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Canada's housing market both vigorous and stable
" c0 [4 ^2 O- @* }3 s1 H& p }3 t1 X" o
- Country's market poised to show growth throughout 2006 -2 u) h" f) ?5 n# v" y' ^
! I: u+ l' B \
TORONTO, Sept. 28 /CNW/ - For most of Canada, the housing market/ B5 l4 L4 x1 ^0 |) S
exhibited moderate price increases and stable unit sales during the third( z4 B( k. Y. \& J' G
quarter. Wide regional variances continued to be the dominant characteristic
+ P) Z- p3 `9 M3 _% zin the market, exemplified by frenzied levels of activity and double digit- E3 r+ V; N. z( _
price gains observed in the energy and commodity rich Western provinces, and
2 V( N: F/ I1 a0 q" Xmore reasonable sales volumes and moderate price appreciation in Ontario,' a5 {4 v% |& n \* o. h( L. \; u
Quebec and Atlantic Canada, according to a report released today by Royal
' B: K0 X+ ?( H9 z/ ?6 FLePage Real Estate Services.* I `/ \3 ?; j8 y# ? w- X: u
% g9 `' S! y7 A5 _2 Y Nationally, market trends established through the first three quarters0 F2 r& T: T% b2 s6 d D
are forecast to continue for the remainder of the year. Robust economic5 {6 ^ l- Z/ ~/ K
conditions, low unemployment rates, modestly growing salaries and wages, and
; K1 j7 J4 F$ A, X) xsound consumer confidence contributed to the overall strength of the
1 ^) \& l% y8 O e0 ~1 `# xresidential real estate sector.; b) K, z5 r# a2 S
. w) Y& ]8 F( F0 ]! @ O( `. [ Of the housing types surveyed, the highest average price appreciation
: t8 B; B4 v {; Y ~& x4 xoccurred in detached bungalows, which rose to $300,365 (+16.3%)
" q( P# R) ^9 a. p% ~: fyear-over-year, followed by standard condominiums, which rose to $211,562# i; _8 D" ` D5 g7 n
(+14.2%), and standard two-storey properties, which increased to $365,380. D9 m. R, H* Y9 J& i
(+13.2%).2 p1 N- e& T: v! [4 a ^5 I/ k
5 J+ o) S" ~% }# N5 Z
"Canada's sturdy housing market continued to demonstrate steady growth
+ Y6 d" q e- V- S1 o* Qduring the third quarter. For all but the west, we have moved on from the, R1 ^7 N) Y- E7 c
frenzied expansion that characterized the first half of this decade, and are; U9 I3 t. U0 J* o5 d! u
poised to show continued growth at a more moderate pace," said Phil Soper,2 L" l0 q0 }& S& |! e9 F: P
president and chief executive officer, Royal LePage Real Estate Services.% T" D4 Y3 C; v% R$ m0 s+ b
"Gone is the sellers' market that we have lived with for some years. We
" ^* ?! X- e# ~' p5 c* twelcome the more reliable conditions that are characteristic of a healthy
) ~$ Q$ f N. d/ j8 G/ lbalanced market."4 r3 V) g. K; u5 W o
* O$ z2 a8 N3 f( w' E Despite the double-digit rise in average national house prices, M/ n p0 b# k% q
considerable regional variances were exhibited again this quarter. The shift
2 \% ?! @: z! ~5 y. B4 lto balanced market conditions, which began in late 2005, has continued
: ?; `# T! @& Q% ^8 a+ Mthroughout most of the Central and Eastern regions of the country. In the core* o+ C. G& {* X4 n% n+ n
energy producing western provinces, the combination of very high in-migration,- B8 R3 A+ O) q- b! E% J
manageable affordability, and a shortage of inventory has driven record& `( ?9 S! _: J* T& Z# C* ^
breaking price appreciations. N% X0 j) n$ b" y4 N8 E- D
# O- h# N# {# Q% f# ^
Echoing the second quarter and supported by Alberta's rapidly expanding: T4 P; S' c9 J- [- D! P2 w
economy, Calgary and Edmonton led the charge of Canadian cities with the
7 u/ P6 @5 z$ V: T: H, W9 dlargest house price appreciation in all housing types surveyed.
