SKYROCKETING land values, thanks to the dairy industry boom and lifestyle property demand, have driven up farm rates in several Victorian shires.

Western Victoria has led the charge with the Victorian valuer general saying values have jumped 35 per cent since 2006.

Moyne Shire councillor and former farmer Gerald Madden said the dairy industry's hunger for land on the back of record milk prices was driving up land values and rates in the region.

"More traditional beef and sheep areas where I had my farm are going across to dairy, especially inland, to the north," Mr Madden said.

East of Moyne, Moorabool Shire valuations have also been on the rise. The value of some has risen 100 per cent.

Lal Lal farmer Geoff Fisken said his rates had risen from $16,000 last year, on his home property of 2000ha, to $31,000 this year.

"North of me, there's high-value potato ground where the rates have jumped 140 per cent," Mr Fisken said.

"The council has said it's dropped the rate in the dollar to compensate for it, but we've got 70 landholders lodging appeals against their rates."

Moorabool landholders were due to hold a meeting with council representatives last night to discuss the rises.

The shire's rates officer did not return calls to The Weekly Times to discuss the issue.

But while some landholders are angry at the surge in rates on the back of the rise in valuations, others have seen their rates drop, especially on irrigation properties.

Irrigators in the Boort region have seen their property valuations drop an average of 17.5 per cent, as a result of state legislation that prohibits councils from valuing water, which is no longer linked to land.

Loddon Shire rating director Judy Holt said the biggest problem for the shire was rebalancing the rating pie to offset the loss of rates revenue from irrigated properties.

She said dryland farmers in the south of the shire had seen the average property value rise 36 per cent.

But Ms Holt said much of the increase was driven by the general rise in farm values, plus the greater demand for lifestyle blocks from people working in Bendigo.

The valuer general found rural property values had risen 17 per cent from 2006 to 2008 in north central Victoria, 16 per cent in the North East, 15 per cent in Gippsland and 12 per cent in the northwest.