In a country where owning property has become an obsession, the people's stand on the popular tax law known as negative gearing might dictate the outcome of the national election slated for early July.

Negative gearing gives a tax break to landlords, which then results in a surge in property prices and rising unaffordability. Prime Minister Malcolm Turnbull, whose popularity is declining, is betting that Aussies will not tolerate any threat to their home's value. Around 1.2 million Australian real estate investors use negative gearing, which allows them to lower their tax bill by deducting the costs of owning a rental property.

On the other hand, the Labor Party is trying to curb the tax break in order to combat unaffordability, especially for first home buyers. They want to ban the practice for existing homes, which account for 93 per cent of property investment last year.

"Housing is one of the main areas where the two political parties differ significantly," said Callam Pickering, a former economist at the Reserve Bank of Australia. "It almost feels like a bit of a referendum on the housing market—depending on how you feel might affect the way you vote."

Owning a house is an uphill battle for first home buyers, especially in Sydney. They often have to pay 12.2 times the median annual pretax household income, compared to just 8.5 in London. Because of this, Turnbull may struggle to attract young voters in Sydney.

"People care a great deal about their houses," Pickering said. "The possibility that housing could collapse is probably going to scare them more than almost anything else."