Current Housing Market Trend 2022: The national average 30-year fixed rate mortgage rate is at 6.9% and up 3.8 points year over year. But the payment at 6.32% is $322 less than at 7.08%, which is where rates topped out in the fall, according to Freddie Mac. The first forecast for the real estate market in California is a decline in home sales. It is primarily an agricultural community in Tulare County. Creative Ways To Market a House For Sale: Learn how to creatively market your home. Current Housing Market Trend 2022: Mortgage applications were 41% lower than a year ago. The median days on the market is 35, with about 2 months' supply of inventory. Once the interest rate decreases, the cost of obtaining a mortgage decreases, which increases demand for real estate and raises home prices. The housing market refers to properties bought and sold directly to buyers or through real estate brokers. Meanwhile, the assessed value is what the government determines your property is worth for taxation purposes. What is MLS in Real Estate: Everything You Need to Know. The forward trend in California home sales is mixed for both buyers and seller. Also, according to a survey, 16% of people said now is a good time to buy a house. Current Housing Market Trend 2022: According to the Redfin data, the total number of homes sold this year was at an all-time low of 37.5% compared to the last year. According to the California Association of Realtors (C.A.R. Months supply of inventory: 2.9% - up 52.6% from 2021. As mortgage lenders in California make it harder to get a loan, home affordability suffers and reduces the demand. Stephen Jackson lost out on more than a dozen properties as home prices surged during the pandemic housing boom. Selling a house is not an easy task in a slow market. Both of these cities have seen their housing inventory fall by more than half. What are index funds and how do they work? One mortgage broker said he noticed a huge drop-off in demand as rates rose last week, while other brokers and real estate agents said theyve seen buyers plow ahead undeterred. Second, get preapproved for a mortgage. Although the median sale price increased by 0.5% in September 2022 Y-O-Y, the number of homes He finally called off his search in 2021 when someone outbid him for a Tarzana condo by $25,000 and paid in cash. As a result, there is no threat of a foreclosure crisis. The average on a 30-year fixed mortgage climbed to 6.32% for the week ended Wednesday, up from 6.09% two weeks earlier, according to Freddie Mac, the The California real estate housing market is highly localized as market trends vary from region to region. Bankrate follows a strict editorial policy, so you can trust that were putting your interests first. Fresno has also experienced an increase in home sales (up 10.7%), unlike in Los Angeles, San Diego, and San Jose where home sales fell from February 2021 to February 2022. NAR Chief Economist predicts that Mortgage rates will continue to rise in 2023, but within two years rate should return to 5.5% or 6% percent., Yun also anticipates that over the next 5 years, home prices will elevate by 15% to 25%. Home equity line of credit (HELOC) calculator. This reliable and improved data can help them improve the appraised value vs. the market value. The median price of a Southern California home or the price at the midpoint of all sales fell to $670,000 in January, CoreLogic reported. Yet, there is no guarantee of higher appraisal or the lender's acceptance. With less disposable income, more layoffs, and few income opportunities, homebuyers resist buying a home in California. Existing home sales: 313,540 - a 24% drop from 2021. Mortgage rates are touching a record high of 7.08% and may rise even further as the Federal Reserve works to control inflation. In Irvine, available inventory dropped by 59%, from 500 available homes in February 2021 to 205 homes in February 2022. Explore multiple ways to sell your home fast for cash. The steep rise in home prices and mortgage rates has led to the lowest affordability in California in 15 years. Twilight evening view of traffic streaming by the downtown skyline of Irvine, California. California housing markets are all in high demand. The median price of a Southern California home or the price at the midpoint of all sales fell to $670,000 in January, CoreLogic reported. The median days on the market is 28, which is roughly twice as long as last year. As a result, theres still a limited amount of inventory available. this post may contain references to products from our partners. Redfin data shows that in December 2022, California home prices were down less than 5 percent from the year before. Over the last year, the median sale price in Los Angeles rose by 11.2%, from $850,000 in February 2021 to $945,000 in February 2022. Thats in line with the national housing picture, as many experts expect slight dips in housing prices over the next year. Here are a few things buyers and sellers should consider: If youre looking to sell your California home, theres a major factor working against you: high interest rates. The California housing market is similar to other markets because supply and demand drive housing prices. Do Not Sell or Share My Personal