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polyisocyanurate board

We live in s.e. PA and have an Alladin package house, c. 1919. Siding is vinyl over 1/2" ply board, probably from the 80's, nailed to the original sheathing. The upstairs bath is down to the studs for complete renovation. Studs are full dimension 2x4. Is this a good application for iso board?---this would be one outside wall, two interior, and interface with the attic. With poly board on the outside, should there be an interior vapor barrier under the new drywall? Should there be any airspace left in the outside wall/ceiling bays? In other words, if using iso board should it be the full 4" or a lesser thickness?

Re: polyisocyanurate board

If you are going to have a gap, then it should be on the outside, but I believe you can fill the cavity if you want to. I would try to leave a small gap if possible, just in case water gets under and behind the vinyl siding. Since this is a bathroom, you need to protect the studs from water damage. You will probably layer tap paper over the studs behind the shower/bathtub, but I think I would add a vapor barrier as well

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