrant's Independent accountant.

Current Report on Form 8-K dated and filed on December 9, 1998 on
disclosing the engagement of Ernst & Young, LLP as the registrant's
Independent Accountant.

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

CENTURY PROPERTIES FUND XVIII

By: Fox Partners,
Its General Partner

By: Fox Capital Management Corporation,
Its Managing General Partner

By: /s/Patrick J. Foye
Patrick J. Foye
Executive Vice President

By: /s/Timothy R. Garrick
Timothy R. Garrick
Vice President - Accounting

Date: March 30, 1999

In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the
date indicated.

/s/Patrick J. Foye Date: March 30, 1999
Patrick J. Foye
Executive Vice President and Director

/s/Timothy R. Garrick Date: March 30, 1999
Timothy R. Garrick
Vice President - Accounting
and Director

CENTURY PROPERTIES FUND XVIII
EXHIBIT INDEX

Exhibit Number Description of Exhibit

2.5 Master Indemnity Agreement (5)

3.4 Agreement of Limited Partnership (2)

10.1 Promissory Note between Oak Run, L.L.C., a South Carolina limited
liability company, and Lehman Brothers Holdings Inc. d/b/a Lehman
Capital, a division of Lehman Brothers Holdings Inc., a Delaware
corporation, dated September 1997.

10.2 Deed of Trust and Security Agreement between Oak Run, L.L.C., a South
Carolina limited liability company, David M. Parnell, and Lehman
Brothers Holdings Inc. d/b/a Lehman Capital, a division of Lehman
Brothers Holdings Inc., a Delaware corporation, dated September 1997.

10.3 Multi-Family Note between Century Properties Fund XVIII, L.P., a
California limited partnership, and Newport Mortgage Company, L.P., a
Texas limited partnership, dated August 24, 1998.

16 Letter dated November 11, 1998 from the Registrant's former
Independent Auditor regarding its concurrence with the statements made
by the Registrant in Current Report on Form 8-K dated November 10,
1998

27 Financial Data Schedule

(1) Incorporated by reference to Exhibit 2 to the Registrant's Current
Report on Form 8-K dated August 17, 1995.

(2) Incorporated by reference to Exhibit 2.1 to Form 8-K filed by Insignia
Financial Group, Inc. with the Securities and Exchange Commission on
September 1, 1995.

(3) Incorporated by reference to Exhibit 2.2 to Form 8-K filed by Insignia
Financial Group, Inc. with the Securities and Exchange Commission on
September 1, 1995.

(4) Incorporated by reference to Exhibit 2.4 to Form 8-K filed by Insignia
Financial Group, Inc. with the Securities and Exchange Commission on
September 1, 1995.

(5) Incorporated by reference to Exhibit 2.5 to Form 8-K filed by Insignia
Financial Group, Inc. with the Securities and Exchange Commission on
September 1, 1995.

(6) Incorporated by reference to Exhibit A to the Prospectus of the
Registrant dated November 5, 1982, as revised December 30, 1982, and
after supplemented contained in the Registrant's Agreement on Form S-
11 (Reg. No. 2-78495)

(7) Incorporated by reference to exhibit 10 to the Registrant's Current
Report on Form 8-K dated April 22, 1994.

<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Century
Properties Fund XVIII 1998 Year-End 10-KSB and is qualified in its entirety by
reference to such 10-KSB filing.
</LEGEND>
<CIK> 0000704271
<NAME> CENTURY PROPERTIES FUND XVIII
<MULTIPLIER> 1,000

<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> DEC-31-1998
<CASH> 1,477
<SECURITIES> 0
<RECEIVABLES> 501
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 27,143
<DEPRECIATION> 10,473
<TOTAL-ASSETS> 19,292
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 19,457
0
0
<COMMON> 0
<OTHER-SE> (797)
<TOTAL-LIABILITY-AND-EQUITY> 19,292
<SALES> 0
<TOTAL-REVENUES> 4,893
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 4,451
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,469
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 442
<EPS-PRIMARY> 5.31<F2>
<EPS-DILUTED> 0
<FN>
<F1>Registrant has an unclassified balance sheet.
<F2>Multiplier is 1.
</FN>

</TABLE>