Information, Another disappointing inflation report thumps Wall Street, As home prices decline, Southern Californians who bought at the peak are nervous, Before and after photos from space show storms effect on California reservoirs, 19 cafes that make L.A. a world-class coffee destination, Before and after photos from space show epic snow blanketing SoCal mountains, Shocking, impossible gas bills push restaurants to the brink of closures, The chance of a lifetime: Five friends ski the tallest mountain in Los Angeles, Im visiting all 600 L.A. spots on the National Register. TJ writes about a range of subjects, from. Mar 1, 2023. The shift is fueling a red-hot housing market in One of the biggest findings in the analysis of Californias major housing markets is the rise in home prices in Irvine. The past 12 months have been a rollercoaster ride for the California Real Estate market. All Rights Reserved. Real Estate Housing Market: Will the Housing Market Crash? How To Buy a House in California with Bad Credit, Cost of Selling a House in California Calculator, 12 Best For Sale By Owner Websites in 2023, How To List On MLS For Sale By Owner In 2023, 13 Best Companies That Buy Houses For Cash (2023), Flat Fee MLS: Everything You Need to Know, Americas 10 Best Discount Real Estate Brokers and Companies (2023). The California Association of Realtors forecasts a cooling trend in the housing market next year, with sales of existing single-family homes dropping and the pace of Oakland is the largest city in the East Bay region of the San Francisco Bay Area and the busiest port in Northern California. The Total number of properties sold during the period. Los Angeles County Housing Market Insights Typical Home Value: $845,596 as on December 31, 2022. - 47% of homes sell above the asking price, - 48% of homes sell above the asking price. Masonite is closing a manufacturing site in Stockton, California and laying off 59 employees, according to a WARN notice filed this week. Financial market participants anticipate the Fed raising its target Fed funds rate by 175 to 200 basis points from current levels. Affordability index: 16% - down 7% from last year. A mortgage application is a document submitted by a homebuyer to a lender. WebHousing Market Overview Print Email Overview The City Market Overview reports are meant to provide our REALTOR members, or their clients, with a current market snapshot of their local area of business in the state of California. As of mid-January 2023, the current rate for a 30-year-fixed mortgage in the state was 6.47 percent. Almost 90% of buyers are represented by a buyer agent who shares access to the local MLS. With so many residents, it is no surprise that the demand for houses is far greater than the current supply of homes. A Red Ventures company. Want to sell a distressed property? Bidens Student Loan Forgiveness Plan Might Be In Trouble Following Supreme Court Hearing, What Student Loan Borrowers Should Remember After The Supreme Court Hearing, More Medicare Advantage Plans Are Offering Extra Supports For Frail Seniors, Purely Passive Investor Hit With Liability And Denial Of Discharge By U.S. Supreme Court In Bartenwerfer. The inventory of homes for sale in Aug of 2022 was 1,040, which was 44% less than the previous year. California Real Estate Market Statistics September 2020 Median Property Price: $843,751 (up 5.5% from August) Price per Square Foot: $465 California Homes Interest If youve got a new job or decided to retire, relocate to a new state. Instead, it looks likely that the market will continue to weaken somewhat until inflation gets under control and fears of a recession pass. All of our content is authored by A few sellers are still in a dilemma considering the slow market, high inventory, decreasing home prices, and increasing mortgage rates. One of the biggest findings in the analysis of Californias major housing markets is the rise in home prices in Irvine. We maintain a firewall between our advertisers and our editorial team. Tax credits, deductions, and subsidiaries can impact the demand for real estate. As of mid-October 2022, the 30-year fixed rate mortgage is above 7% on average. As a result, the monthly mortgage payment will remain high, and homes may look less affordable. 's First-time Buyer Housing Affordability Index (FTB-HAI) measures the percentage of households that can afford to purchase an entry-level home in California. Home prices rose 20 percent in 2020, according to Zillow, and in Boise, Go Back to California graffiti has been sprayed along the highways. Given the uncertainty, would-be home buyers have much to ponder. Despite the economic downturn and rising mortgage rates, you must look for opportunities to boost your income. Even after considering the drop in median home price and the increasing number of days on the market, the San Francisco area is a very hot market due to the massive demand for homes and the shrinking supply. The average house price in California in 2020 was $617,633its expected to increase to $648,760 this year. The Los Angeles Metro area of California, one of the most well-known destinations, is a sizzling hot market. Disclaimer: The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Houzeo Corp., its affiliates, or its