Comparison of Real Estate Prices Across Cities in South Korea

Published on and written by Cyril Jarnias

South Korea’s housing market has become one of the most contrasted in the developed world. With an overheating capital, declining regional metropolises, and intermediate cities struggling to keep up, the concept of a “national market” has almost lost its meaning. The figures reveal an unprecedented gap between large and small cities, to the point that the OECD ranks South Korea as the member country with the most pronounced price disparity between major urban centers and secondary cities.

Good to know:

This article compares prices, rents, rental yields, transaction volumes, and supply dynamics between South Korea’s major cities. It aims to quantify and explain the gaps, particularly between Seoul and Busan, to understand the scale, location, and causes of this polarization.

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A Highly Polarized National Market

The starting point lies in rather misleading national indicators. Officially, the national housing price index rose 0.31% year-on-year in February 2025. Adjusted for inflation, however, this equates to a real decline of 1.67%. The country has just emerged from a mini-crash following the 2020-2021 surge (+5.43% then +9.87% nominally) and two years of correction (–4.68% in 2022, –3.51% in 2023).

0.5

Expected national decline in South Korean real estate prices for 2025, despite increases in Seoul.

The key statistic that summarizes this divide is the average price per square meter.

Average Prices per Square Meter: Seoul vs. the Rest of the Country

In February 2025, the national average price for a new apartment was around 5.763 million won per square meter, or approximately $3,989. Seoul’s price sits more than 2.3 times above this level.

Area / CityAverage Sale Price (KRW/m²)Average Price (USD/m²)Annual Price Index Change
National Average5,763,0003,989+0.31%
Metropolitan Area (Seoul + Incheon + Gyeonggi)8,531,0005,905+1.68%
Seoul13,396,0009,272+3.63%
Incheon5,644,0003,906+0.63%
Gyeonggi6,554,0004,536+0.32%
Other Metropolises + Sejong (Combined)5,922,0004,099–1.41%
Busan6,690,0004,630–1.94%
Daegu6,713,0004,646–3.87%
Gwangju6,003,0004,155–1.13%
Daejeon5,366,0003,714–1.07%
Ulsan5,334,0003,692–0.11%
Sejong5,425,0003,755–5.06%
Other Regional Cities4,605,0003,187–0.30%

The gap is particularly striking: the price of one square meter in Seoul can buy almost three square meters in some regional cities. The OECD rightly points out that South Korea holds the record for the price gap between large metropolises and small towns among its members.

Seoul: A Market Apart in South Korea

Seoul is not only the political and economic capital, but also the heart of the residential market. The city alone accounts for about 41% of the national residential real estate market’s value. The metropolitan area (Seoul, Incheon, Gyeonggi) covers less than 12% of the territory but nearly half of the population and 47% of the housing stock.

In this context, Seoul’s real estate market functions almost autonomously.

Price Levels and Purchasing Power

The raw figures are enough to grasp the phenomenon. The average sale price of an apartment exceeds 1.13 billion won, with a square meter costing about 13.4 million won. The average single-family home nears 1.14 billion won. In December 2024, the average purchase price for a home in Seoul was around 866 million won, while some elite neighborhoods far exceed this amount.

In the Gangnam district, a symbol of real estate wealth, the average price for apartments of “standard national size” reaches about 2.38 billion won, more than triple the price in some districts in northern Seoul. Within the capital itself, the indicators reveal internal polarization:

27

The price-to-income ratio reaches 27 in Seoul, a very high level by international standards.

A study of Kookmin Bank data, reported by Bloomberg, illustrates this trend: the average apartment rose from about $500,000 (600 million won) to $770,000 (925 million won) in three years, a rise of more than 50%.

Rents, Jeonse Deposits, and Cost of Living

This overheating is also reflected in the rental market. The Korean system largely relies on jeonse, a massive deposit (often 50 to 80% of the property’s value) instead of monthly rent, although this model is declining in favor of the classic monthly payment system (wolse).

In March 2025, the average amounts in Seoul are unequivocal.

