The Victoria city of Horsham resembled a lake after the Wimmera River overflowed its banks [GALLO/GETTY]

Authorities have urged residents to flee more southern Australian towns as swollen rivers worsened a natural disaster that the government says may be its costliest ever.

The rivers carried deadly floodwaters deeper into the country's Victoria state on Tuesday, the latest region afflicted in a weeklong flooding crisis that has left 30 people dead.

Up to 500 homes were isolated in Victoria as the Wimmera River overflowed its banks, bisecting the city of Horsham before starting to recede in the afternoon.

Officials sent three emergency alerts overnight to residents in the path of the high water.

"At 5am local time they were out on the megaphone just yelling 'evacuate'," West
Horsham resident Brett Insall said, though he stayed in his home. "I'm not too worried about it. It's only water."

Thousands evacuated

The state's emergency service incident controller said the water would slowly recede through the day.

More than 3,500 people have evacuated their homes across Victoria, with 51 towns and 1,500 properties already affected by rising waters.

The flooding in Victoria follows a six-week crisis in Queensland, where floodwaters swallowed an area the size of France and Germany combined, culminating in the swamping last week of Brisbane, Australia's third largest city, and utter devastation of towns to the west.

Experts have linked Australia's downpours to an especially strong La Nina weather pattern bringing cooler water temperatures and exacerbating the traditional tropical cyclone season.

Task force announced

Julia Gillard, Australia's prime minister, announced the formation of a business task force on Tuesday to assist with rebuilding devastated infrastructure in Queensland.

She said a day earlier that the floods that ravaged Queensland could be the country's most expensive natural disaster ever.

"We don't even know what the price tag is yet because we can't even know what the full flood damage is. So we will work through this a step at a time," she said.