SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q
ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934


For the Quarter Ended June 30, 1998 Commission File No. 0-15940


UNIPROP MANUFACTURED HOUSING COMMUNITIES INCOME FUND,
A MICHIGAN LIMITED PARTNERSHIP

(Exact name of registrant as specified in its charter)


MICHIGAN
(State or other jurisdiction of
incorporation or organization)
38-2593067
(I.R.S. employer
identification number)


280 DAINES STREET, BIRMINGHAM, MICHIGAN 48009
(Address of principal executive offices) (Zip Code)

(248) 645-9261
(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(g) of the Act:
$1,000 per unit, units of limited partnership interest


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

Yes [X] No [ ]



Uniprop Fund I 10-Q: PART I. FINANCIAL INFORMATION

Item 1: Financial Statements
UNIPROP MANUFACTURED HOUSING COMMUNITIES INCOME FUND, A MICHIGAN LIMITED PARTNERSHIP

Balance Sheets



ASSETS                                        JUNE 30, 1998  DECEMBER 31, 1997
                                              -------------  ----------------- 
                                               (UNAUDITED)
        
Properties:
  Land                                           $  5,280,000    $  5,280,000
  Buildings And Improvements                       23,893,423      23,862,182
  Manufactured Homes                                  727,420         668,108
  Furniture And Fixtures                              120,945         117,847
                                                 ------------    ------------
                                                   30,021,788      29,928,137

  Less Accumulated Depreciation                     9,219,095       8,805,795
                                                 ------------    ------------
                                                   20,802,693      21,122,342

Cash And Cash Equivalents                             788,177         649,137
Unamortized Finance Costs                             753,548         796,547
Other Assets                                          682,862         484,407
                                                 ------------    ------------
Total Assets                                     $ 23,027,280    $ 23,052,433
                                                 ------------    ------------

LIABILITIES                                  JUNE 30, 1998   DECEMBER 31, 1997
                                             -------------   -----------------
                                              (UNAUDITED)

Line of Credit                                   $    469,523    $    358,916
Accounts Payable                                       72,164         116,066
Mortgage Payable                                   33,234,751      33,355,940
Other Liabilities                                   1,119,397         891,073
                                                 ------------    ------------

Total Liablities                                 $ 34,895,835    $ 34,721,995

Partners' Equity:
  General Partner                                 (1,380,352)     (1,261,905)
  Class A Limited Partners                        (9,590,482)     (9,509,936)
  Class B Limited Partners                          (897,721)       (897,721)

Total Partners' Equity                           (11,868,555)    (11,669,562)
                                                 ------------    ------------

Total Liabilities And
  Partners' Equity                               $ 23,027,280    $ 23,052,433
                                                 ------------    ------------



UNIPROP MANUFACTURED HOUSING COMMUNITIES INCOME FUND, A MICHIGAN LIMITED PARTNERSHIP



STATEMENTS OF INCOME SIX MONTHS ENDED THREE MONTHS ENDED (UNAUDITED) JUNE 30, 1998 JUNE 30, 1997 JUNE 30, 1998 JUNE 30, 1997 ------------- ------------- ------------- ------------- Income: Rental Income $3,988,69 $3,895,925 $1,996,805 $1,958,640 Other 189,037 199,682 99,057 129,013 -------- ---------- ---------- ---------- Total Income $4,177,729 $4,095,607 $2,095,862 $2,087,653 ---------- ---------- ---------- ---------- Operating Expenses: Administrative Expenses (Including $207,999, $201,509, $104,623, And $101,545 In Property Management Fees Paid To An Affliate For The Six and Three Month Periods Ended June 30, 1998 and 1997 Respectively) 913,938 845,826 434,550 413,673 Property Taxes 414,780 415,866 207,375 204,721 Utilities 236,488 236,958 124,132 125,753 Property Operations 529,856 462,348 270,223 255,978 Dep And Amortization 456,300 413,898 227,800 217,712 Interest 1,402,860 758,797 700,360 758,797 ---------- ---------- ---------- ---------- Total Operating Expenses $3,954,222 $3,133,693 $1,964,440 $1,976,634 ---------- ---------- ---------- ---------- Net Income $ 223,507 $ 961,914 $ 131,422 $ 111,019 ---------- ---------- ---------- ---------- Income Per Limited Partnership Unit: Class A $ 0.02 $ 28.00 $ 0.02 $ 10.00 Class B $ 4.00 $ 48.28 $ 2.00 $ 23.00 Distribution Per Limited Partnership Unit Class A $ 4.00 $ 48.00 $ 2.00 $ 23.00 Class B $ 4.00 $ 48.00 $ 2.00 $ 23.00 Weighted Average Number Of Limited Partnership Units Outstanding Class A 20,230 20,230 20,230 20,230 Class B 9,770 9,770