/ F. J$ w+ v' G# g3 M8 C! o2 u' b1 N- b+ D; C; |+ ?' `
In Ottawa and Toronto, growth remained steady, supported by solid& r* K2 [1 [- [* U. V
economic fundamentals, an increase in available inventory and strong consumer$ d: B# Q9 S- V( D$ z
confidence. While the pace of price appreciation in Ontario leveled off% g# m! c2 C& }" a9 }2 ^- A
slightly, the province's real estate market remains poised for modest growth.
5 n2 h: ]& r2 c* Y6 iIn Atlantic Canada, new housing and condominium construction offered buyers
$ C! f+ r# P: S8 z3 n5 Ngreater selection at more competitive prices, resulting in a slower rate of
L* k# u( m* D! s Vprice appreciation when compared with 2005.
7 s3 w7 ?% o# l2 b0 @' c9 c. |
8 W* y6 q5 i! C8 a( o4 Z f w While the pace of growth in Canada has slowed, the domestic housing
; t7 n+ z- Q+ w7 k( v$ U* [0 mmarket is expected to outperform the American market. The economic and
7 ~8 O9 p" t' Z7 T* qfinancial fundamentals driving the residential real estate sector in Canada
; W( |& N5 b7 V* [are markedly different than those found in the United States.
. a- v8 E' P! Y& H0 g& M) E2 u% p$ \" ^4 f) K4 U
Added Soper: "Canada's housing market is likely to outperform the* G# V4 d$ [2 {' x; ]- b" l
American market through 2007. A number of factors are working in Canada's
- z& t' K- H0 R" e( wfavour, including healthy personal and governmental debt levels, the
1 i( P# @" O: z% X/ n2 z# T" ^7 qrelatively modest rise in interest rates in our country, and general
1 Z* g- Z& h/ o- I8 r" saffordability in our major cities. In addition, Americans are now seeing the
( o/ o7 @% u& a) [/ [ Tdownside of a tax system that encourages maximum homeowner leverage, and
" P% U5 u, d O8 j6 J4 ?( a5 waggressive financial products such as zero- and negative-amortization
: `0 c- n9 v* Vmortgages that work only in a high price growth environment.": T0 l) v" h0 O4 \) V' P; G
) I) R/ L5 z) h$ \* |6 K, S4 @
<<
1 K" [# H# I) ? M0 @ REGIONAL SUMMARIES, b) d2 F; S! X" U
>>4 C a c# e M
, v0 p* d! C: e6 A Balanced conditions continued to characterize the housing market in, F' r9 t" W* X/ P' _
Halifax, as significantly higher inventory levels helped to moderate the rate
" p9 _! c- H# f' T% u5 qof price appreciation. Buyers were increasingly choosy, taking more time
; @( A9 F& |- [+ t# @( Mlooking for newer, low-maintenance properties that were not in need of/ H- ?- j- ~: K9 k# k
renovations.
d3 W- W8 J0 f1 d
. j% P8 L* ?! n! u" m2 Y: y8 l g The housing market in Moncton remained healthy and strong as a slight
/ Z# W. n9 M( u" b5 U9 uincrease in inventory helped to moderate the rate of price appreciation
* W/ r: b8 J0 w; rcompared to the same period in 2005. Activity was brisk throughout August and
2 `3 ?9 p7 N) h/ C- ^3 ?' C# FSeptember and is expected to remain this way through the fourth quarter.: Z3 q' T2 S8 R! G5 s
) I/ [3 E( T- T: O! e4 i) q The housing market in Saint John underwent its traditional summer
$ W/ F7 U) D0 U0 \& dslowdown in the third quarter, with activity picking up towards the end of the# o6 [2 c) f, R) Q( ], Y
quarter. The local economy continued to thrive, as construction on a new( X4 }) ~* ^/ |, T/ S1 \7 _
600,000 square-foot shopping area has begun, bringing several new box stores
5 C/ U% D+ k& w) M, T( \0 ito the area. Buyers have begun seeking less expensive fixtures for their homes
% K- B( b# s" E% eand are instead opting for more affordable housing options.8 Z6 d4 M! e: h7 u! A4 f
) C/ P! Z' o) O, F( V q: K
In Charlottetown, the housing market started to move towards balanced
. r0 c: c+ r2 j! G, {$ Yconditions, as some sellers had to begin to lower the asking prices on their
- x: z6 [' U! a; Xhomes to make them more competitive. Activity from out-of-town and US buyers
. Z# G( i! C* z6 } `7 a" ?was down slightly compared to 2005, likely attributable to the strong Canadian
, T1 J$ k: p9 Y- N, B+ E, gdollar. Inventory levels began to creep up in the third quarter, providing9 P4 c3 z5 A9 e$ S' V7 B
buyers with more options when looking for a home.