Indicator (Seoul)Average Level (KRW)USD Equivalent (approx.)
Long-term deposit (jeonse)444,800,000305,000
Average deposit for monthly lease145,600,00099,800
Average monthly rent (wolse)1,122,000770
1-bed rent city center (other source)1,075,000833
Monthly public transit pass45,40045.4
Average monthly groceries659,000512
Average monthly net salary3,308,0002,570

The Integrated Rent Index is rising by 2.7% per year in the capital, above the national average. Meanwhile, wages, even relatively high ones, are not following the same trajectory: according to cost-of-living comparisons, an average after-tax salary covers about 1.4 months of expenses in Seoul, compared to 2.3 months in Busan.

Rental Yields and Investment

Despite these stratospheric prices, the average gross rental yield for apartments reached 4.31% in April 2025, in line with the national average. But this figure masks significant nuances:

– studios and small apartments can offer nearly 6.6% gross yield;

– large four-bedroom units fall to around 2.65%.

Good to know:

In Seoul, rental yields vary by neighborhood. Prestigious districts like Gangnam offer modest yields (3-4%) due to very high purchase prices. Conversely, areas like Mapo or Yongsan, popular with young professionals and expatriates, can present more attractive yields.

Explosion in High-End Transactions

Data on the “Gangnam 3” districts (Gangnam, Seocho, Songpa) and Yongsan show a dynamic specific to the ultra-high-end segment. While government measures meant to curb speculation caused the number of transactions across Seoul to plunge by more than 79%, sales in these districts increased by nearly 70% over the same period. Prices there regularly set new records, with apartments exceeding 3 billion won for areas around 59 to 84 m².

This resilience of premium neighborhoods is one of the markers of internal polarization within Seoul, but also of the growing gap with the rest of the country.

Busan, Daegu, Gwangju, Daejeon, Ulsan: Decoupled Metropolises

While Seoul continues its upward trajectory, most large regional cities are experiencing the opposite: falling prices, loss of working-age population, excess supply, and sometimes pressured rental yields.

Busan: The Port City Capital in Correction

Busan, the country’s second-largest city, is home to nearly 3.4 million people and plays a major role thanks to its port, beaches, and tourism. In real estate terms, however, the city is going through a phase of marked correction.

The average price per square meter reaches about 6.69 million won ($4,630), half that of Seoul. Over ten years, the increase remains significant (+51.4% between 2015 and 2025), but it is far from the +148.5% observed in Seoul over the same period. The gap between the two cities has thus widened from 2.1 times to 3.5 times for the average price per pyeong (3.3 m²).

For an 84 m² apartment, the difference is stark:

CityAverage Price 84 m² (2015)Average Price 84 m² (2025)Increase over 10 years
Seoul594.87 M KRW1,478.47 M KRW+148.5%
Busan279.00 M KRW422.32 M KRW+51.4%

Since the peak of 2022-2023, Busan has entered a downward cycle: approximately –5% in 2024, then another –1.9% year-on-year by mid‑2025. The average apartment has fallen back to around 12.14 million won per pyeong, after reaching 23.56 million at the cycle’s peak. The market has clearly shifted in favor of buyers, with over 4,700 unsold new homes in spring 2025, nearly five times more than in Seoul.

Good to know:

Compared to Seoul, Busan offers significantly more affordable rents, making it an interesting option for residents looking to reduce their housing costs.

Indicator (Busan)Average Level (KRW)USD Equivalent
Long-term deposit (jeonse)176,900,000121,300
Average deposit for monthly lease36,500,00025,000
Average monthly rent (wolse)613,000420
1-bed rent city center (other source)516,000422
Average monthly groceries584,000454
Average monthly net salary2,445,0001,900

The overall cost of living is estimated to be about 20% lower than in Seoul, and housing expenses nearly 37% less. For an investor, Busan offers advertised yields between 3% and 5%, with coastal neighborhoods like Haeundae or Marine City still highly sought after, especially for seasonal rentals driven by tourism.

Daegu: Falling Prices but Catch-Up Potential

The country’s fourth-largest city, Daegu illustrates another facet of the regional market. The average price per square meter is around 6.713 million won ($4,646). The price index fell by 3.87% year-on-year in February 2025, after a drop of about 3.9% in 2024. In the short term, the market has deteriorated significantly, mainly due to oversupply and the departure of some young people to Seoul or other major hubs.