UNIPROP MANUFACTURED HOUSING COMMUNITIES INCOME FUND A MICHIGAN LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
      (UNAUDITED)       
                                                      SIX MONTHS ENDED
                                                JUNE 30, 1998   JUNE 30, 1997
                                                -------------   -------------
        
Cash Flows From Operating Activities:
  Net Income (Loss)                                 $ 223,507      $  961,914

Adjustments To Reconcile Net Income
  (Loss) To Net Cash Provided By
  Operating Activities:
  Depreciation                                        413,300         392,372
  Amortization                                         43,000          21,526
(Increase) Decrease In Other Assets From Operations  (198,456)    (1,235,424)
  Increase  (Decrease) In Accounts Payables           (43,902)        (3,313)
  Increase (Decrease) Other Liabilities From Oper.    228,324          77,541
                                                     ---------   ------------

Total Adjustments                                     442,266       (747,298)
                                                     ---------   ------------
    Net Cash Provided By (Used In)
      Operating Activities                            665,773         214,616
                                                     ---------   ------------

Cash Flows From Investing Activities:
  Capital Expenditures                                (93,651)    (1,610,218)
   Funds From Line of Credit                          110,607         104,700
                                                     ---------   ------------

    Net Cash Provided By (Used In)
      Investing Activities                             16,956     (1,505,518)
                                                     ---------   ------------

Cash Flows From Financing Activities:
   Funds from Mortgage                                      0      33,500,000
  Distributions To Partners                          (422,500)    (2,053,400)
  Return of Capital                                         0    (30,000,000)
  Principal Payments on Mortgage                     (121,189)       (35,295)
                                                     ---------   ------------

Net Cash Provided By (Used In)
  Financing Activities                               (543,689)      1,411,305
                                                     ---------   ------------

Increase (Decrease) In Cash                           139,040         120,403
Cash, Beginning                                       649,137         640,086
                                                     ---------   ------------

Cash, Ending                                        $ 788,177      $  760,489
                                                     ---------   ------------

UNIPROP MANUFACTURED HOUSING COMMUNITIES INCOME FUND,
A MICHIGAN LIMITED PARTNERSHIP

Notes to Financial Statements

June 30, 1998 (Unaudited)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Presentation:

The balance sheet as of June 30, 1998, the related statements of income and statements of cash flow for the periods ended June 30, 1998 and 1997 have been prepared by management, pursuant to the rules and regulations of the Securities and Exchange Commission, without audit by independent public accountants. In the opinion of management, all adjustments (consisting of only normal recurring accruals) necessary for a fair presentation of such financial statements have been included.

The financial statements and notes are presented as permitted by the rules and regulations of the Securities and Exchange Commission for Form 10-Q and do not contain certain information included in the Company's annual financial statements and notes, which should be consulted.

