Hello
@Mega_Green_steve!
If you're talking about above water, then no. It's completely unlimited as you can actually go to the other islands, however you won't be able to enter them if that island owner has locked their island.
If you're talking about underwater, then yes, the water goes down to y5. If you go below this you will be bounced back above the level. It makes a for a good trampoline if you've got nothing to do!
Hope you're enjoying islands! -Self