Many investors fall into the trap of concentrating all their financial resources in a single “basket.” However, as the famous saying goes, losing that basket means losing everything. This is where understanding what is diversification in real estate becomes essential.

What is diversification in real estate? Diversification in finance is the strategic allocation of capital to manage risk, with the ultimate aim of balancing losses in one asset class with gains in another. This approach ensures that investments are spread across multiple projects rather than concentrated in a single one.