The City of Bendigo has warned of "large movements" in some people's rates bills this year because of demand for Bendigo real estate.

Property owner Damien Kingsbury had been told the value of his Long Gully house had risen 60 per cent higher than what he paid for the property just over a year ago.

He said such a high valuation was "outrageous" and was struggling to see how it could be justified.

"Yes, I've appealed," Mr Kingsbury said.

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Mr Kingsbury agrees his property's value has risen but is sceptical of Victoria's Valuer-General's valuation, which shaped the way the council calculated his bill.

"If I could put the place on the market tomorrow and get what they are telling me it's worth, I'd happily do it, but it's not going to happen," he said.

Mr Kingsbury estimates his property had risen by 10 per cent or more, in line with the wider neighbourhood's.

He believes he could find the money to pay his rates bill if he has to but fears for others in the area who might also have also witnessed a large spike.

Average house sale prices in Long Gully swelled to $385,000 in 2021, figures on the Valuer-General's website said.

Prices are well over the $220,000 the average Long Gully house fetched ten years earlier, which was good for those selling but not necessarily for those staying and paying rates.

The Valuer-General does not use those figures for property valuations but they do give an insight into the way property prices have ballooned, especially in recent years.

"Property in Long Gully is towards the lower end of the market so it's the sort of place a person might live in if they don't have a big income to start off with," Mr Kingsbury said.

Price rises have been accelerating Bendigo-wide, as the animation below shows:

That could be because metropolitan investors have been looking to regional areas thanks to lockdowns and high prices in their neck of the woods.

The statistics do not include units or vacant land, which are calculated separately.

Ratepayers are shielded to some extent by a state-imposed cap on rate rises which has limited Greater Bendigo's to 1.75 per cent this year.

The cap covers the entire municipality and individual ratepayers' bills can rise or fall by larger amounts.

Commercial ratepayers appear to have been granted a reprieve from steep rises this year.

Bendigo's council expects to make $2.6 million less from them because of minimal changes in valuations for their properties.

Ordinary ratepayers will likely pay an extra $5.75 million thanks to real estate demand.

The Reserve Bank's recent interest rate rises have not yet appeared to stop house prices climbing in Bendigo even as metropolitan markets lost value, according to newly released Real Estate Institute of Victoria data.

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Regional Victoria's house prices rose by 21.5 per cent last quarter, though some real estate agents expected Reserve Bank interest rate decisions to start making themselves felt soon.

People can challenge their property valuations directly with the Valuer-General.

The council has financial hardship policies including flexible payment arrangements and has urged people to visit its website to find out more.