UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

Form 10-QSB

(Mark One)

[X]

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

For the quarterly period ended September 30, 2006

[ ]

TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from _________to _________

Commission file number 0-17646

UNITED INVESTORS INCOME PROPERTIES

(Exact name of small business issuer as specified in its charter)

   Missouri

43-1483942

(State or other jurisdiction of

   (I.R.S. Employer

 incorporation or organization)

  Identification No.)

55 Beattie Place, PO Box 1089

Greenville, South Carolina  29602

(Address of principal executive offices)

(864) 239-1000

(Issuer's telephone number)

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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 ___

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

PART I – FINANCIAL INFORMATION

ITEM 1.

FINANCIAL STATEMENTS

UNITED INVESTORS INCOME PROPERTIES

BALANCE SHEET

(Unaudited)

(in thousands, except unit data)

September 30, 2006

Assets
Cash and cash equivalents		$   105
Receivables and deposits		74
Other assets		83
Investment properties:
Land	$ 1,021
Buildings and related personal property	6,952
	7,973
Less accumulated depreciation	(3,981)	3,992
		$ 4,254
Liabilities and Partners' (Deficiency) Capital
Liabilities
Accounts payable		$    24
Tenant security deposit liabilities		25
Accrued property taxes		16
Other liabilities		39
Due to affiliates (Note B)		67
Mortgage note payable		1,886
Partners' (Deficiency) Capital
General partner	$   (41)
Limited partners (61,063 units issued and
outstanding)	2,238	2,197
		$ 4,254

See Accompanying Notes to Financial Statements

UNITED INVESTORS INCOME PROPERTIES

STATEMENTS OF OPERATIONS

(Unaudited)

(in thousands, except per unit data)

	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2006	2005	2006	2005
Revenues:
Rental income	$   278	$   246	$   800	$   752
Other income	28	30	83	82
Casualty gain (Note D)	20	--	20	--
Total revenues	326	276	903	834
Expenses:
Operating	176	169	533	434
General and administrative	25	39	81	86
Depreciation	72	67	213	196
Interest	45	--	121	--
Property taxes	23	15	68	67
Total expenses	341	290	1,016	783
(Loss) income from continuing
operations	(15)	(14)	(113)	51
Income from discontinued
operations (Notes A and C)	--	12	--	130
Gain from sale of discontinued
operations (Note C)	--	2,666	--	2,666
Net (loss) income	$   (15)	$ 2,664	$  (113)	$ 2,847
Net (loss) income allocated
to general partner	$    --	$    93	$    (1)	$    95
Net (loss) income allocated
to limited partners	(15)	2,571	(112)	2,752
	$   (15)	$ 2,664	$  (113)	$ 2,847
Per limited partnership unit:
(Loss) income from continuing
operations	$ (0.25)	$ (0.23)	$ (1.83)	$  0.82
Income from discontinued
operations	--	0.20	--	2.11
Gain from sale of discontinued
operations	--	42.14	--	42.14
Net (loss) income	$ (0.25)	$ 42.11	$ (1.83)	$ 45.07
Distributions per limited
partnership unit	$    --	$ 78.51	$  1.79	$84.67

See Accompanying Notes to Financial Statements

UNITED INVESTORS INCOME PROPERTIES

STATEMENT OF CHANGES IN PARTNERS' (DEFICIENCY) CAPITAL

(Unaudited)

(in thousands, except unit data)

	Limited
	Partnership	General	Limited
	Units	Partner	Partners	Total
Original capital contributions	61,063	$    --	$15,266	$15,266
Partners' (deficiency) capital
at December 31, 2005	61,063	$   (39)	$ 2,459	$ 2,420
Distribution to partners	--	(1)	(109)	(110)
Net loss for the nine months
ended September 30, 2006	--	(1)	(112)	(113)
Partners' (deficiency) capital
at September 30, 2006	61,063	$   (41)	$ 2,238	$ 2,197

See Accompanying Notes to Financial Statements

UNITED INVESTORS INCOME PROPERTIES

STATEMENTS OF CASH FLOWS

(Unaudited)

(in thousands)