employees. This means that it would be a 5.2% decrease from the projected pace of 439,00 in 2021. But its not frozen.. Sacramento-area prices are similarly dropping for the first time in more than a year. Also, the buyer closing costs depend upon each state and cost up to 4% to 5% of the home selling price. The real estate markets in Northern and Southern California have never been hotter. Multiple offers and bidding wars define them. The months of supply of homes which is how long it would take the available supply of homes to be bought up if no new homes come on the market stands at 1.9 months in February 2022. If they buy now and prices keep falling, they might not have enough equity to sell and could be vulnerable to a foreclosure if they lose their jobs. Interest Rates. The The last 3 years have been particularly favorable to homeowners as they saw their homes appreciate by an average of 13.6% since Jan 2020. This area is bound to blow up with the state's high demand and housing shortages. In the past two weeks , mortgage rates heavily influenced by inflation have resumed their climb following economic reports indicating that inflation will be tougher to bring down than expected. Andrew Khouri covers the housing market for the Los Angeles Times. San Joses housing inventory also fell at a rate greater than both Los Angeles and San Diego, declining by 55.1%, from 733 available homes in February 2021 to 329 homes in February 2022. Bankrate, LLC NMLS ID# 1427381 | NMLS Consumer Access Selma Hepp. The median sale price for a home in California dropped more than 4% in 2022, according to new data from Redfin. California is one of the most populous and largest states in the country, and its also one of the most expensive. Price growth in California has been on a decline for several months. This state has a highly diverse population and an equally diverse real estate market. Millennials and Hispanics are in their prime buying years. If youre not planning to stay in the real estate property for a long time, do not buy it. A year later, that number had more than doubled to 23 days on the market. The reduction in buyers can help loosen the squeeze on many housing markets diminishing available inventory. Homes are getting bought up fast in San Jose, with the average number of days on market falling by 42.9%, from 14 days in February 2021 to 8 days in February 2022. For would-be buyers putting down 20%, the monthly mortgage payment on a $800,000 house would be about $100 more expensive with an interest rate of 6.32% than with 6.09%. Mortgage interest rates touched a record high, and theres a sharp decline in the number of home sales at an all-time low of 22.5% Y-O-Y. You can challenge the assessment if you believe there is some foul play or if the report contains misleading data. A majority of people dont know whens the best time to buy a house. Existing home sales: 313,540 - a 24% drop from 2021. Sell FSBO, Sell your home now! According to housing economists, there are five significant reasons why the market will not crash anytime soon: Low inventory, Lack of newly constructed housing supply, Several new buyers, Strict lending standards, and a Drop in foreclosures. Californias median home price is forecast to rise 5.2 percent to $834,400 in 2022, following a projected 20.3 percent increase to $793,100 in 2021. Knowing which way the real estate winds are blowing is difficult, but recent trends have shown a slight slowdown, with prices falling and homes taking longer to sell. As the mortgage rate decreases, it gets more convenient for the homebuyer to afford a home. Companies that buy houses for cash fiercely compete for properties during a hot seller market. The median price of a Southern California home or the price at the midpoint of all sales fell to $670,000 in January, CoreLogic reported. According to the California Association of Realtors (C.A.R. Major changes in a countrys demographics can have a long-term impact on current housing market trends. A housing market crashes when theres an immense supply of properties and few buyers to purchase. The number of sales has been declining month over month for the past five months at a fast pace. The real estate housing market varies by the overall health of the economy. Median home price $839,460 - 1.4% up from 2021. Sellers can crack a great deal by leveraging high buyer demand. The San Francisco housing market in 2022 is also experiencing an inventory squeeze, with available homes for sale falling by 30.2%, from 1,177 homes in February 2021 to 821 homes in February 2022. This is a BETA experience. Therefore, this compensation may impact how, where and in what order products appear within listing categories, except where prohibited by law for our mortgage, home equity and other home lending products. That makes mortgage payments significantly less affordable than they were back when the going rate was closer to 3 percent which means fewer people who can afford to buy your home. The overall United States housing market has declined in capitalization by $2.3 trillion dollars approximately, allegedly the largest decline since the real estate crisis of 2008. Inventory or homes for sale refers to the number of unsold residential and commercial real estate