Towards the beginning of the episode when Sophia shows up she says that the home burned down. A few minutes later Blanche comes out of her room (which seems to be on the patio...) and tells Harry that the home had burnt down, now if she had been in her room the whole time, and no-one had been in to tell her, how could she have known this?

Also, In later episodes, Shady Pines is talked about as though it is still standing (I believe Dorothy even threatens to send Sophia back in the episode about Charlie trying to contact Rose. Dorothy: "Remember Shady Pines ma?" Sophia: "Aww, It's wasn't that bad" Dorothy: "I heard it was bought by some Germans..." Sophia: "I'll go tell her") Hey, didn't Sophia even go back in Empty Nest? What happened to it burning down?