	Nine Months Ended
	September 30,
	2006	2005
Cash flows from operating activities:
Net (loss) income	$  (113)	$ 2,847
Adjustments to reconcile net (loss) income to net cash
provided by operating activities:
Depreciation	213	242
Amortization of loan costs	32	--
Casualty gain	(20)	--
Gain from sale of discontinued operations	--	(2,666)
Change in accounts:
Receivables and deposits	(8)	(4)
Other assets	2	(16)
Accounts payable	(6)	(26)
Tenant security deposit liabilities	7	4
Accrued property taxes	16	16
Other liabilities	(8)	1
Due to affiliates	13	(5)
Net cash provided by operating activities	128	393
Cash flows from investing activities:
Insurance proceeds received	36	--
Property improvements and replacements	(221)	(227)
Net proceeds from sale of discontinued operations	--	4,941
Net cash (used in) provided by investing activities	(185)	4,714
Cash flows from financing activities:
Payments on mortgage note payable	(21)	--
Advances from affiliate	54	--
Distributions to partners	(110)	(5,222)
Loan costs refunded (paid)	10	(31)
Net cash used in financing activities	(67)	(5,253)
Net decrease in cash and cash equivalents	(124)	(146)
Cash and cash equivalents at beginning of period	229	356
Cash and cash equivalents at end of period	$   105	$   210
Supplemental disclosure of cash flow information:
Cash paid for interest	$    89	$    --
Supplemental disclosure of non-cash activity:
Property improvements and replacements included in
accounts payable	$     9	$    11

Included in property improvements and replacements for the nine months ended September 30, 2006 are approximately $13,000 of improvements which were included in accounts payable at December 31, 2005.

See Accompanying Notes to Financial Statements

UNITED INVESTORS INCOME PROPERTIES

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

Note A – Basis of Presentation

The accompanying unaudited financial statements of United Investors Income Properties (the "Partnership" or "Registrant") have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB and Item 310(b) of Regulation S-B.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of United Investors Real Estate, Inc. (the “General Partner” or “UIRE”), a Delaware corporation and a subsidiary of Apartment Investment and Management Company (“AIMCO”), a publicly traded real estate investment trust, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included.  Operating results for the three and nine month periods ended September 30, 2006 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2006. For further information, refer to the financial statements and footnotes thereto included in the Partnership's Annual Report on Form 10-KSB for the fiscal year ended December 31, 2005.

In accordance with Statement of Financial Accounting Standards (“SFAS”) No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets,” the accompanying statements of operations for the three and nine months ended September 30, 2005 reflect the operations of Meadow Wood Apartments, which sold July 22, 2005, as income from discontinued operations. Included in income from discontinued operations are revenues of approximately $42,000 and $372,000 for the three and nine months ended September 30, 2005, respectively.

Certain reclassifications have been made to the 2005 balances to conform to the 2006 presentation.

Note B - Transactions with Affiliated Parties

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

Affiliates of the General Partner receive 5% of gross receipts from all of the Partnership's properties as compensation for providing property management services. The Partnership paid to such affiliates approximately $43,000 and $58,000 for the nine months ended September 30, 2006 and 2005, respectively, which are included in operating expenses and income from discontinued operations.

An affiliate of the General Partner charged the Partnership for reimbursement of accountable administrative expenses amounting to approximately $29,000 and $63,000 for the nine months ended September 30, 2006 and 2005, respectively, which is included in general and administrative expenses. At September 30, 2006, approximately $12,000 of these accountable administrative expenses remain unpaid and are included in due to affiliates.

In accordance with the Partnership Agreement, during the nine months ended September 30, 2006, an affiliate of the General Partner advanced approximately $54,000 to the Partnership to fund operating expenses at both of the Partnership’s investment properties. Interest is charged at the prime rate plus 2% (10.25% at September 30, 2006). Interest expense was approximately $1,000 for the nine months ended September 30, 2006. At September 30, 2006, the total amount of advances and accrued interest due to an affiliate of the General Partner was approximately $55,000 and is included in due to affiliates. There were no such advances made by an affiliate of the General Partner to the Partnership during the nine months ended September 30, 2005. Subsequent to September 30, 2006, an affiliate of the General Partner advanced approximately $10,000 to fund operating expenses at Defoors Crossing Apartments.

For acting as real estate broker in connection with the 1999 sale of Peachtree Corners Medical Building, the General Partner earned a real estate commission of approximately $21,000. However, this amount is not payable until the limited partners receive an amount equal to their adjusted capital investment and a cumulative distribution equal to an 8% annual return from the last additional closing date or, if greater, a 6% cumulative annual return from their date of admission to the Partnership. At September 30, 2005, the limited partners had not received their return.  During the nine months ended September 30, 2005, the General Partner determined that the limited partners would not receive both their adjusted capital investment and applicable return with future property sales or financings.  Therefore, the General Partner reversed the real estate commission previously accrued associated with the 1999 sale of Peachtree Corners Medical Buil ding.

The Partnership insures its properties up to certain limits through coverage provided by AIMCO, which is generally self-insured for a portion of losses and liabilities related to workers compensation, property casualty, general liability and vehicle liability. The Partnership insures its properties above the AIMCO limits through insurance policies obtained by AIMCO from insurers unaffiliated with the General Partner. During each of the nine months ended September 30, 2006 and 2005, the Partnership was charged by AIMCO and its affiliates approximately $25,000 for insurance coverage and fees associated with policy claims administration.  

