8-K

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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


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



                                    FORM 8-K

                                 CURRENT REPORT


     PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934




Date of Report (Date of earliest event reported):  December 8, 1995


Vanguard Real Estate Fund II, A Sales-Commission-Free Income Properties Fund
- ----------------------------------------------------------------------------
(Exact name of the registrant as specified in its character)



Massachusetts                      0-17656                 23-2482429
- -------------                      -------                 ----------
(State of other jurisdiction       (Commission             (IRS Employer
of incorporation)                  File Number)            Identification No.)



Vanguard Financial Center, Malvern, PA                     19355
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(Address of principal executive offices)                   (Zip Code)



Registrant's telephone number, including area code (610) 669-1000
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                                     INDEX



                                                                    Page No.
                                                                       
Cover Page  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -
Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

ITEM
NO.

Item 1.    Change in Control of Registrant  . . . . . . . . . . . . . . . 2
           -------------------------------                                 
Item 2.    Acquisition or Disposition of Assets . . . . . . . . . . . . . 2
           ------------------------------------                            
Item 3.    Bankruptcy or Receivership . . . . . . . . . . . . . . . . . . 2
           --------------------------                                      
Item 4.    Changes in Registrant's Certifying Accountant  . . . . . . . . 2
           ---------------------------------------------                   
Item 5.    Other Events . . . . . . . . . . . . . . . . . . . . . . . . . 2
           ------------                                                    
Item 6.    Resignation of Registrant's Directors  . . . . . . . . . . . . 2
           -------------------------------------                           
Item 7.    Financial Statements and Exhibits  . . . . . . . . . . . . . . 2
           ---------------------------------                               
Item 8.    Change in Fiscal Year  . . . . . . . . . . . . . . . . . . . . 2
           ---------------------                                           



Signatures  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3



Exhibit Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

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Item 1.   Change in Control of Registrant

          None

Item 2.   Acquisition or Disposition of Assets

          None

Item 3.   Bankruptcy or Receivership

          None

Item 4.   Changes in Registrant's Certifying Accountant

          None

Item 5.   Other Events

          On December 8, 1995, the Fund's Board of Trustees adopted a plan of
liquidation and termination.  This plan is being undertaken in the eighth year
of the Fund's initially contemplated seven-to-twelve-year life.  The decision
to adopt the plan of liquidation at this time was driven by several factors,
including real estate market conditions and tax considerations affecting real
estate investment trusts.  The plan of liquidation contemplates the orderly
sale of, and the distribution of net proceeds received from, the Fund's
remaining real estate investments over the next 24 months.

          At December 8, 1995 the Fund held investments in three
income-producing commercial properties or portfolios (consisting of one office
complex located in San Carlos, California, one shopping center located in
Boulder, Colorado, and one industrial park located in Bucks County,
Pennsylvania) and a limited partnership interest that owns an income-producing
property (located in Mountain View, California).  The Fund's real estate
investments at November 30, 1995 had a recorded book value of approximately
$26.0 million, or $4.05 per share.

          In addition, at its regular meeting on December 6, 1995, the Board of
Trustees declared a $1.25 per share distribution, payable on December 28, 1995,
to shareholders of record as of December 26, 1995.  This distribution will be
made from the Fund's cash reserves, which were approximately $9 million at
November 30, 1995. The capital distribution will reduce the book value of the
Fund's shares and also the amount of future income the Fund may be expected to
generate.

Item 6.   Resignation of Registrant's Directors

          None

Item 7.   Financial Statements and Exhibits

          The Plan of Liquidation and Termination for Vanguard Real Estate Fund
II is attached as an exhibit on pages 5-9 of this Report.

Item 8.   Change in Fiscal Year

          None





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                                   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.


