In the Upper Hunter the increase was described by the Valuer General as "very strong" with a 66 per cent increase for 95,990 properties in the Cessnock, Dungog, Maitland, Muswellbrook, Singleton and Upper Hunter council areas, which rose in value from $32.9 billion to $54.6 billion in the year to July 1.

The NSW Valuer General's report said Hunter rural land values in particular had increased by 72.2 per cent overall. This was driven by increased demand for "rural lifestyle properties" with remote working options and proximity to city centres.

"Good seasonal conditions and strong commodity prices have driven very strong increases in the regions primary production properties," the report said.

The residential land values in the Hunter's regions increased by 57.6 per cent overall, with the strong increase in land values driven by "lifestyle options", as well as the "relative affordability and proximity" to Newcastle and Sydney.

Statewide, the Valuer General said land values rose from $2.25 trillion to $2.84 trillion in the year to July 1, 2022, an overall increase of 26 per cent. Residential land rose by 24 per cent, commercial by 22 per cent and industrial by 49.6 per cent.

"Property sales are the most important factor valuers consider when determining land values," the VG's office said in a statement announcing the new calculations, saying they "were assessed following analysis of over 61,000 property sales".

"All of NSW experienced increases in residential land values," the VG said.

"The residential market experienced a continuing trend of buyers focusing on regional areas with purchasers seeking affordability and alternative lifestyle options.

"Regional and coastal markets with accessibility to regional and metropolitan centres were particularly sought after."

The VG said the valuations were used where councils had "ad valorem" calculations in their annual rates. They were also used in calculating investment land tax and the new property tax alternative to stamp duty for first-home buyers.

The stamp duty reforms took effect this week, allowing eligible first home buyers to pay an annual property tax, rather than up-front stamp duty.

"The relevant annual tax is derived from the underlying land value as determined by the Valuer General," a spokesperson said.

Revenue NSW says the annual property tax alternative is available for first-home buyers of houses worth between $650,000 (when stamp duty begins) and $1.5 million, and on vacant land up to $800,000.

It says the property tax rates for 2022-23 and 2023-24 have been set at $400 plus 0.3 per cent of land value for owner-occupied properties, and $1500 plus 1.1 per cent of land value for investment properties.

Opposition leader Chris Minns announced on Monday that Labor would scrap the tax and lift the stamp duty threshold to $800,000 if elected.

Because the new VG figures are based on the 2021-22 financial year, they do not take into account the substantial falls in property prices that have transpired since the Reserve Bank issued the first of eight interest rate increases in May last year, taking the cash rate target from 0.1 per cent to 3.1 per cent.

Property prices have reportedly slumped by about 7.0 per cent, nationally, since the rate rises began, and prices are expected to fall further as the impact of the existing rates continues.

Despite the substantial double-digit increases in the new VG figures, council rates must remain within the limits set by the Independent Pricing and Regulatory Tribunal, which has "pegged" increases of between 3.7 per cent to 6.8 per cent for the 2023-24 financial year.

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