Note C – Disposition of Investment Property

On July 22, 2005, the Partnership sold Meadow Wood Apartments to a third party for a gross sales price of $5,075,000.  The net proceeds realized by the Partnership were approximately $4,941,000 after payment of closing costs of approximately $134,000. The Partnership recognized a gain of approximately $2,666,000 during the three and nine months ended September 30, 2005 as a result of the sale and this amount is included in gain from sale of discontinued operations.  The property’s operations included income of approximately $12,000 and $130,000 for the three and nine months ended September 30, 2005, respectively. Included in the income from discontinued operations for the three and nine months ended September 30, 2005 are revenues of approximately $42,000 and $372,000, respectively.

Note D – Casualty Event

In March 2006, there was a fire at Bronson Place Apartments, causing damage to one unit. Insurance proceeds of approximately $36,000 were received during the nine months ended September 30, 2006 to cover the damages. The Partnership recognized a casualty gain of approximately $20,000 during the three and nine months ended September 30, 2006 as a result of the receipt of insurance proceeds offset by the write-off of the undepreciated damaged assets of approximately $16,000.

Note E - Contingencies

AIMCO Properties L.P. and NHP Management Company, both affiliates of the General Partner, are defendants in a lawsuit alleging that they willfully violated the Fair Labor Standards Act (“FLSA”) by failing to pay maintenance workers overtime for all hours worked in excess of forty per week. The complaint, filed in the United States District Court for the District of Columbia, attempts to bring a collective action under the FLSA and seeks to certify state subclasses in California, Maryland, and the District of Columbia. Specifically, the plaintiffs contend that AIMCO Properties L.P. and NHP Management Company failed to compensate maintenance workers for time that they were required to be "on-call." Additionally, the complaint alleges AIMCO Properties L.P. and NHP Management Company failed to comply with the FLSA in compensating maintenance workers for time that they worked in excess of 40 hours in a week. & nbsp; In June 2005 the court conditionally certified the collective action on both the on-call and overtime issues.  Approximately 1,049 individuals opted in to the class. The defendants moved to decertify the collective action on both issues and the plaintiffs have responded.  Because the court denied plaintiffs’ motion to certify state subclasses, in September 2005, the plaintiffs filed a class action with the same allegations in the Superior Court of California (Contra Costa County), and in November 2005 in Montgomery County Maryland Circuit Court.  The California and Maryland cases have been stayed pending the outcome of the decertification motion in the District of Columbia case.  Although the outcome of any litigation is uncertain, AIMCO Properties, L.P. does not believe that the ultimate outcome will have a material adverse effect on its consolidated financial condition or results of operations. Similarly, the General Partner does not believe that the ultimate outcome wil l have a material adverse effect on the Partnership’s financial condition or results of operations.

The Partnership is unaware of any other pending or outstanding litigation matters involving it or its investment properties that are not of a routine nature arising in the ordinary course of business.

Environmental

Various Federal, state and local laws subject property owners or operators to liability for management, and the costs of removal or remediation, of certain hazardous substances present on a property. Such laws often impose liability without regard to whether the owner or operator knew of, or was responsible for, the release or presence of the hazardous substances. The presence of, or the failure to manage or remedy properly, hazardous substances may adversely affect occupancy at affected apartment communities and the ability to sell or finance affected properties. In addition to the costs associated with investigation and remediation actions brought by government agencies, and potential fines or penalties imposed by such agencies in connection therewith, the presence of hazardous substances on a property could result in claims by private plaintiffs for personal injury, disease, disability or other infirmities. Various laws also impose liability for the cost of removal, remediation or disposal of hazardous substances through a licensed disposal or treatment facility. Anyone who arranges for the disposal or treatment of hazardous substances is potentially liable under such laws. These laws often impose liability whether or not the person arranging for the disposal ever owned or operated the disposal facility. In connection with the ownership, operation and management of its properties, the Partnership could potentially be liable for environmental liabilities or costs associated with its properties.  

Mold

The Partnership is aware of lawsuits against owners and managers of multifamily properties asserting claims of personal injury and property damage caused by the presence of mold, some of which have resulted in substantial monetary judgments or settlements.  The Partnership has only limited insurance coverage for property damage loss claims arising from the presence of mold and for personal injury claims related to mold exposure.  Affiliates of the General Partner have implemented a national policy and procedures to prevent or eliminate mold from its properties and

the General Partner believes that these measures will minimize the effects that mold could have on residents.  To date, the Partnership has not incurred any material costs or liabilities relating to claims of mold exposure or to abate mold conditions.  Because the law regarding mold is unsettled and subject to change the General Partner can make no assurance that liabilities resulting from the presence of or exposure to mold will not have a material adverse effect on the Partnership’s financial condition or results of operations.

