Further down the wall
This is the area next to and below the lower window in the previous picture. The further down the wall, the more rot. Here the OSB just flaked off if you touched it. As the contractor was using a prybar on the stucco, it was sinking through the OSB.
Oh, and did I mention that the grading was done wrong as well? Because the stucco continued directly down from the framing over the foundation with no weep screed, it was impossible to tell from the exterior where the foundation stopped and framing began. When they did the final grading, they buried the rim joist partially in the dirt. This is what happens when you bury a rim joist.
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