I think a similar thing would have happened in the US during the Great Recession of 2007, however, the US government was willing to back all of the banks who were holding underwater mortgages. Had the government not done this, the banks would have been forced to unload property at fire-sale prices.

10 years later in major metropolitan areas, property prices are even higher than they were in 2007. Most likely the Federal government would pursue another bailout during a housing "collapse".