ITEM 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

The matters discussed in this report contain certain forward-looking statements, including, without limitation, statements regarding future financial performance and the effect of government regulations. Actual results may differ materially from those described in the forward-looking statements and will be affected by a variety of risks and factors including, without limitation: national and local economic conditions; the terms of governmental regulations that affect the Registrant and interpretations of those regulations; the competitive environment in which the Registrant operates; financing risks, including the risk that cash flows from operations may be insufficient to meet required payments of principal and interest; real estate risks, including variations of real estate values and the general economic climate in local markets and competition for tenants in such markets; litigation, including costs associated with prosecuting and defending cla ims and any adverse outcomes, and possible environmental liabilities. Readers should carefully review the Registrant’s financial statements and the notes thereto, as well as the risk factors described in the documents the Registrant files from time to time with the Securities and Exchange Commission.

The Partnership's investment properties consist of two apartment complexes. The following table sets forth the average occupancy of the properties for each of the nine months ended September 30, 2006 and 2005:

	Average Occupancy
Property	2006	2005
Bronson Place Apartments (1)	94%	89%
Mountlake Terrace, Washington
Defoors Crossing Apartments (2)	90%	95%
Atlanta, Georgia

(1)

The General Partner attributes the increase in average occupancy at Bronson Place Apartments to improved economic conditions in the Seattle area and a more stable tenant base.

(2)

The General Partner attributes the decrease in average occupancy at Defoors Crossing Apartments to increased competition in the Atlanta area.

The Partnership’s financial results depend upon a number of factors including the ability to attract and maintain tenants at the investment properties, interest rates on mortgage loans, costs incurred to operate the investment properties, general economic conditions and weather. As part of the ongoing business plan of the Partnership, the 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 expenses. As part of this plan, the 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, the General Partner may use rental concessions and rental rate reductions to offset softening market conditions; accordingly, there is no guarantee that the General Part ner will be able to sustain such a plan. Further, a number of factors which are outside the control of the Partnership such as the local economic climate and weather can adversely or positively affect the Partnership’s financial results.

Results of Operations

The Partnership recognized net losses of approximately $15,000 and $113,000 for the three and nine months ended September 30, 2006, respectively, compared to net income of approximately $2,664,000 and $2,847,000 for the three and nine months ended September 30, 2005, respectively. In accordance with Statement of Financial Accounting Standards (“SFAS”) No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets”, the accompanying statements of operations for the three and nine

months ended September 30, 2005 reflect the operations of Meadow Wood Apartments as income from discontinued operations due to the sale of the property. On July 22, 2005, the Partnership sold Meadow Wood Apartments to a third party for a gross sales price of $5,075,000.  The net proceeds realized by the Partnership were approximately $4,941,000 after payment of closing costs of approximately $134,000. The Partnership recognized a gain of approximately $2,666,000 during the three and nine months ended September 30, 2005 as a result of the sale and this amount is included in gain from sale of discontinued operations.  The property’s operations included income of approximately $12,000 and $130,000 for the three and nine months ended September 30, 2005, respectively. Included in the income from discontinued operations for the three and nine months ended September 30, 2005 are revenues of approximately $42,000 and $372,000, respectively.< /P>

The Partnership’s loss from continuing operations for the three and nine months ended September 30, 2006 was approximately $15,000 and $113,000, respectively, compared to loss from continuing operations of approximately $14,000 and income from continuing operations of approximately $51,000, respectively, for the three and nine months ended September 30, 2005. Loss from continuing operations remained relatively constant for the three months ended September 30, 2006, as an increase in total revenues was offset by an increase in total expenses. The increase in loss from continuing operations for the nine months ended September 30, 2006 is due to an increase in total expenses, partially offset by an increase in total revenues.

Total revenues increased for both the three and nine months ended September 30, 2006 due to increases in rental income and the recognition of a casualty gain.  Rental income increased for both periods primarily due to increases in occupancy at Bronson Place Apartments and the average rental rate at both of the Partnership’s investment properties and a decrease in bad debt expense, partially offset by a decrease in occupancy at Defoors Crossing Apartments. Other income remained relatively constant for the comparable periods.

In March 2006, there was a fire at Bronson Place Apartments, causing damage to one unit. Insurance proceeds of approximately $36,000 were received during the nine months ended September 30, 2006 to cover the damages. The Partnership recognized a casualty gain of approximately $20,000 during the three and nine months ended September 30, 2006 as a result of the receipt of insurance proceeds offset by the write-off of the undepreciated damaged assets of approximately $16,000.

