Financial institutions lend money to real estate companies so they can finance their investments. Recent research has shown that real estate companies struggle to make money to the point that they are unable to repay their loans. One important tactic that real estate companies employ to stay competitive and increase their profitability is diversification. The general objective of the study was to establish the effect of product diversification strategies on the performance among real estate companies in coast region, Kenya. The study was based on the modern portfolio theory. The study adopted an explanatory research design and the target population was 319 real estate firms at the coast region, Kenya. A sample of 177 real estate firms were for the study. Correlation results indicated that concentric diversification strategy, vertical diversification strategy, horizontal diversification strategy, and conglomeration diversification strategy had a significant correlation with real estate performance. Multiple Regression results showed that concentric desertification strategy, vertical product diversification strategy, horizontal product diversification strategy, and conglomerate product diversification strategy had positive and significant effect on real estate performance. The study concluded that real estate firms should implement concentric diversification strategy, vertical product diversification strategy, horizontal product diversification strategy significantly and conglomerate product diversification strategy so as to increase real estate performance.