Diversification.... needed or not?

[Adam Bileckyj]

Hi everyone! As a financial advisor having a diversified portfolio is essential. Is that the same with real estate investing or is there actually more risk because you will have a difficult time learning and exploiting a niche if you try and diversify? Do people diversify between single family, multi-family, appreciation investments, cash flow investments,  coastal properties, midwestern properties etc...

I am a newb but own a primary residence (in San Diego) and one rental in AZ which are both more appreciation plays and I've been looking at small multi-family and middle America cashflow properties. 

Thanks in advance!