The increase in total expenses for both the three and nine months ended September 30, 2006 is due to increases in operating, depreciation, and interest expenses, partially offset by a decrease in general and administrative expenses. The increase in total expenses for the three months ended September 30, 2006 is also due to an increase in property tax expense, which remained relatively constant for the nine months ended September 30, 2006. Operating expense increased for both periods primarily due to increases in salaries and related benefits at both of the Partnership’s investment properties and contract services at Bronson Place Apartments, partially offset by a decrease in advertising expense at both of the Partnership’s investment properties.  Depreciation expense increased for both periods due to property improvements and replacements placed into service during the past twelve months at both properties. Interest expense increased for both periods due to the financing obtained on Bronson Place Apartments in October 2005. Property tax expense increased for the three months ended September 30, 2006 primarily due to an adjustment recorded during the three months ended September 30, 2005 as a result of a decrease in the assessed value of Defoors Crossing Apartments.

The decrease in general and administrative expenses for both the three and nine months ended September 30, 2006 was primarily due to a decrease in accountable reimbursements charged by an affiliate of the General Partner as allowed under the Partnership Agreement. The decrease in general and administrative expenses for the nine months ended September 30, 2006 was partially offset by the write off of a commission owed to the General Partner previously accrued in association with the 1999 sale of the Peachtree Corners Medical Building. During the nine months ended September 30, 2005, the General Partner determined that the limited partners will not receive their adjusted capital investment and applicable return with future

sales or financings and accordingly reversed the previous accrual of approximately $21,000. Also included in general and administrative expenses for the three and nine months ended September 30, 2006 and 2005 are costs associated with the quarterly and annual communications with investors and regulatory agencies and the annual audit required by the Partnership Agreement.

Liquidity and Capital Resources

At September 30, 2006, the Partnership had cash and cash equivalents of approximately $105,000, compared to approximately $210,000 at September 30, 2005. Cash and cash equivalents decreased by approximately $124,000, from December 31, 2005, due to approximately $185,000 and $67,000 of cash used in investing and financing activities, respectively, partially offset by approximately $128,000 of cash provided by operating activities. Cash used in investing activities consisted of property improvements and replacements, partially offset by the receipt of insurance proceeds.  Cash used in financing activities consisted of distributions to partners and principal payments made on the mortgage encumbering Bronson Place Apartments, partially offset by advances received from an affiliate of the General Partner and a refund of loan costs previously paid related to the financing obtained on Bronson Place Apartments during October 2005. The Partnership inve sts its working capital reserves in interest bearing accounts.

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 Partnership and to comply with Federal, state and local legal and regulatory requirements. The General Partner monitors developments in the area of legal and regulatory compliance.  For example, the Sarbanes-Oxley Act of 2002 mandates or suggests additional compliance measures with regard to governance, disclosure, audit and other areas. In light of these changes, the Partnership expects that it will incur higher expenses related to compliance. Capital improvements planned for each of the Partnership's properties are detailed below.

Bronson Place Apartments

During the nine months ended September 30, 2006, the Partnership completed approximately $190,000 of capital improvements at Bronson Place Apartments, consisting primarily of floor covering and roof replacements, structural and swimming pool upgrades, gutter replacement, and construction related to the fire discussed in “Results of Operations”. These improvements were funded from operating cash flow and insurance proceeds.  The Partnership regularly evaluates the capital improvement needs of the property. While the Partnership has no material commitments for property improvements and replacements, certain routine expenditures are anticipated during the remainder of 2006. Such capital expenditures will depend on the physical condition of the property as well as anticipated cash flow generated by the property.

DeFoors Crossing Apartments

During the nine months ended September 30, 2006, the Partnership completed approximately $27,000 of capital improvements at DeFoors Crossing Apartments, consisting primarily of floor covering and appliance replacements. These improvements were funded from operating cash flow. The Partnership regularly evaluates the capital improvement needs of the property. While the Partnership has no material commitments for property improvements and replacements, certain routine expenditures are anticipated during the remainder of 2006. Such capital expenditures will depend on the physical condition of the property as well as anticipated cash flow generated by the property.

The additional capital expenditures will be incurred only if cash is available from operations or from Partnership reserves. To the extent that capital improvements are completed, the Partnership's distributable cash flow, if any, may be adversely affected at least in the short term.