2. PAYMENTS TO AFFILIATES:

                         SIX  MONTHS ENDED            THREE MONTHS ENDED
                   JUNE 30, 1998 JUNE 30, 1997   JUNE 30, 1998 JUNE 30, 1997
                   ------------- -------------   ------------- -------------

PROPERTY MANAGEMENT FEE
TO UNIPROP, INC.:       $207,999      $201,509        $104,623      $101,545

ITEM 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Capital Resources

The Partnership's capital resources consist primarily of its four manufactured housing communities. On March 25, 1997 the Partnership borrowed $33,500,000 from Nomura Asset Capital Corporation (the "Financing"). It secured the Financing by placing liens on its four communities. As a result of the Financing, the Partnership distributed $30,000,000 to the Limited Partners, which represented a full return of the original capital contributions of $1,000 per unit.

Liquidity

As a result of the Financing, the Partnership's four properties are mortgaged. At the time of the Financing, the aggregate principal amounts due under the four mortgage notes was $33,500,000 and the aggregate fair market value of the Partnership's mortgaged properties was $53,200,000. The Partnership expects to meet its short-term liquidity needs generally through its working capital provided by operating activities.

The Partnership's long-term liquidity is based, in part, upon its investment strategy. The properties owned by the Partnership were anticipated to be held for seven to ten years after their acquisition, although it was expected that they could be disposed of earlier or later. All of the properties have been owned by the Partnership at least ten years. The General Partner may elect to have the Partnership own the properties for as long as, in the opinion of the General Partner, it is in the best interest of the Partnership to do so.

The Partnership has a renewable $600,000 line of credit with First of America Bank. The interest rate on such line of credit, floats 180 basis points above 1 month LIBOR, which on June 30, 1998 was 5.66%. The sole purpose of the line of credit is to purchase new and used homes to be used as model homes and offered for sale within the Partnership's communities. Over the past two years, sales of the new and used model homes have been growing and the General Partner believes that continuing the model home program is in the best interest of the Partnership. As of June 30, 1998, the oustanding balance on the line of credit was $469,523.

Net Cash from Operations available for aggregate distributions to all Partners in UMHCIF during the quarter ended June 30, 1998 amounted to $359,222. The amount available during the same period in 1997 was $328,731. Management considers Net Cash from Operations to be a supplemental measure of the Partnership's operating performance. Net Cash from Operations is defined to mean net income computed in accordance with generally accepted accounting principles ("GAAP"), plus real estate related depreciation and amortization. Net Cash from Operations does not represent cash generated from operating activities in accordance with GAAP and is not necessarily indicative of cash available to fund cash needs. Net Cash from Operations should not be considered as an alternative to net income as the primary indicator of the Partnership's operating performance or as an alternative to cash flow as a measure of liquidity.

The quarterly Partnership Management Distribution due and paid to the General Partner for the second quarter was $139,500, or one-fourth of 1.0% of the most recent appraised value of the properties held by the Partnership. ($55,800,000 x .01 = $558,000 / 4 = $139,500)

The cash available after payment of the Partnership Management Distribution of $139,500 from Net Cash from Operations was $219,722. From this amount, the General Partner elected to make a total distribution of $75,000 for the second quarter of 1998, 80.0% or $60,000 was paid to the Limited Partners and 20.0% or $15,000 was paid to the General Partner. The General Partner will continue to monitor on-going Net Cash from Operations generated by the Partnership during the coming quarters. If Net Cash from Operations generated is lower or higher than the amount needed to maintain the current distribution level, the General Partner may elect to reduce or increase the level of future distributions paid to the Limited Partners.

While the Partnership is not required to maintain a working capital reserve, the Partnership has not distributed all the cash generated from operations in order to build cash reserves. As of June 30, 1998, the Partnership cash reserves amounted to $788,177. The level of cash reserves maintained is at the discretion of the General Partner.

Results of Operations

OVERALL, as illustrated in the tables below, the four properties enjoyed a combined average occupancy of 97.9% (1,786/1,824 sites) at the end of June 1998, versus 97.3% a year ago. The average monthly rent in June 1998 was approximately $395, or 3.1% more than the $383 average monthly rent in June 1997.