                         Vanguard Real Estate Fund II,
                 A Sales-Commission-Free Income Properties Fund




DATE: January 9, 1995                     BY: /s/ Ralph K. Packard
     -----------------                       ----------------------
                                             Ralph K. Packard
                                             Vice President and Controller





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                                EXHIBIT INDEX






                                                                     Page No.
                                                                 
2.  Plan of Liquidation and Termination - Vanguard Real Estate
      Fund II ........................................................ 5-9






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EX-2

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                          VANGUARD REAL ESTATE FUND II
                 A SALES-COMMISSION-FREE INCOME PROPERTIES FUND

                            SECRETARY'S CERTIFICATE


     The undersigned, Raymond J. Klapinsky, being the duly elected and acting
Secretary of Vanguard Real Estate Fund II, A Sales-Commission-Free Income
properties Fund (the "Fund"), hereby certifies that attached hereto as Exhibit
A is a true and correct copy of a Plan of Liquidation and Termination duly
adopted by Unanimous Consent of the Board of Trustees of the Fund on December
8, 1995.  Such resolutions have not been modified or repealed and remain in
full force and effect as of the date hereof.

     IN WITNESS WHEREOF, I have hereunto set my hand to this Certificate as of
this 21st day of December, 1995.


                    /s/ Raymond J. Klapinsky
                    --------------------------------------------
                    Raymond J. Klapinsky, Secretary

                    Vanguard Real Estate Fund II,
                    A Sales-Commission-Free Income Properties Fund





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                         VANGUARD REAL ESTATE FUND II,
                 A SALES-COMMISSION-FREE INCOME PROPERTIES FUND

                      PLAN OF LIQUIDATION AND TERMINATION

     WHEREAS, Vanguard Real Estate Fund II, A Sales-Commission-Free Income
Properties Fund (the "Fund"), is a business trust organized pursuant to the
laws of the Commonwealth of Massachusetts; and

     WHEREAS, the Fund has operated as a "real estate investment trust" under
Sections 856-859 of the Internal Revenue Code of 1986, as amended the ("Code");
and

     WHEREAS, the Fund was organized in 1987 as a "finite life" real estate
investment trust, with a then-contemplated duration of between seven and twelve
years; and

     WHEREAS, pursuant to Section 8.1 of the Fund's Amended and Restated
Declaration of Trust, dated as of January 8, 1988 (as subsequently amended, the
"Declaration of Trust"), the Trustees of the Fund have the discretion to
determine in good faith whether and when the Fund should be liquidated and
terminated, if and so long as the termination occurs not later than January 8,
2003; and

     WHEREAS, the Trustees have determined in good faith that it is in the best
interest of the Fund and the Shareholders for the Fund to be liquidated and
terminated in accordance with the Plan of Liquidation hereby adopted:

     NOW THEREFORE, BE AND IT HEREBY IS RESOLVED that the Fund be completely
liquidated in accordance with Section 331 of the Code.

     FURTHER RESOLVED, that the Trustees and officers of the Fund be and they
hereby are authorized and directed to complete and carry out the Plan of
Liquidation as hereinafter set forth.

     FURTHER RESOLVED, that, without limiting the generality of the foregoing,
the following Plan of Liquidation be and it hereby is adopted:

     1.   TERMS.  All capitalized terms not otherwise defined herein shall have
the meaning set forth in the Declaration of Trust of the Fund.

     2.   IRS FILING.  Within thirty days of the date of the adoption of this
Plan of Liquidation by the Trustees, an IRS Form 966 shall be properly filed
with the appropriate office of the Internal Revenue Service.

     3.   LIQUIDATION OF ASSETS.  In furtherance of this Plan of Liquidation,
the Fund shall sell, exchange or otherwise dispose of all of its assets to the
extent, for such consideration and upon such terms and conditions as the
Trustees of the Fund deem expedient and in the best interest of the Fund and
its Shareholders.  All assets remaining after the payment of or provision for
the payment or satisfaction of all liabilities or obligations of the Fund
shall, to the extent not already consisting of cash, be converted into cash at
public or private sale.

     4.   PAYMENT OF DEBTS.  Prior to any final distribution to its
Shareholders, the Fund shall promptly pay or provide for the payment or
satisfaction of all debts, expenses, taxes, liabilities (whether





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known, unascertained, contingent or unmatured) and all other obligations of the
Fund, including expenses of dissolution, liquidation and termination of
existence.