The Partnership’s assets are thought to be generally sufficient for any near-term needs (exclusive of capital improvements) of the Partnership.  On October 21, 2005, the Partnership obtained financing for Bronson Place Apartments with a mortgage loan in the principal amount of approximately $1,912,000. The outstanding balance at September 30, 2006 was approximately $1,886,000. The loan was financed under a permanent credit facility (“Permanent Credit Facility”) with Fannie Mae.  The Permanent Credit Facility has a maturity of September 16, 2007, with one five-year extension option. The Permanent Credit Facility includes properties in other partnerships that are affiliated with the General Partner. The Permanent Credit Facility creates separate loans for each property.  The loans under the Permanent Credit Facility are not cross-collateralized or cross-defaulted with the other property loans. The loan encumbering Bronso n Place Apartments has a variable interest rate of the Fannie Mae discounted mortgage-backed security index plus 105 basis points. The rate was 6.27% at September 30, 2006 and resets monthly. Monthly principal payments are required based on a 30-year amortization schedule using the interest rate in effect during the first month that the mortgage encumbering Bronson Place Apartments was financed under the Permanent Credit Facility. The loan is prepayable without penalty.  As a condition of making the new mortgage, the lender required an affiliate of the Partnership to guarantee the obligations and liabilities of the Partnership with respect to the new mortgage.

The Partnership distributed the following amounts during the nine months ended September 30, 2006 and 2005 (in thousands, except per unit data):

	Nine Months	Per Limited	Nine Months	Per Limited
	Ended	Partnership	Ended	Partnership
	September 30, 2006	Unit	September 30, 2005	Unit
Operations	$   110	$ 1.79	$  380	$ 6.16
Sale (1)	--	--	4,842	78.51
	$   110	$ 1.79	$5,222	$84.67

(1)

Proceeds from the July 2005 sale of Meadow Wood Apartments.

Future cash distributions will depend on the levels of net cash generated from operations, and the timing of debt maturity, property sales and/or financings. The Partnership's cash available for distribution is reviewed on a monthly basis. There can be no assurance, however, that the Partnership will generate sufficient funds from operations after capital improvements to permit additional distributions to its partners during the remainder of 2006 or subsequent periods.

Other

In addition to its indirect ownership of the sole general partner of the Partnership, AIMCO and its affiliates owned 24,498 limited partnership units (the "Units") in the Partnership representing 40.12% of the outstanding Units at September 30, 2006. A number of these Units were acquired pursuant to tender offers made by AIMCO or its affiliates. It is possible that AIMCO or its affiliates will acquire additional Units in exchange for cash or a combination of cash and units in AIMCO Properties, L.P., the operating partnership of AIMCO, either through private purchases or tender offers. Pursuant to the Partnership Agreement, unitholders holding a majority of the Units are entitled to take action with respect to a variety of matters that include, but are not limited to, voting on certain amendments to the Partnership Agreement and voting to remove the General Partner. As a result of its ownership of 40.12% of the outstanding Units at Septemb er 30, 2006, AIMCO and its affiliates are in a position to influence all such voting decisions with respect to the Partnership. Although the General Partner owes fiduciary duties to the limited partners of the Partnership, the General Partner also owes fiduciary duties to AIMCO as its sole stockholder. As a result, the duties of the General Partner, as general partner, to the Partnership and its limited partners may come into conflict with the duties of the General Partner to AIMCO as its sole stockholder.

Critical Accounting Policies and Estimates

The financial statements are prepared in accordance with accounting principles generally accepted in the United States, which require the Partnership to make estimates and assumptions. The Partnership believes that of its significant accounting policies, the following may involve a higher degree of judgment and complexity.

Impairment of Long-Lived Assets

Investment properties are recorded at cost, less accumulated depreciation, unless the carrying amount of the asset is not recoverable.  If events or circumstances indicate that the carrying amount of a property may not be recoverable, the Partnership will make an assessment of its recoverability by comparing the carrying amount to the Partnership’s estimate of the undiscounted future cash flows, excluding interest charges, of the property.   If the carrying amount exceeds the aggregate undiscounted future cash flows, the Partnership would recognize an impairment loss to the extent the carrying amount exceeds the estimated fair value of the property.

Real property investments are subject to varying degrees of risk.  Several factors may adversely affect the economic performance and value of the Partnership’s investment properties.  These factors include, but are not limited to, general economic climate; competition from other apartment communities and other housing options; local conditions, such as loss of jobs or an increase in the supply of apartments that might adversely affect apartment occupancy or rental rates; changes in governmental regulations and the related cost of compliance; increases in operating costs (including real estate taxes) due to inflation and other factors, which may not be offset by increased rents; and changes in tax laws and housing laws, including the enactment of rent control laws or other laws regulating multi-family housing.  Any adverse changes in these factors could cause impairment of the Partnership’s assets.

Revenue Recognition

The Partnership generally leases apartment units for twelve-month terms or less.  The Partnership will offer rental concessions during particularly slow months or in response to heavy competition from other similar complexes in the area.  Rental income attributable to leases, net of any concessions, is recognized on a straight-line basis over the term of the lease.  The Partnership evaluates all accounts receivable from residents and establishes an allowance, after the application of security deposits, for accounts greater than 30 days past due on current tenants and all receivables due from former tenants.  