0 t+ I5 V% S' g- |$ u' @9 j/ _5 z" g; ?% D
Activity in St. John's slowed slightly in the third quarter, particularly
4 C. z J' j* f( _8 k, zamong higher-priced properties, where there was a slight over-supply of homes; }' S( D8 [4 N
priced over $200,000. Listing periods have increased when compared with 2005,
2 u! M# ]" R' h6 Ias some of the pent-up demand that had characterized the market over the last
0 E, } b5 J) W& i- d, m( P) e7 Mfew years has been satisfied, resulting in more normal, balanced conditions.
0 O7 Y+ k" |$ f# ~
; c4 ]$ }, p* g# a8 v Montreal's housing market recorded modest increases in average house) F) L1 @; Z( L) Y8 ~& z8 L; p
prices, due to a slight seasonal slowdown in the third quarter as inventory
8 C/ B& X: N" n/ V* Nlevels rose. Part of this can be attributed to the fact that many renting
/ G5 B' D8 o3 N4 gfirst-time buyers were motivated to close on the purchase of a home by July 1,
3 k) K4 {, U& G V& u2 k, ~- c; Bwhen rental leases expire in Quebec. Once this date has passed some of the! c! r2 U3 u" n+ u! ?
pressure is taken off the market, allowing buyers to visit more homes before
# b; ]8 [; n6 k$ m ymaking a purchase.
* L a, b& C' y% E% D" n4 @! l' S c
Ottawa held its position as one of the country's most stable housing
% A# Q, U; D+ t3 Imarkets in the third quarter, reinforced by a vibrant local economy and strong
5 P u$ K! x( {$ F# n- rconfidence, resulting in modest increases in average house prices. The city
6 `6 d" ]& }( m' wcentre remained a bright spot in Ottawa, with homes in this area attracting6 g4 V; ~+ } G7 v1 j5 J4 `
attention due to their convenient location and proximity to downtown# V w- }7 R3 M/ ]5 A
amenities.+ U, i- C. X: u5 A6 a1 v* U& z
( Q& J/ ?3 Z) x- l% @
The housing market in Toronto sustained healthy activity levels- N6 M" l( b2 g# E( P+ ?
throughout the third quarter, as a strong economy helped to maintain demand
& A( ^$ K8 z5 J1 y. nacross the city, causing average house prices to rise moderately. Toronto has) R; o6 Z* S @* M, ^' C
continued to experience modest growth in average house prices, and has been- a% c! ~# Q8 P: E! a
driven primarily by purchasers who are buying homes as their principle
: l' h4 Q1 ~; z& E- x. B3 b, J5 {residence, rather than for investment./ B4 U) ~; y; D9 }. H
9 ?- [* S- D! z% @6 l
The vibrant Winnipeg housing market continued to show its strength as
6 K' L$ V2 n: N, X: zhouse prices rose during the third quarter. The booming local economy resulted3 v, e j* Z3 W8 @- u2 h
in a historically low unemployment rate, helping to bolster consumer1 d# n7 B9 x* K7 q
confidence and Winnipeg's ranking as the city with the lowest capitalization
e0 ]( z9 g9 b" B/ E) e' arate among the country's larger cities - helped to encourage buyers to enter6 W( Y7 ~" B! z8 Q3 Y
the market.% v+ [, |) E' l$ g" \
5 T( o* B/ z# ]- C In Regina, the market experienced a slight seasonal slowdown through' k Y* b6 b7 j0 I0 y: Z0 K
July, as there were fewer purchasers in the market due to summer vacations. In4 X' g3 R. |* A* _
August, activity resumed to the busy pace previously seen in the spring- [$ t. \0 b {
months, as the influx of purchasers made it more difficult to find a home due- P+ P* i6 @% r& b: a/ C5 D u! k
to the shortage of available inventory.
