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San Diego and Los Angeles were among the worst cities for real estate investment last year, according to a new report from Compound. The report analyzes single-family housing appreciation in the last 12 months and the volatility and risk of purchasing in each market. San Diego and Los Angeles fell at second and fourth on the 10 worst cities to invest in with 1.29% and 2.1% appreciation, respectively.

“These markets have relatively high volatility. When you invest in a market, you have to generate outsized returns to justify the risk,” Jesse Stein, founder of Compound, tells GlobeSt.com. “These markets can move 15% to 20% in a year, either on the upside or the downside. In investing in those markets, you need to be able to justify the risk that is associated with that volatility will be accompanied by outstanding returns.”

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Kelsi Maree Borland

Kelsi Maree Borland is a freelance journalist and magazine writer based in Los Angeles, California. For more than 5 years, she has extensively reported on the commercial real estate industry, covering major deals across all commercial asset classes, investment strategy and capital markets trends, market commentary, economic trends and new technologies disrupting and revolutionizing the industry. Her work appears daily on GlobeSt.com and regularly in Real Estate Forum Magazine. As a magazine writer, she covers lifestyle and travel trends. Her work has appeared in Angeleno, Los Angeles Magazine, Travel and Leisure and more.

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