ITEM 3.

CONTROLS AND PROCEDURES

(a)

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

(b)

Internal Control Over Financial Reporting. There have not been any changes in the Partnership’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter

to which this report relates that have materially affected, or are reasonably likely to materially affect, the Partnership’s internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1.

LEGAL PROCEEDINGS

AIMCO Properties L.P. and NHP Management Company, both affiliates of the General Partner, are defendants in a lawsuit alleging that they willfully violated the Fair Labor Standards Act (“FLSA”) by failing to pay maintenance workers overtime for all hours worked in excess of forty per week. The complaint, filed in the United States District Court for the District of Columbia, attempts to bring a collective action under the FLSA and seeks to certify state subclasses in California, Maryland, and the District of Columbia. Specifically, the plaintiffs contend that AIMCO Properties L.P. and NHP Management Company failed to compensate maintenance workers for time that they were required to be "on-call." Additionally, the complaint alleges AIMCO Properties L.P. and NHP Management Company failed to comply with the FLSA in compensating maintenance workers for time that they worked in excess of 40 hours in a week.   In June 2005 the court conditionally certified the collective action on both the on-call and overtime issues.  Approximately 1,049 individuals opted in to the class. The defendants moved to decertify the collective action on both issues and the plaintiffs have responded.  Because the court denied plaintiffs’ motion to certify state subclasses, in September 2005, the plaintiffs filed a class action with the same allegations in the Superior Court of California (Contra Costa County), and in November 2005 in Montgomery County Maryland Circuit Court.  The California and Maryland cases have been stayed pending the outcome of the decertification motion in the District of Columbia case.  Although the outcome of any litigation is uncertain, AIMCO Properties, L.P. does not believe that the ultimate outcome will have a material adverse effect on its consolidated financial condition or results of operations. Similarly, the General Partner does not believe that the ultimate outcome will have a material advers e effect on the Partnership’s financial condition or results of operations.

ITEM 5.

OTHER INFORMATION

None.

ITEM 6.

EXHIBITS

See Exhibit Index.

SIGNATURES

In accordance with the requirements of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	UNITED INVESTORS INCOME PROPERTIES
	By:   United Investors Real Estate, Inc.
	Its General Partner
Date: November 13, 2006	By:   /s/Martha L. Long
	Martha L. Long
	Senior Vice President
Date: November 13, 2006	By:   /s/Stephen B. Waters
	Stephen B. Waters
	Vice President

UNITED INVESTORS INCOME PROPERTIES

INDEX TO EXHIBITS

Exhibit

Description of Exhibit

 1

Form of Dealer Manager Agreement between the General Partner and the Dealer Manager, including Form of Soliciting Broker Agreement; incorporated by reference to Exhibit 1 to Partnership's Amendment to Registration Statement (File No. 33-20350) previously filed on May 2, 1988.

 1.1

Amendment to Dealer Manager Agreement; incorporated by reference to Exhibit 1.1 to Post-Effective Amendment No. 2 to Partnership's Registration Statement previously filed on March 21, 1989.

 4.1

Form of Subscription Agreement; incorporated by reference as part of the Prospectus of Partnership contained in Partnership's Amendment to Registration Statement previously filed on May 2, 1988.

 4.2

Form of Agreement of Limited Partnership of Partnership; incorporated by reference as part of the Prospectus of Partnership contained in Partnership's Amendment to Registration Statement previously filed on May 2, 1988.

 4.3

Tenth Amendment to Agreement of Limited Partnership of Partnership; incorporated by reference to Exhibit 4.3 to Partnership's Quarterly Report on Form 10-Q previously filed on May 15, 1989.

4.4

Certificate of Limited Partnership (Exhibit 3 to Partnership's Current Report on Form 8-K filed on April 29, 1991, is incorporated herein by reference).

4.5

Amendment to Agreement of Limited Partnership effective March 28, 2005; incorporated by reference to Exhibit 4.5 to Partnership’s Quarterly Report on Form 10-QSB filed on May 13, 2005.

10.2

Agreement of Purchase and Sale, dated June 22, 1988, between United Investors Real Estate, Inc., as nominee for United Investors Income Properties, as purchaser, and Nilsen/Bay Ridge Development, Inc. and MBIV Development, as seller, relating to Bronson Place Apartments; incorporated by reference to Exhibit 10.1 to Partnership's Quarterly Report on Form 10-Q previously filed on August 11, 1988.