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Prices in Incheon are about 25% lower than in Seoul, offering an attractive cost of living.

Indicator (Daegu)Average Level (KRW)USD Equivalent
Long-term deposit (jeonse)184,600,000126,600
Average deposit for monthly lease24,400,00016,700
Average monthly rent (wolse)751,000515
1-bed rent city center (USD, other source)≈ 332,000 KRW332

The gross rental yield oscillates between 1% and 1.6% according to data from one operator, slightly below national averages, but the rental market is considered structurally more solid than the sales market. Some forecasts suggest a possible recovery, with 3 to 5% annual growth in the medium term, driven by infrastructure projects (metro extensions, international airport expansion) and economic diversification (health, technology, renewable energy).

Gwangju, Daejeon, Ulsan, Sejong: A Common Downtrend

The other major metropolises follow a similar pattern, although the intensity varies:

Real Estate Prices in Major Korean Cities

Overview of prices per square meter, index changes, and average rents in four major South Korean cities.

Gwangju

Avg. price: 6.003 million won/m². Price index decline: 1.13%. Avg. monthly rent: 602,000 won.

Daejeon

Avg. price: 5.366 million won/m². Price index decline: 1.07%. Avg. monthly rent: 701,000 won. Nicknamed the Korean ‘Silicon Valley’.

Ulsan

Avg. price: 5.334 million won/m². Price index nearly stable: -0.11%. Avg. monthly rent: 677,000 won. Industrial city (petrochemicals, automobiles).

Sejong

Avg. price: 5.425 million won/m². Price index collapse: -5.06%. High avg. monthly rent: 845,000 won, despite a 2.3% decline in the rent index. Recent administrative capital.

Most of these markets experienced moderate or no growth while Seoul soared. Today, they are undergoing downward adjustments as capital, jobs, and demographics become even more concentrated in the metropolitan area.

The Metropolitan Area: Between Overheating and Overflow

If Seoul forms the apex of the pyramid, its surrounding areas, Incheon and Gyeonggi Province, play a dual role. They serve both as a more affordable entry-level market for households priced out of the capital and as a growth relay for investors seeking more reasonable entry prices.

Incheon: Strong Rent Increases, Still Affordable Prices

In Incheon, a port city integrated into the metropolitan area, the average price per square meter remains significantly below the capital’s (5.644 million won). The price index is rising modestly (+0.63%), but the most visible dynamic is in the rental market.

Important:

In March 2025, the integrated rent index surged by 3.8% in the region, recording the strongest increase of all South Korean regions. The data confirms this tension in the market.

Indicator (Incheon)Average Level (KRW)USD Equivalent
Long-term deposit (jeonse)194,200,000133,200
Average deposit for monthly lease28,700,00019,700
Average monthly rent (wolse)807,000553

With lower purchase prices than Seoul but rents appreciating rapidly, Incheon is becoming a preferred target for rental investors, especially as it captures 10% of the housing stock owned by foreigners in the capital region.

Gyeonggi: Seoul’s Residential Belt

Gyeonggi Province, surrounding Seoul, offers a price/accessibility compromise. The average square meter trades at 6.554 million won, about half the level of Gangnam but with potential daily access to the capital’s center. The price index there is rising by 0.32%, and the rent index by 2.1%.

Indicator (Gyeonggi)Average Level (KRW)USD Equivalent
Long-term deposit (jeonse)281,800,000193,200
Average deposit for monthly lease60,200,00041,300
Average monthly rent (wolse)946,000649

Gyeonggi alone concentrates 36% of the homes owned by foreigners in Korea, ahead of Seoul (23%) and Incheon (10%). The province saw the number of transactions jump by 22.8% in 2024, while housing starts increased by over 42%. This dynamism, stimulated by large new town and infrastructure projects, further reinforces the concentration of demand in Greater Seoul to the detriment of regional cities.

National Rental Overview: Supply, Deposits, and Regional Gaps

Comparing sale prices is not enough. In South Korea, where 42% of households are renters (2019 figure), the structure of rents and deposits is crucial to understanding imbalances.