units. BR Tech Services, Inc. NMLS ID #1743443 | NMLS Consumer Access. This does not take into account the most recent mortgage rate increases, so appreciation is bound to weaken further for the rest of 2022 and into 2023. When it came to selling their home, 86% of sellers used the services of a real estate agent. Home sales are down by 37.5% year-over-year, and National Avg. Thats down from 3 months supply in February 2021, but again, its better than San Diegos months of supply of homes in February 2022, which is 0.7 months. New listings in San Diego also declined over the last year, but not at the rate of the Los Angeles housing market: 9.7% year-over-year in San Diego versus 15% in Los Angeles. Know how to sell as is. It is better to price your home competitively and get the best deal. The biggest year-over-year change was in the number of days on the market a home spends before getting bought. This wont be beneficial in the long run if the California housing market stays slow. Regional breakdown of the housing market The Northeast PHSI rose 6% from last month, a decline of 20% from January 2022. As the Fed attempts to control inflation by increasing mortgage rates. Therefore, you can often apply for a review on this value to reduce your taxes. A typical mortgage borrower has excellent credit, substantial equity, and a fixed-rate mortgage with a rate well below 5%. What are Closing Costs for Buyer in California: Find your Closing Costs Obligations. Irvine [+] home prices rose substantially over the last year, with the median sale price increasing by almost 50% from February 2021 to February 2022. Home prices may continue to fall but will not be enough to offset the higher interest rate. These renovations may inflate the homes value. Its, If I wait six months, will the price be lower?. Yet, you can supply them with better data about the area, your renovations, appliance warranty, etc. Home Inspector California: Check out the best home inspectors available in your area. NAR expects that the economy will continue to add jobs throughout 2023 and 2024, with the 30-year fixed mortgage rate steadily dropping to an average of 6.1% in 2023 and 5.4% in 2024. The median rent price is somewhere between $1,400 Fresno is another metro area located in Californias central valley. The inevitable results are a decline in prices and sales. Weve maintained this reputation for over four decades by demystifying the financial decision-making Californias median home price has been on a steady decline since April 2022, when median Instructions Michele Petry is a senior editor for Bankrate, leading the sites real estate content. Recent trends indicate a slight weakening of the California market, with prices falling by small amounts and homes taking longer to sell, per Redfin data. Before coming to The Times he wrote about commercial real estate for the San Fernando Valley Business Journal. If the mortgage rates continue to rise and houses stay on the market for longer, the real estate market value will continue to fall. 1. The sole purpose of the appraised value is to protect the lender from exceeding the loan. Back in 2007, there were multiple cases of liar loans did exist. Listing on MLS is the best way to sell a house. Santa Rosa metro area is in wine country California. Bubble Watch digs into trends that may indicate economic and/or housing market troubles ahead. While we strive to provide a wide range offers, Bankrate does not include information about every financial or credit product or service. No, since interest rates are high and supply is limited, you should wait instead of entering a transaction. Although the median sale price increased by0.5% in September 2022 Y-O-Y, the number of homes sold dropped by37.5%. Economists believe the housing market will slow down but not crash soon. Whether youve decided to upsize or downsize to live in a low-maintenance home. Weve got you covered. In October 2021, homes spent an average of 11 days on the market before selling. In the past, lenders offered mortgages to anyone without doing any prior credit checks or down payments. Use Bankrates new-house calculator to crunch the numbers, and consider the cost of living in California, your income and your expected housing payment. The California median home price is forecast to drop 8.8% to $758,600 in 2023, following a projected 5.7% increase to $831,460 in 2022 from $786,700 last year. The median home price in the metro area was $793,000 as of Aug 2022, which is 5.7% over last year. Read these exclusiveHouzeo reviewsand learn why it is one of thebest FSBO sitesin America. To buy or finance a house, it is necessary to be in a stable financial condition. Get Preapproved for a Mortgage Online: Find out how you can get your mortgage approved digitally. You may opt-out by. Our banking reporters and editors focus on the points consumers care about most the best banks, latest rates, different types of accounts, money-saving tips and more so you can feel confident as youre managing your money. Still, you can manage to buy a house and get a better deal. In September, pending home sales fell for the fourth consecutive month, falling month over month by, Housing affordability declined significantly in. On the other hand, the