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The hardboard siding that was commonly used on homes 20 to 30 years ago is very prone to water damage so replacing it is a common chore. The first step is removing the rotten siding with a flat bar. Often, you only need to replace the bottom few courses which get backsplash from the ground. Driving nails all the way through the last good row with a nail set will free up the damaged row beneath it so you can remove it. I always use Fiber Cement material to replace hardboard siding because it’s easy to find in matching sizes and textures and since it’s made mostly of cement it won’t ever rot or decay like the hardboard. You just nail it up so the courses match the rest of the siding and before long you’re ready to paint it.