Jeonse Deposits and Monthly Rents by Region

March 2025 figures show a very clear geography of rental costs.

Region / CityAverage Jeonse (KRW)Average Wolse (KRW/month)Annual Rent Trend
National Average231,800,000778,000+1.20% (overall index)
Seoul444,800,0001,122,000+2.7%
Gyeonggi281,800,000946,000+2.1%
Incheon194,200,000807,000+3.8%
Busan176,900,000613,000+0.6%
Daegu184,600,000751,000–2.5%
Gwangju176,700,000602,000+0.5%
Daejeon203,200,000701,000–0.5%
Ulsan187,800,000677,000+1.8%
Sejong213,000,000845,000–2.3%
Gangwon115,100,000526,000n.a.
Jeju153,500,000686,000–1.4%

First conclusion: Seoul and Gyeonggi dominate not only in sale prices but also in rent and deposit levels. Even in Busan or Daegu, though major cities, deposits remain far lower than in the capital.

Good to know:

In some South Korean cities with declining prices (like Daegu, Daejeon, Sejong, and some provinces), rents tend to fall, indicating weakening rental demand. Conversely, rents are rising faster than the national average in Incheon and the capital region, reflecting stronger demand.

Transformation of the Jeonse System

In the background, the Korean rental model is evolving. Jeonse now accounts for only about 30% of the market, its share declining in favor of monthly rents. The 2022 jeonse fraud crisis accelerated this shift: the rent-free but huge-deposit formula no longer appears as a safe investment for owners or a risk-free solution for households.

This rise of wolse is attracting new players: investment banks, pension funds, large real estate companies, which see monthly rental streams as a more predictable and “financializable” asset. Again, capital is concentrating primarily on Seoul and its region.

Transactions, Construction, and Relative Supply Shortage

Another angle for city comparison: sales volumes and construction dynamics. In 2024, Korea recorded 642,576 housing transactions, an increase of 15.77% compared to 2023. This figure, however, remains 22.8% below the average of the previous five years and nearly 50% below the 2020 peak.

The Capital Region Leads the Recovery

Again, the metropolitan area dominates:

AreaTransactions 2024Annual Change
Capital Region (total)305,988+27.02%
– Seoul93,418+45.15%
– Incheon42,943+11.80%
– Gyeonggi169,627+22.80%
Other Metropolises116,097+8.95%
Regional Cities214,611+6.25%
Entire Country642,576+15.77%

Seoul, long paralyzed by rising interest rates and credit restrictions, is clearly rebounding in sales numbers, especially in the high-end segments. Other metropolises are also progressing, but much more timidly.

Insufficient Supply Despite a Rebound in Housing Starts

Meanwhile, housing production is struggling to keep up with demand, especially in the capital region. In 2024, the country completed 449,835 homes (+3.16%) and started 305,331 construction projects (+26.07%), largely thanks to the public sector.

500000

The government anticipates a cumulative housing deficit by the end of 2025.

– In the capital region, completions fell by 12.6% in 2024, even though starts surged by 36.39% driven by public programs;

– In the provinces, completions rose sharply (+17.83% in other metropolises, +23.53% in regional cities), as did starts.

Problem: private construction remains cautious, hampered by tighter credit rules (strengthening of the Debt Service Ratio, DSR, in 2024) and less supportive demand outside the metropolitan area. The Korea Housing Market Institute even anticipates a 30% decline in residential construction activity in 2025 compared to the historical average.

Busan vs. Seoul: Detailed Housing Cost Comparison

To concretely measure the gaps between cities, the Busan–Seoul comparison is particularly telling, as these two markets play very different roles.

Cost of living and housing data indicate that a household needs about 8.81 million won in Seoul to maintain the same standard of living as 7.01 million won in Busan. The housing category explains a large part of this difference.

