This paper analyzed the risk in direct residential and commercial real estate investments in Calabar, South Eastern Nigeria with a view to providing needed data for comparison and property portfolio Management. A study population of 100 units each of residential and commercial buildings was obtained from five firms of estate surveyors and valuers active in property management in Calabar. Judgement sampling approach was used to select 30 units each of residential and commercial real estate from the study population. Ex post returns from market and appraisal data were analysed to obtain the implied risk over the study period of 17 years. The result shows that mean returns at the sectorial levels of residential and commercial real estate are 23% and 23.82% respectively and 11.27% and 10.06% respectively for the associated risk. The result also reveals that there is a significant difference in total risk between the residential and commercial sectors, the total risk in the residential sector being significantly higher than that of the commercial sector was measured. The result reveals a direct positive and significant relationship meaning that as the risk in residential real estate investment increases that of commercial real estate investment also increases relatively. Generally, the research reveals the commercial sector as being comparatively better than the residential sector in terms of risk and return.