1 `3 e# o6 A% M7 N0 C( C+ n/ k$ }& ?8 x. a4 N; v) \
Activity in Saskatoon remained brisk as the market maintained its' a. r8 h) p# C) [0 t' d: \9 ^
momentum from the busy spring sales period. The economy in Saskatoon remains$ N/ O) J- T. j4 H) w% M% q8 P
vibrant, as employment opportunities are abundant with many businesses: i3 y% l% m0 k/ {
struggling to make hires and having to recruit outside the province.( C5 ]5 }' l y8 Q% ?9 K+ M) b/ }
" R% w& L* a; ^5 L' K5 g) y0 a3 W Calgary's housing market recorded blazing average house price increases
1 m+ W0 f( m3 g' oin the third quarter, in all surveyed categories. The burgeoning economy, low/ [* p6 [" Z* W
unemployment rates and low inventory levels remained the leading factors that
6 X! v6 Q& D5 z' t9 Tpressured Calgary's house prices upwards. However, regardless of the soaring+ o7 f5 R; Q8 T5 l. i! k
prices that characterized the market - even during the typically slower summer6 a- J4 {- [( b% b0 l2 o( h
season - it is expected that activity will become slightly more balanced, as
5 A, u! \! |7 q- e6 A0 M* |buyers are becoming more reluctant to participate in the frenetic activity.
7 ^: L5 {) S. M
3 H7 e1 r- T; T Edmonton's booming local economy continued to thrive in the third quarter4 v" P S' B2 a. \5 Z2 m
as activity in the oil sands north of the city continued to flourish. Edmonton( k/ s* Y' r2 c2 Y1 G1 U9 ?! `
remained the hub of activity for those coming to work in the oil industry,0 h# C3 l; j+ a% Y- x/ f
maintaining tight inventory levels across the city, resulting in prices
9 I+ L( U( u/ F# Rincreasing at record levels. However, as inventory levels continued to improve7 a7 @, {: p: e1 C
in the third quarter the rate of price appreciation should moderate slightly4 u! ?: ?% I4 f: l& y* K6 o) i" q
towards the end of 2006. : }' t% B0 R$ z
4 s! Y* f2 Y# E! Y# c
While Vancouver has seen a slight reprieve from the severe shortage of
8 t9 n0 x% ^% [: z, {inventory that had previously characterized the market, supply is still unable
% J! ?* l* I1 l3 p/ ^5 eto meet demand, driving house prices upwards. Vancouver has a very diverse
' u' T- m% [% V1 q3 y" X) }group of active buyers - from first-time home buyers to baby-boomers to6 P$ b/ K6 R1 e
foreign investors - all of whom fuel the demand for houses, placing added1 ^: l& O! m0 f. _7 v
pressure on tight inventory levels.1 \+ C; z, v- f* y! u
; H0 R: @2 O$ D+ s8 g
Victoria's market is vibrant and supported by strong economic
8 I% Z2 \5 c9 U+ o$ D$ z, Wfundamentals, fuelled by a booming tech sector and a migration of young people3 u' H+ v& C6 m: R7 w8 ]) r
into the city that has continued to support the area's house price increases;
1 L$ y, \! _; h( r8 S7 {while increased inventory levels have afforded buyers more time when searching
' w/ J K' t1 rfor a home, helping to normalize the market's pace.* ^% N& J- @6 d; ?" @0 F
" @: h1 R' D" Z4 e8 i9 l0 @ <<
* S% S" @0 J6 x Survey of Canadian Average House Prices in the Third Quarter 20067 j% v. g1 P7 c2 A4 t4 W& h+ |' p+ _
0 V: V, H8 u1 s8 K6 D! n9 \
------------------------------------------------------------------------- N* z1 F g# \5 M3 V1 i