Some examples of compared prices:

Type of Property or IndicatorSeoul (KRW)Busan (KRW)Seoul vs. Busan Gap
1-bed rent city center (month)≈ 1,288,700≈ 691,700+86.3%
1-bed rent outside center (month)≈ 790,400≈ 433,300+82.4%
3-bed rent city center (month)≈ 3,497,500≈ 1,370,000+155.3%
3-bed rent outside center (month)≈ 1,887,800≈ 900,000+109.8%
Purchase price m² city center (approx. per ft²)≈ 2,716,400≈ 1,151,200+136.0%
Purchase price m² outside center (approx. per ft²)≈ 1,524,600≈ 912,800+67.0%
Average monthly net salary≈ 4,329,600≈ 3,244,000+33.5%

Higher incomes in Seoul only partially offset the higher housing cost. This results in much stronger financial pressure on households in the capital and a relative attractiveness of Busan for those who can afford geographical distance.

Example:

For an investor, the analysis is dual: it involves analyzing both the financial data (accounts, ratios) and the qualitative elements (strategy, management, market context) of a company to make an informed decision.

– Seoul offers stronger capital gains potential, structurally tight demand, and high liquidity, at the cost of a colossal entry ticket and sometimes modest current yields in the most expensive districts.

– Busan offers more accessible purchase prices, often comparable or slightly higher yields, but in a context of price stagnation or decline, with increased risk in some oversupplied segments.

Jeju, Incheon, Small and Medium Cities: The Other Gaps

Beyond the major market names, several cities and regions illustrate the geographical fragmentation of prices in their own way.

Jeju: Between Tourism, Foreign Investors, and Adjustment

The island of Jeju, an autonomous province and major tourist destination, has prices per square meter in the city center around $7,500, an intermediate level between Seoul and Busan. Jeju’s specificity lies in the influx of foreign investors, particularly Chinese, attracted by visa schemes linked to property purchase and a highly valued natural setting.

Tip:

Strong purchase demand from foreign investors, especially under immigration programs, led to a 40% increase in land prices between 2012 and 2016, with some buyers paying up to three or four times the market price. To curb this speculation, the province increased taxes on these purchases, significantly reducing this flow. Meanwhile, in the rental market, the rent index fell by 1.4% year-on-year, although average amounts remain high, with an average jeonse deposit of 153.5 million won and an average monthly rent of 686,000 won.

Small Towns and Provinces: Lower Prices, but Oversupply Risks

In provinces like Gangwon, Jeonbuk, Jeonnam, or Gyeongbuk, average sale prices often hover around 4 to 5 million won/m², sometimes less. Jeonse deposits are well below the national average (often between 90 and 135 million won) and monthly rents are below 500,000 won.

Important:

Despite affordable entry prices, demographic studies predict rapid aging and a decline in the working-age population, which could lead to an excess of housing in some less urbanized regions. Econometric models anticipate price declines of up to 20% by 2030 and a vacancy rate of 13% of the housing stock by 2050.

For investors, these regional cities thus offer low entry tickets and sometimes decent gross yields, but with long-term structural risk linked to demographics.

The Role of Policy and Credit in Price Gaps

Price differences between cities are not explained solely by the local economy, but also by public policies and financial conditions.

Monetary Policy and Mortgage Credit

After a cycle of interest rate hikes aimed at curbing soaring prices and household debt, the Bank of Korea lowered its key rate to 2.75% in spring 2025 (–75 basis points cumulative). Despite this easing, rates for new mortgages remain high, around 4.23% on average, due to tighter regulations (stricter DSR ratios, limitations for multi-property owners, etc.).

1123900000000000

The mortgage loan stock reached 1,123.9 trillion won at the end of 2024, up 5.6% year-on-year, and represents over 62% of total household debt.

Policies Targeting “Speculation Zones”

To counter speculation, several successive governments have classified Seoul, Incheon, Gyeonggi, and specific neighborhoods (Gangnam, Seocho, Songpa, Yongsan) as “speculative overheating zones” or “land transaction permission zones.” In these zones:

Good to know:

Real estate loan ceilings are reduced, limiting, for example, the maximum mortgage amount for properties over 1.5 or 2.5 billion won. Furthermore, the buyer sometimes must commit to residing in the property, which complicates classic investment purchases with a tenant in place, especially under the jeonse system.

However, these measures have an ambivalent effect. Several analysts point out that they mainly restrain ordinary households without really affecting the ultra-rich, who buy in cash. Result: transactions decline in most neighborhoods but hold steady or even increase in the most high-end sectors, which then create a ripple effect on neighboring prices.