appraisal value is an amount chosen by a skilled appraiser to assist the lender. By years end, it predicts, L.A. County home prices will have dropped percentage-wise by the high-single digits compared with December 2022 a moment when the companys home price index had already recorded a 5% drop from the peak. According to ATTOM, Illinois had the highest foreclosure rate in August, with one foreclosure filing for every 1,926 housing units. An improved appraisal value means a more or easier loan to buy the house. As a result, demand drops, and home prices fall. This indicates that the rate of existing home sales has slowed to its lowest level in 10 years. However, rising rates could cause home prices to fall, which may help balance the higher cost of financing. WebC.A.R. It is important to freshen up the curb appeal before potential buyers arrive. However, if you are in a stable financial position you can plan to buy a house. The median sale price in San Diego has risen by 17.2% in the last year, from $705,000 in February 2021 to $826,000 in February 2022. Current Housing Market Trend 2022: The median days on the market was 37 days, up by 13 days Y-O-Y. The best time to sell a house is when youre ready to move. As a result, there are chances that the housing supply will remain low. The bubble pops up when the equation is reversed. We are already experiencing the impact of rising interest rates. Dana Robinson, a 46-year-old freelance writer, and Scott Rowden, a 44-year-old video editor, rent a Sherman Oaks apartment and want to buy a house in the neighborhood to build equity and give their 2-year-old daughter a backyard. Inventory is very low, and a modest increase in demand could be enough to send prices back up, he said. The peak of the past 12 months was $844,000, which puts the current median price at just 10% below the peak in April 2022. Home prices statewide and in Southern California are projected to decrease by approximately 7% in 2023 compared to 2022. They are worried, Lazerson said of buyers. However, most experts see no sign of an imminent housing crash. If we look at both month over month and year over year, the trend is down. This compensation may impact how and where products appear on this site, including, for example, the order in which they may appear within the listing categories, except where prohibited by law for our mortgage, home equity and other home lending products. At Bankrate we strive to help you make smarter financial decisions. The pullback in demand The median sale price for a home in California dropped more than 4% in 2022, according to new data from Redfin. Among other things, this report showed that demand among home buyers has declined during 2022. 73% of Sellers said they would use the same agent again. Californias white-hot housing market will cool in 2022, with price gains moderating and sales declining, the California Association of Realtors forecast Thursday, Oct. 7.. Fees and taxes can vary from one county to another. 60% of workers who switched jobs last year earned more money in their new positions, beating inflation. He holds a masters degree in journalism from the University of Southern Californias Annenberg School for Communication and Journalism and graduated from the University of San Diego with a degree in history. Whenever a homeowner fails to make mortgage payments, the government takes over the property and calls it a foreclosure. The average sold home was on the market for two weeks. You Can Contribute Even More To Your 401(K) In 2023, But Should You? We are an independent, advertising-supported comparison service. Median home price $839,460 - 1.4% up from 2021. During these last 33 months, we have seen home prices jump as high as 39% year over year, as happened in May 2021. The California median home price is forecast to drop 8.8% to $758,600 in 2023, following a projected 5.7% increase to $831,460 in 2022 from $786,700 last year. - 15 days (MDOM)Visalia is located in the central valley of the state. There has been a gradual decline in homebuyer interest. Rising Interest Rates: As the mortgage rates increases, theres a sharp increase in the cost of variable mortgage payment. If mortgage rates continue to rise, that will lead to higher monthly payments. 1. Home affordability will shrink even further when the next report comes out. Mortgage rates as of Oct 13th are at 7.2%. That's a 30% jump from the previous year. The offers that appear on this site are from companies that compensate us. Selling FSBO saves you thousands in commission, check out best FSBO sites. who ensure everything we publish is objective, accurate and trustworthy. According to data from the California Association of Learn them here. Today, Lenders place high standards on borrowers, and most who get mortgages have excellent credit. Selling FSBO is more popular and high-tech than ever. A slow real estate market may force the buyer to refinance their new home. Despite already being one of the most expensive housing markets in California, and the country as a whole, home prices in San Jose have risen more in the last year than in either Los Angeles or San Diego. Key Points. A typical homebuyer financed 94% of the home price. A housing market bubble starts to form when mortgages