OPINION OF GOODWIN,PROCTER & HOAR LLP,REIT STATUS

EXHIBIT 8.3

GOODWIN, PROCTER & HOAR LLP

COUNSELLORS AT LAW
EXCHANGE PLACE
BOSTON, MASSACHUSETTS 02109-2881
TELEPHONE (617)570-1000
TELECOPIER (617)523-1231


As of May 5, 1998


Bay Apartment Communities, Inc.
4340 Stevens Creek Blvd. - Suite 275
San Jose, CA 95129

Avalon Properties, Inc.
15 River Road
Wilton, CT 06897

Re: Certain REIT Tax Matters
------------------------

Ladies and Gentlemen:

This opinion is rendered in our capacity as counsel to Bay Apartment
Communities, Inc., a Maryland corporation ("Bay"), whose principal office is
located at 4340 Stevens Creek Boulevard, Suite 275, San Jose, California 95129,
in connection with the filing of a Joint Proxy Statement/Prospectus (the "Joint
Proxy Statement/Prospectus") included in the Registration Statement on Form S-4
(the "Registration Statement") filed by each of Bay and Avalon Properties, Inc.,
a Maryland corporation ("Avalon"), with the Securities and Exchange Commission
under the Securities Act of 1933, as amended, and declared effective on May 5,
1998. In rendering this opinion, we have reviewed the Agreement and Plan of
Merger, dated as of March 9, 1998, by and between Bay and Avalon (the "Merger
Agreement"), the Joint Proxy Statement/Prospectus and such records, certificates
and other documents as we have deemed necessary or appropriate for purposes of
rendering the opinion set forth herein. The foregoing documents are referred to
herein as the "Documents."

In rendering the opinion set forth herein, we have assumed (i) the
genuineness of all signatures, (ii) the authenticity of all documents submitted
to us as originals, (iii) the conformity to the original documents of all
documents submitted to us as copies, (iv) the authority and capacity of the
individual or individuals who executed any such documents on behalf of any
person, (v) the conformity to the final documents of all documents submitted to
us as drafts, (vi) the accuracy and completeness of all records made available
to us, and (vii) the factual accuracy of all representations, warranties and
other statements made by all parties. We also have assumed, without
investigation, that (i) all documents, certificates,

GOODWIN, PROCTER & HOAR LLP

Bay Apartment Communities, Inc.
Avalon Properties, Inc.
As of May 5, 1998
Page 2


representations, warranties and covenants relied upon in rendering the opinion
set forth below, and that were given or dated earlier than the date of this
letter, continue to remain accurate insofar as relevant to the opinion set forth
herein from such earlier date through and including the date of this letter and
(ii) all representations made "to the best knowledge of" any person(s) or with
similar qualification are and will be true, correct and complete as if made
without such qualification.

In rendering the opinion below, we have relied on certain representations
from Bay and Avalon set forth in certificates (collectively, the "Certificates,"
and each a "Certificate") relating to Bay's and Avalon's qualification as a real
estate investment trust. We also have relied on the statements regarding the
operation and ownership of Bay, Avalon and their affiliates contained in the
Documents. We have made no investigation of the accuracy of such
representations or statements, and the following opinion is expressly
conditioned on the accuracy of such representations and statements. We have
assumed that the Merger and related transactions contemplated by the Documents
will be consummated in accordance with the Documents and as described in the
Joint Proxy Statement/Prospectus (including satisfaction of all covenants and
conditions to the obligations of the parties without amendment or waiver
thereof) and that all entities have operated and will operate in accordance with
governing documents and applicable laws.

The opinion expressed below is based on the Internal Revenue Code of 1986,
as amended (the "Code"), the Income Tax Regulations and Procedure and
Administration Regulations promulgated thereunder, and existing administrative
and judicial interpretations thereof, all as they exist as of the date hereof.
Any changes to the foregoing authorities may result in modifications of the
opinion expressed below.

Based upon and subject to the foregoing, we are of the opinion that
commencing with the taxable year ending December 31, 1994, the form of
organization of Bay and its operations and anticipated operations as described
in the Certificates and the Documents are such as to have enabled Bay to qualify
as a real estate investment trust under the Code and to continue to so qualify
for the taxable year ending December 31, 1998 and for subsequent years, provided
that in each such year Bay meets (or, with respect to that portion of Bay's 1998
taxable year ending on the date hereof, has met) the applicable asset
composition, source of income, shareholder diversification, distribution, record
keeping and other requirements of the Code necessary for a corporation to
qualify as a real estate investment trust.


GOODWIN, PROCTER & HOAR LLP


Bay Apartment Communities, Inc.
Avalon Properties, Inc.
As of May 5, 1998
Page 3


* * * *

We express no opinion with respect to the transactions described herein
other than the opinion expressly set forth herein. This opinion is furnished
for the purpose of being included as an exhibit to the Registration Statement,
and we hereby consent to the filing of this opinion as an exhibit to the
aforementioned Registration Statement and to the reference to this firm under
the captions "Certain Federal Income Tax Considerations" and "Legal Matters" in
the Registration Statement and the Joint Proxy Statement/Prospectus which is a
part thereof.

Very truly yours,



/s/ GOODWIN, PROCTER & HOAR LLP