The values of shares of Australia's Big Four banks that were sold short as of May 16 totaled up to 9.03 billion Australian dollars – or $6.52 billion – amid rising concerns that the country's property prices are headed for a steep fall. According to data from the Australian Securities and Investments Commission, the numbers are 85 per cent higher since the start of the year.

Bets against Australia & New Zealand Bank (ANZ), Commonwealth Bank of Australia (CBA), National Australia Bank (NAB), and Westpac have piled up recently, driven in part by Australia's housing bubble fears.

"Our house price-to-income ratio now in Australia makes the American housing bubble in the lead up to 2007 look positively moderate," said Jonathan Pain, publisher of investment newsletter, The Pain Report. "Australian banks are heavily invested in probably one of the most inflated real estate markets in the world and we now have an avalanche of residential housing supply hitting the market."

Aside from rising median prices in Australia's capital cities, the number of mortgage in arrears and household debt-to-income ratio also went up. But not everyone is expecting a major crash soon.

"If a U.S.-style plunge in prices was going to happen in Australia, it probably would have taken place during the global financial crisis, when lending standards were looser and when the banks were more exposed," said Paul Dales, an economist at Capital Economics. He noted that prices may only begin to fall by 2018 when interest rates could start to rise.

"Any price fall will be smaller than the 30 per cent drop in the U.S., though mainly as the relative health of Australian banks will prevent a U.S.-style spiral of large loan losses leading to a severe credit crunch and yet more losses," Dales said.