Conversely, in regional cities, the combination of these national policies and a less supportive local climate (local economy, demographics, oversupply) translates more into a decline in prices and a rise in unsold inventory.

A National Market Reconfiguring in Favor of the Capital Region

Putting all these elements together, the South Korean real estate map reveals a strong trend: an increasing concentration of value, transactions, and investment in the Seoul metropolitan area, to the detriment of other cities.

A few indicators summarize this reconfiguration:

Real Estate Dynamics in South Korea

Focus on recent real estate market trends, marked by strong concentration and a vigorous recovery in the capital region.

Concentration of Foreign Purchases

Approximately 69% of homes owned by foreigners are located in the capital region.

Transaction Rebound in 2024

The capital region recorded a 27% increase in transactions, compared to only +6% to +9% in other parts of the country.

Rising Rents and Deposits

Rents and security deposits are rising faster, particularly in Incheon and Seoul.

Rebound in Building Permits

Building permits are up 11.7% in the capital region, while declining in other metropolises (-12.7%) and regional cities (-10.8%).

In contrast, many regional metropolises – Busan, Daegu, Daejeon, Gwangju, Sejong – are seeing their prices flatten or fall, their rents stagnate, and their unsold inventory climb. All against a backdrop of economic slowdown and accelerated aging.

What Does This Polarization Mean for Buyers and Investors?

For a South Korean household, the reading is brutal: becoming a homeowner in Seoul, especially in the best-connected or most coveted neighborhoods, is out of reach for the majority, especially for young families. Many turn to the periphery (Gyeonggi, Incheon) or to regional cities where prices remain accessible, at the cost of a compromise on salaries, services, and often career prospects.

For an investor, whether local or foreign, the question is more one of risk/return trade-off:

Tip:

Real estate investment in South Korea presents several risk and return profiles depending on location. Investing in **Seoul and its region** offers a higher probability of long-term capital gains, supported by the concentration of jobs and infrastructure, despite sometimes modest current yields. Targeting major cities like **Busan, Daegu, Gwangju, Daejeon, or Ulsan** allows for lower entry prices and sometimes decent gross yields, but with increased uncertainty linked to demographics and local markets. Finally, special markets like **Jeju Island** or new international districts (e.g., Songdo in Incheon) can offer higher rental yields, especially through tourism, but come with potentially higher volatility.

In any case, the simple national average price no longer says anything about the South Korean reality. “Comparing real estate prices between cities in South Korea” today amounts to comparing almost two different countries: the dynamic, expensive, and over-solicited Seoul metropolitan area on one side, and an archipelago of regional cities on the other, where real estate oscillates between bargain opportunity and the risk of prolonged stagnation.

Good to know:

In the coming years, the evolution of the real estate gap will depend on four key factors: population aging, credit access conditions, public construction policies, and the ability of some cities to reinvent themselves economically. These elements will determine whether this gap stabilizes, narrows slightly, or continues to widen.

Why you should contact me? Here is a concrete example:

A French entrepreneur, around 50 years old, with a well-structured financial portfolio already in Europe, wanted to diversify part of his capital into **South Korean residential real estate** to seek rental yield and exposure to the **South Korean won**. Allocated budget: **$400,000 to $600,000**, without borrowing.
After analyzing several markets (Seoul, Incheon, Busan), the chosen strategy was to target an apartment in a **high-growth neighborhood**, such as Gangnam in Seoul or Haeundae in Busan, combining a **target gross rental yield of around 7–8%** – with the rule **”the higher the yield, the greater the risk”** – and medium-term appreciation potential, for a total ticket (acquisition + fees + possible renovations) of about **$500,000**.

The mission included: **city and neighborhood selection**, connection with a **local network** (real estate agent, Korean lawyer, tax specialist), **choice of acquisition structure** (direct ownership, possible local company), and definition of a **progressive diversification plan**.
This type of support allows the investor to benefit from **South Korean market opportunities** while controlling **legal, tax, and rental risks**, and integrating this asset into a **coherent overall wealth strategy**.

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About the author
Cyril Jarnias

Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.

On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.

Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.

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