Could use some help diagnosing a water leak...

Okay, I just got a used 325i, 1990 with a straight six. I inherited it from my dad. It overheated on my a week ago. Since then I have been working on it with my son. I am hoping to make a connection with him by doing this. We have pulled the pump and put in a new one. Then we checked it out for leaks. The pump seems solid, but there is a leak coming from above the pump and between the valve covers. It is coming from a housing that the thermostat housing is attached to. Does anyone know what this is and if it can be replaced or better yet removed and put back on with a new seal?
Any help would be appreciated.
Also it needs new seats badly. So if anyone is parting out their 325i let me know.

This?

Yes. That looks like what I was talking about. What is it called and is it a likely suspect for a water leak?

That would be the thermostat housing. And yes the gasket that goes between the housing and the head go bad and also there is an o-ring that goes on the thermostat itself. They don't go bad too often though.

Thanks! That is actually what I was thinking that it was, but the bottom part looks to be an integral part of the head. I just want to be sure that I could remove it as well, before I start on this tomorrow.