     5.   LIQUIDATION DISTRIBUTION.  Following the payment or provision for the
payment or satisfaction of the Fund's liabilities and obligations pursuant to
paragraph 3 above, the Fund shall distribute its remaining cash and assets to
Shareholders of the Fund in such amounts and at such times as shall be
determined by the Trustees in their sole discretion and consistent with the
Fund's Declaration of Trust and its maintaining its status as a "real estate
investment trust" under the Code.  Distributions may be made in installments
from time to time or as a whole.  Upon payment of the liquidation distribution
(or final liquidation distribution, if made in installments), each Shareholder
of the Fund shall be given notice to deliver to the Fund, or to a trust to
which the assets of the Fund may have been transferred, the certificates
representing all of the shares of the Fund owned by such Shareholder.  The cash
of the Fund as determined under paragraphs 4 and 5 above shall be divided among
the Shareholders on a pro rata basis.  If a Shareholder's certificate of shares
of beneficial interest in the Fund has been lost, stolen or destroyed, such
Shareholder may be required to furnish the Fund with satisfactory evidence of
the loss, theft or destruction thereof, together with a reasonable undertaking
or indemnity satisfactory to the Fund, as a condition to the receipt of any
distribution.  The complete liquidation of the Fund shall be completed within
24 months of the date of the adoption of this Plan of Liquidation.

     6.   TERMINATION.  As promptly as practicable after the payment of or
provision for the payment or satisfaction of all liabilities and obligations of
the Fund, and upon the taking of any act required to be taken under the laws of
the Commonwealth of Massachusetts, the Fund shall be terminated in accordance
with the laws of the Commonwealth of Massachusetts.

     7.   CESSATION OF BUSINESS.  After the adoption of this Plan of
Liquidation, the Fund shall not engage in any business activities except for
the purposes of preserving the values of its assets, adjusting and winding up
its business affairs, and making any liquidation distribution in accordance
with the Plan of Liquidation.  The Trustees now in office and, at their
pleasure, the officers of the Fund, shall continue in office solely for these
purposes.  Unless and until the decision to proceed with the Plan of
Liquidation is reversed by the Fund's Trustees, no new business operations will
be explored or undertaken by the Fund.

     8.   POWER OF THE TRUSTEES.  The Trustees and, if authorized by the
Trustees, the officers of the Fund, shall have authority to do or authorize any
and all acts and things as provided for in this Plan of Liquidation and any and
all such further acts and things as they may consider desirable to carry out
the purposes of this Plan of Liquidation, including the execution and filing of
all such certificates, documents, information returns, tax returns, and other
documents which may be necessary or appropriate to implement this Plan of
Liquidation.  The Trustees may authorize such variations from or amendments to
the provisions of this Plan of Liquidation as may be necessary or appropriate
to effectuate the complete liquidation, dissolution and termination of
existence of the Fund, and the distribution of its assets to its Shareholders
in accordance with the laws of the Commonwealth of Massachusetts.  The death,
resignation, or other disability of any Trustees, or officer of the Fund shall
not impair the authority of the surviving or remaining Trustees or officers to
exercise any of the powers provided for in the Plan of Liquidation.  Upon such
death, resignation, or other disability, the surviving or remaining Trustees,
or, if there be none, the surviving or remaining officers, shall have authority
to fill the vacancy or vacancies created, but the failure to fill such vacancy
or vacancies shall not impair the authority of the surviving or remaining
Trustees or officers to exercise any of the powers provided for in this Plan of
Liquidation.

     After the effective date of termination of the Fund, the Trustees shall
continue to act as Trustees and shall have full power to wind up and settle the
Fund's affairs, and the Fund shall cease to carry on





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business except to the extent necessary for the beneficial winding up thereof.
The powers and duties of the Trustees of the Fund shall include, but are not
limited to, the following acts in the name and on behalf of the Fund:  (a) to
elect officers and employ agents and attorneys to liquidate or wind up its
affairs; (b) to continue the conduct of the business of the Fund only insofar
as necessary for the disposal or winding up thereof; (c) to carry out contracts
and collect, pay, compromise and settle debts for or against the Fund; (d) to
defend suits brought against the Fund; (e) to sue in the name of the Fund for
all sums due or owing to the Fund or to recover any of its property; and (f) in
general, to make contracts and to do any and all things in the name of the Fund
which may be proper or convenient for the purposes of winding up, settling and
liquidating the affairs of the Fund.

