Is Spain an attractive vacation home locale? It used to be, but for those interesting in perhaps investing in Spain’s vacation rental property sector, you may want to wait and see how the market fairs over the next 12 months before getting in.

Spain’s construction industry fell by 3.9 percent between October and November 2007, the greatest drop in the Euro Zone, according to Eurostat.

Mark Stucklin, head of SpanishPropertyInsight.com and writer of the “Spanish Property Doctor” column in The Sunday Times (U.K.), estimated that approximately 18 to 20 percent of Spain’s economy is dependent on the construction sector. In comparison, other European countries average 8 to 9 percent, he said. This means that a hefty correction is likely in order before Spain’s market can truly begin to heal.

“Spain’s economy has become too dependent on construction and now that’s going to have to adjust,” Stucklin said. “I can see it coming down to the EU average, which means knocking 10 percent off of Spain’s GDP.”

The tourism industry, however, is still going strong. The number of international arrivals increased 4.8 percent from 2005 to 2006, and Spain’s tourism sector brought in over $51 billion U.S. in 2006, according to a WTO report.

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