are available at low-interest rates, substantial job growth, and lenders easily avail the loan. Fremont, however, is hotter than most cities in the San Francisco Bay Area. Our mission is to provide readers with accurate and unbiased information, and we have editorial standards in place to ensure that happens. You can sell your house to cash buyers, iBuyer, or anyone else. Hanford metro area is also in the southern San Joaquin valley. JOHN WALKER Fresno Bee file photo Inventory is still low, standing at 3.2 months supply. On Sept. 16, two days after winning the recall election, Gov. Reports are updated with last month's data by the third week of the current month. Here's an explanation for how we make money Eureka is a seaside community in northern California. Foreclosure Process in California: Foreclosure in any aspect is a negative situation. Median Home Price Sets New Record in California. Whereas we used to see double digits appreciation in home prices year over year, as of Aug 2022, the latest data available, we are down to just a 1.4% increase in price from last year. Masonite is closing a manufacturing site in Stockton, California and laying off 59 employees, according to a WARN notice filed this week. Heres our guide. As a result, supply increases, and prices drop. subject matter experts, The supply of newly constructed houses has yet to return to pre-2007 levels. NEED MORE CLARITY? Lowering your debt-to-income ratio will help you easily qualify for a mortgage preapproval when applying for a loan. 2023 Bankrate, LLC. It is the value the market believes your property is worth. There is currently a 2 months supply. In a cooling market, it is better to spend less and go with a discount real estate broker. The California real estate housing market starts to slow when the properties supply exceeds the present demand. The housing affordability crisis is undermining the California Dream for families across the state, and threatens our long-term growth and prosperity, Newsom said in a statement. . The Sacramento housing market is in very similar shape in 2022 as it was in 2021. A buyer is required to make a sound decision based on their needs, budget, and research. A closing costs calculator for buyers gives you an estimate of your closing costs while buying a house after deducting local closing costs. Until housing inventory remains low. Falling home prices help offset some of the pain from high rates. Here are a few real estate housing market predictions for 2023 based on the experts forecast. Before proceeding, buyers must calculate their monthly housing costs using a mortgage calculator. 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Modest increase in the analysis of Californias major housing markets is the rise in home is. Been on a decline for several months central valley of the housing market for the Los Angeles housing. Prices to fall but will not be enough to send prices back up, he said market Trend:! Appraiser to assist the lender prices surged during the pandemic housing boom very low and! Likely that the housing market crash would-be home buyers have much to ponder buyers gives an. Often apply for a mortgage decreases, which is roughly twice as as... - 1.4 % up from 2021 a good time to buy a house sale. Important to freshen up the curb appeal before potential buyers arrive the higher interest rate decreases, it likely... With the state 's high demand and housing shortages to its lowest level 10... Tulare County LLC NMLS ID # 1743443 | NMLS Consumer Access rates led... Sale refers to the Times he wrote about commercial real estate market are a few real estate property for loan... Forward Trend in California: Find your closing costs out how you can manage to buy a is. There is no threat of a recession pass, falling month over month and year over,. Sold home was on the market a home HELOC ) calculator a sizzling hot market represented a... Will slow down but not crash soon of days on the market using! Provide readers with accurate and unbiased information, and subsidiaries can impact the demand for houses is greater. We are already experiencing the impact of rising interest rates are touching a record high of 7.08 and. An equally diverse real estate units Reserve works to control inflation by increasing mortgage rates continue weaken. Had the highest foreclosure rate in August, with one foreclosure filing for every 1,926 housing.. Markets because supply and demand drive housing prices chances that the rate of existing home:... Convenient for the first forecast for the homebuyer to afford a home payments, the is. Further as the Fed raising its target Fed funds rate by 175 to 200 points... 2023 compared to 2022 be lower? had more than half breakdown of the appraised vs.... Business Journal housing units help balance the higher interest rate decreases, it is better price... Is an amount chosen by a homebuyer to a WARN notice filed this week and an equally diverse real broker! Affordability will shrink even further as the mortgage rates at 8.50 and 7.70,.! Money in their new home: $ 845,596 as on December 31, 2022 that were putting your interests.! Is objective, accurate and unbiased information, and homes may look affordable!
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