     9.   LIQUIDATING TRUST.  If advisable for any reason to complete the
liquidation and distribution of the Fund's assets to the Shareholders of the
Fund, and subject to approval of the liquidating trustee by Shareholders of the
Fund if such approval is deemed advisable by the Trustees, the Trustees may at
any time (including after its dissolution) transfer to a liquidating trust any
or all remaining assets of the Fund.  The liquidating trust will succeed to all
of the then-remaining assets of the Fund, including the reserve for contingent
or unsatisfied liabilities and obligations of the Fund and any liabilities and
obligations of the Fund expressly not assumed by any purchaser of the Fund's
assets.  The sole purposes of the liquidating trust will be to prosecute and
defend suits by or against the Fund, to enable the Fund to settle and close the
business of the Fund, to dispose of and convey the assets of the Fund, to
satisfy the remaining liabilities and obligations of the Fund, and to
distribute the remaining cash to the Fund's Shareholders.  The Trustees may
appoint a trustee or trustees to act as trustee or trustees of the liquidating
trust on such terms and conditions as the Trustees determine.  It is intended
that any liquidating trust so established qualify as a "liquidating trust", as
such term is defined in Treasury Regulation 301.7701-4(d).

     In the event it is determined by a majority of the Trustees that an entity
or entities different in form but similar in purpose to a liquidating trust,
such as an escrow or partnership, is more appropriate to the administration and
completion of the liquidation, then the Trustees shall take all steps necessary
to establish such other entity or entities.  Such an entity or entities shall
be administered, to the extent possible, in the same manner as provided with
respect to the liquidating trust contemplated above.

     10.  AMENDMENTS.  The Trustees of the Fund may modify or amend this Plan
of Liquidation and, prior to the final termination of the Trust, may abandon
this Plan of Liquidation without further action to the extent permitted by the
laws of the Commonwealth of Massachusetts.

     11.  INDEMNIFICATION OR INSURANCE.  The obligation of the Fund to
indemnify and reimburse its trustees, officers, employees or affiliates
pursuant to Section 7.4 of the Fund's Declaration of Trust or otherwise shall
survive the liquidation and dissolution of the Fund, but may be satisfied only
out of the assets of any reserve fund or liquidating trust which has assumed
the liability therefor or the proceeds of insurance therefor, but not from
distributions made to shareholders.  The Trustees shall have the power and
authority after the termination of the Fund to purchase, continue and maintain
insurance as may be necessary to cover the Fund's indemnification obligations,
and the Trustees also shall have the power and authority to satisfy any of the
indemnification obligations of the Fund out of the assets of the Fund,
including assets held by an agent or a trust or other entity.

     12.  COSTS.  The Trustees are authorized, empowered and directed to pay
all legal, accounting, printing, appraisal and other fees and expenses of
persons rendering services to the Fund in connection with adoption and/or
implementation of this Plan of Liquidation.





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     13.  AGENT FOR SHAREHOLDERS.  In order to effect a final distribution of
its remaining cash and investments to its Shareholders, the appropriate
officers of the Fund are hereby authorized to appoint an agent for Shareholders
of the Fund, if such action is deemed advisable by the Trustees.  The Fund
shall deliver to such agent for the Shareholders the cash to be distributed to
the Shareholders as determined under paragraph 4 above.  Such liquidation
distribution will be distributable to the Shareholders by the agent for
Shareholders as soon as practicable after receipt of the funds from the Fund to
those Shareholders who have delivered their certificates representing shares of
the Fund or other satisfactory evidence as provided for in paragraph 4 above.
The remainder of such cash will be held for the account of those Shareholders
who have not delivered their share certificates or other satisfactory evidence.
No interest shall accrue at any time on any cash held by the agent for
Shareholders.

     14.  APPROVAL AND EFFECTIVE DATE.  In accordance with the provisions of
Section 8.1 of the Declaration of Trust, this Plan of Liquidation shall be and
become effective upon its approval by a majority of Trustees of the Fund then
in office (including a majority of Unaffiliated Trustees).





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