10.3

Agreement of Purchase and Sale, dated October 20, 1988, between United Investors Real Estate, Inc., as purchaser, and Defoors Crossing Associates, Ltd., as seller, relating to Defoors Crossing Apartments, and amendments thereto; incorporated by reference to Exhibit 10.3 to Post-Effective Amendment No.1 to Partnership's Registration Statement previously filed on February 1, 1989.

10.8

Stock Purchase Agreement dated December 4, 1992, showing the purchase of 100% of the outstanding stock of United Investors Real Estate, Inc. by MAE GP Corporation; incorporated by reference to Exhibit 10.8 to Partnership's Current Report on Form 8-K previously filed on December 31, 1992.

10.9

Purchase and Sale Contract between United Investors Income Properties, a Missouri limited partnership, as Seller, and The Meadow Wood Investors, LLC, an Oregon limited liability company,

UNITED INVESTORS INCOME PROPERTIES

INDEX TO EXHIBITS - CONTINUED

as Purchaser, effective May 10, 2005; incorporated by reference to Exhibit 10.9 to Partnership’s Quarterly Report on Form 10-QSB filed on May 13, 2005.

10.10

Amendment of Purchase and Sale Contract between United Investors Income Properties, a Missouri limited partnership, as Seller, and The Meadow Wood Investors, LLC, a Oregon limited liability company, as Purchaser, effective June 2, 2005 incorporated by reference to Exhibit 10.10 to Partnership’s Current Report on Form 8-K filed August 1, 2005.

10.11

Second Amendment of Purchase and Sale Contract between United Investors Income Properties, a Missouri limited partnership, as Seller, and The Meadow Wood Investors, LLC, a Oregon limited liability company, as Purchaser, effective June 30, 2005 incorporated by reference to Exhibit 10.11 to Partnership’s Current Report on Form 8-K filed August 1, 2005.

10.12

Multifamily Note dated October 21, 2005 between United Investors Income Properties, a Missouri Limited Partnership and GMAC Commercial Mortgage Corporation. (1)

10.13

Guaranty dated October 21, 2005 by AIMCO Properties, L.P. for the benefit of GMAC Commercial Mortgage Corporation. (1)

10.14

Replacement Reserve and Security Agreement dated October 21, 2005 between United Investors Income Properties, a Missouri Limited Partnership and GMAC Commercial Mortgage Corporation. (1)

10.15

Assignment of Security Instrument dated October 21, 2005 between GMAC Commercial Mortgage Corporation and Fannie Mae. (1)

10.16

Multifamily Deed of Trust, Assignment of Rents and Security Agreement dated October 21, 2005 between United Investors Income Properties, a Missouri Limited Partnership and GMAC Commercial Mortgage Corporation. (1)

10.17

Indemnification Agreement dated October 21, 2005 between United Investors Income Properties, a Missouri Limited Partnership and AIMCO Properties, L.P. in favor of GMAC Commercial Mortgage Corporation. (1)

31.1

Certification of equivalent of Chief Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2

Certification of equivalent of Chief Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1

Certification of the equivalent of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

(1)

Incorporated herein by reference to the Registrant’s Current Report on Form 8-K dated October 21, 2005.

Exhibit 31.1

CERTIFICATION

I, Martha L. Long, certify that:

1.

I have reviewed this quarterly report on Form 10-QSB of United Investors Income Properties;

2.

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

3.

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

4.

The small business issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the small business issuer and have:

(a)

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

(b)

Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c)

Disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and

5.

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

(a)

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

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting.

Date:  November 13, 2006

/s/Martha L. Long

Martha L. Long

Senior Vice President of United Investors Real Estate, Inc., equivalent of the chief executive officer of the Partnership

Exhibit 31.2

CERTIFICATION

I, Stephen B. Waters, certify that:

1.

I have reviewed this quarterly report on Form 10-QSB of United Investors Income Properties;

2.

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

3.

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

4.

The small business issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the small business issuer and have:

(a)

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

(b)

Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c)

Disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and

5.

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

(a)

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

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting.

Date:  November 13, 2006

/s/Stephen B. Waters

Stephen B. Waters

Vice President of United Investors Real Estate, Inc., equivalent of the chief financial officer of the Partnership

Exhibit 32.1

Certification of CEO and CFO

Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-QSB of United Investors Income Properties (the "Partnership"), for the quarterly period ended September 30, 2006 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Martha L. Long, as the equivalent of the Chief Executive Officer of the Partnership, and Stephen B. Waters, as the equivalent of the Chief Financial Officer of the Partnership, each hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

(1)

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

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

      /s/Martha L. Long

Name: Martha L. Long

Date: November 13, 2006

      /s/Stephen B. Waters

Name: Stephen B. Waters

Date: November 13, 2006

This certification is furnished with this Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Partnership for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.