Detached Bungalows Standard Two Storey5 w! X, C! p+ R$ U" x
-------------------------------------------------------------------------# S7 ~; O9 X3 b9 { B. R/ x
2006 Q3 2005 Q3 Bungalow 2006 Q3 2005 Q3+ J4 c5 G B6 |% t9 |
Market Average Average % Change Average Average$ z8 n5 D5 t' D! i1 p6 p/ ]1 D
-------------------------------------------------------------------------( x5 R! E4 Z8 t" l1 F2 W4 R
Halifax 186,333 173,333 7.5% 198,667 199,000
- n0 \( l4 f( B: b4 T; x+ M' d -------------------------------------------------------------------------& `1 i( H: d0 s& ]! ~" c, k0 Y
Charlottetown 145,000 141,000 2.8% 175,000 170,000
% \# M% H. s2 y3 E: w -------------------------------------------------------------------------, r5 W( L$ U: T* u5 R
Moncton 135,000 127,000 6.3% 129,000 123,000/ j8 ~) w% v$ b0 |1 H7 T
-------------------------------------------------------------------------
; F& d9 q- Y% d6 ?# ^ q! g: ? Saint John 141,200 142,900 -1.2% - -0 ?2 M$ O% ^ r& S7 ^1 ^5 E
-------------------------------------------------------------------------- Z4 l& Z. o( H- M! P" g
St. John's 143,667 142,667 0.7% 200,667 202,333
7 F" \1 ]3 t( I% J -------------------------------------------------------------------------
/ Z3 X9 \; W# M8 B. F' M Atlantic 150,240 145,380 3.3% 175,833 173,583
: _7 n9 p" a. Q) Z4 d1 V -------------------------------------------------------------------------
& [; C7 H. J; E6 `. W: a Montreal 213,691 203,500 5.0% 321,141 316,185, S+ {$ r' K2 `1 \ R1 |
-------------------------------------------------------------------------# O A7 U4 {4 y! F
Ottawa 290,083 278,417 4.2% 285,667 273,250- e. _+ p7 w1 x4 V% |( E: f
-------------------------------------------------------------------------
. t, n L1 ]8 x Toronto 373,368 355,882 4.9% 481,523 474,766
; t+ A; d2 F$ P" c& ]9 u# n -------------------------------------------------------------------------( M# j9 L, t5 v, S+ v$ z
Winnipeg 181,579 159,860 13.6% 202,337 180,707( c7 F, Z3 o: v
-------------------------------------------------------------------------
: e+ W' ]/ z8 C) a% s Saskatchewan 170,667 156,083 9.3% 182,600 166,5000 l: K: K0 E0 I/ Q
-------------------------------------------------------------------------+ `: j( |1 S. Q2 q
Calgary 395,067 252,411 56.5% 405,778 264,3893 T. B( u: G6 H) P) S/ m
-------------------------------------------------------------------------
Q5 x- X6 y% ^' w1 y2 q4 `1 i Edmonton 286,857 194,857 47.2% 316,429 206,714
' K: ?6 D& d5 K5 v3 f% s2 s4 O- {* ] -------------------------------------------------------------------------
3 N$ |3 [3 P* S+ z- |, a Vancouver 704,250 601,000 17.2% 794,000 697,500
) k: q& A9 e& _$ U -------------------------------------------------------------------------& n6 T6 ^( N5 x& v/ v4 h+ N
Victoria 375,000 348,000 7.8% 403,000 391,000
, B& }2 i. ^& S2 K; Z+ ?+ O -------------------------------------------------------------------------; A% s) }- E( K. e* r
National 300,365 258,202 16.3% 365,380 322,860
, g" f2 U" x3 Z -------------------------------------------------------------------------0 }8 n" h# J/ |4 X1 a4 g) A
" l2 ~# W* ?/ I% E# ?
