Just like the price of gasoline rose dramatically in the wake of Hurricane Katrina, so are the prices of housing in Baton Rouge and other outlying cities and towns, as former residents of New Orleans, Biloxi, Gulfport and smaller towns devastated by the hurricane are anxious to get on with their lives and settle in a location.

"Prices of real estate in the outlying areas around New Orleans is going through the roof," said Wayne Pugh, a Baton Rouge, La., real estate consultant, who is vice president-elect of the Appraisal Institute.

According to Pugh, people and businesses started looking for housing and commercial real estate once they realized the property where they were living and operating businesses would not be available in the foreseeable future.

"First, these people rented all the hotel and motel rooms in Baton Rouge; then they rented all the apartments," Pugh recalled. "Then they started bidding on the houses, which began selling for significantly more than their asking price. The real estate prices in Baton Rouge went up 25%-to-50% in a matter of hours."

Griffin Sole, a displaced commercial insurance broker looking for a home in Baton Rouge, said, "I heard of one $90,000 house being bid up to $180,000."

Sole, like many others, decided to move further west. He settled in Alexandria, La. Lafayette, La., located several hours northwest of New Orleans, has also become a boomtown. Dallas and Houston have become home to many larger companies that have operated in the affected area.

Government agencies, such as FEMA, have entered the bidding war in Baton Rouge, buying a significant amount of new construction entering the market.