                          Total      Occupied     Occupancy    Average
                        Capacity       Sites         Rate        Rent


Aztec Estates              645          625          96.9%     $  441
Kings Manor                314          305          97.1         422
Old Dutch Farms            293          284          96.9         391
Park of the Four Seasons   572          572         100.0         338
                           ---          ---         -----      ------

Total on 6/30/98:        1,824        1,786          97.9%     $  395
Total on 6/30/97:        1,824        1,774          97.3%     $  383

                             GROSS REVENUES         NET OPERATING
                                                        INCOME
                           6/30/98     6/30/97  6/30/98        6/30/97

        
Aztec Estates          $   779,187  $   811,037 $   404,992  $   398,759
Kings Manor                370,797      356,768     228,017      232,116
Old Dutch Farms            346,621      328,828     230,513      223,535
Park of the Four Seasons   589,511      568,801     353,818      345,975
                       -----------  ----------- -----------  -----------
                         2,086,116  $ 2,065,434   1,217,341  $ 1,200,385

Partnership Management:      9,746       22,219     (59,657)     (64,961)

Other Non Recurring expenses:-----         ----     (98,101)     (47,896)

Debt Service                                       (700,360)    (758,797)

Depreciation and Amortization-----         ----    (227,800)    (217,712)
                       -----------  -----------  -----------  -----------

                       $ 2,095,862  $ 2,087,653  $   131,422  $   111,019

COMPARISON OF QUARTER ENDED JUNE 30, 1998 TO QUARTER ENDED JUNE 30, 1997

Gross revenues increased $8,209, to $2,095,862 in 1998, as compared to $2,087,653 in 1997. The increase in gross revenues is the result of higher overall occupancy and higher average rents at the Partnership's four communities (see table on previous page).

Administrative expenses increased $20,877, or 5.0% to $434,550 in 1998, as compared to $413,573 in 1997. The increase is the result of higher wages. Partnership management costs decreased $5,304, or 8.2%, to $59,657 in 1998, as compared to $64,961 in 1997. Property operation costs increased $14,245, or 5.6%, to $270,223 in 1998, as compared to $255,978 in 1997. The increase was the result of higher maintenance and marketing expense. Interest expense associated with the Partnership's mortgage debt decreased by $58,437, or 7.7%, to $700,360 in 1998, as compared to $758,797. The decrease is the result of the prepayment of interest in 1997.

As a result of the foregoing factors, net income increased to $131,422 for the quarter ended June 30, 1998 from $111,019 for the quarter ended June 30, 1997.

MANAGEMENT EXPENSES

Net Partnership management expenses paid during the quarter amounted to $59,657. Gross expenses of $69,403 (data processing, accounting and legal expenses, office supplies and wages to employees of the Partnership) were partially offset by income of $9,746 generated by interest on the Partnership's reserves and transfer fees. The figures for last year's second quarter were $64,961, $87,180 and $22,219, respectively.

PART II - OTHER INFORMATION

ITEM 6. EXHIBITS AND REPORTS OF FORM 8-K

(a) Exhibits

                           Exhibit Number                Description
                           --------------                -----------
                                27                 Financial Data Schedule

                           (b) Reports of Form 8-K
                               There were no reports filed on Form 8-K
                               during the three months ended June 30, 1998.

                                   SIGNATURES

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


                                             Uniprop Manufactured Housing
                                             Communities Income Fund,
                                             A Michigan Limited Partnership

                                    BY:      P.I. Associates Limited 
                                             Partnership, A Michigan Limited 
                                             Partnership, its General Partner

                                    BY:      /s/ Paul M. Zlotoff
                                             ----------------------------
                                             Paul M. Zlotoff, General Partner

                                    BY:      /s/ Gloria A. Koster
                                             ----------------------------
                                             Gloria A. Koster, Principal 
                                             Financial Officer



Dated: August 14, 1998