-------------------------------------------------------------
9 G" O+ g9 `% z! _" j2 S5 \ Standard Condominium
+ \1 I, j! w { -------------------------------------------------------------
5 P. M4 M+ \; X 2-Storey 2006 Q3 2005 Q3 Condo! _6 O, b: s0 H4 X" K- R1 R
Market % Change Average Average % Change+ M' x, O7 n4 @, E
-------------------------------------------------------------
/ w" p& Z% R2 k+ w1 I Halifax -0.2% 142,000 103,000 37.9%3 S u) ]4 l! D8 r, s0 a
-------------------------------------------------------------( z/ d6 X& X9 N) [9 D6 x+ D6 S9 V
Charlottetown 2.9% 98,000 98,000 0.0%2 }& |7 B" W1 V# ~# Q
-------------------------------------------------------------
. u6 {! c" z& X. @8 B4 N, ^ Moncton 4.9% - - N/A# a! ]6 z/ z h4 ~3 M
-------------------------------------------------------------
" Y- R1 ~: [ O& J/ P; I Saint John N/A - - N/A7 M4 m3 |, w5 h8 B" l. B; _% O
-------------------------------------------------------------0 `, D |* t( i& `# m7 H( B6 B
St. John's -0.8% 146,333 145,667 0.5%3 v) z* \1 [' v5 v
-------------------------------------------------------------
2 ]; {1 l& P& D$ d! m3 C Atlantic 1.3% 128,778 115,556 11.4%
; Z( P* Q1 b$ @! X -------------------------------------------------------------
1 N" K3 V7 P! q- E' K Montreal 1.6% 193,190 188,016 2.8%( k4 {/ Z2 l" I, c2 [0 P3 v
-------------------------------------------------------------3 F$ N( }; E6 n" |# j- j
Ottawa 4.5% 181,083 172,250 5.1%: g! J% b3 z5 A/ `1 _
-------------------------------------------------------------/ E# N u& ?1 l. V+ R/ W; l4 D/ p
Toronto 1.4% 252,088 242,918 3.8%' c0 G# _6 O& L6 l
-------------------------------------------------------------
1 x- a$ b0 U- e) ? Winnipeg 12.0% 105,648 96,008 10.0%( l/ `7 `/ z- s& v o9 A/ ^
-------------------------------------------------------------/ x% [0 C# ?/ M; G
Saskatchewan 9.7% 106,250 101,000 5.2%$ u$ A+ N1 M3 y' Y+ Q- R6 u
-------------------------------------------------------------
! K ^1 Y4 j, M: n Calgary 53.5% 245,844 153,867 59.8%
# ^7 W& n1 T D* e# ] -------------------------------------------------------------
_2 ^( K: Q) u6 r Edmonton 53.1% 200,433 131,500 52.4%1 @* a8 n3 u- f9 G4 I
-------------------------------------------------------------" f7 a0 e4 v. |! v3 C3 w+ O
Vancouver 13.8% 366,250 323,250 13.3%
8 z S A7 s- e7 R( [( [7 d6 W9 D: @ -------------------------------------------------------------* C, J1 @/ z9 W y' ?; R6 s
Victoria 3.1% 229,000 220,000 4.1%
" _4 J: G6 p- [8 T3 s -------------------------------------------------------------
5 g }( P1 ^5 C National 13.2% 211,562 185,296 14.2%
9 p/ h" S! F* x ]( @ -------------------------------------------------------------
a8 T+ y/ R+ f >>: [9 `0 P3 w9 r# d7 f- ? L
' z7 m5 g2 p. g
Average house prices are based on an average of all sub-markets examined# ~6 P* S% d7 ], m9 p/ g
in the area, except for the smaller markets of Charlottetown, Moncton, Saint
u& X7 j* V4 ?6 q7 ]* mJohn and Victoria.
/ L( n) P8 u* c9 [# `. F4 b
9 b" m, L0 y4 U/ \ @; n3 D& w The Royal LePage Survey of Canadian House Prices is the largest, most5 U9 O/ J K0 k, r! L. T
comprehensive study of its kind in Canada, with information on seven types of: g& N4 v/ k! o# C/ `% X
housing in over 250 neighbourhoods from coast to coast. This release
/ ^0 r% B/ }' ~5 b- o: Nreferences an abbreviated version of the survey, which highlights house price
2 f0 L i- _! W+ u+ I4 r! Q0 vtrends for the three most common types of housing in Canada in 80 communities
" x5 b, v" Z" r8 M$ @across the country. A complete database of past and present surveys is
% N, _& U. ~, Y0 T; @available on the Royal LePage Web site at www.royallepage.ca, and current) T2 q; t* x+ e. e' D- S- M$ q
figures will be updated following the end of the third quarter. A printable
5 ~6 R& U1 x8 ^/ Y' xversion of the third quarter 2006 survey will be available online on
* ?4 C/ i) _7 ~$ g5 S, uNovember 15, 2006.
7 D2 a- A* \+ n; | Housing values in the Royal LePage Survey are Royal LePage opinions of
2 u/ O; C$ ^1 v4 S6 e) Ufair market value in each location, based on local data and market knowledge
4 z1 K; q! {+ ]8 u' M" |provided by Royal LePage residential real estate experts. Historical data is# K1 c: w# X# c" L
available for some areas back to the early 1970s. |
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