Yesterday was a remarkable rally on the stock market, but it was a real humdinger for Homestore, which closed at $1.53, up over 40 percent from its previous close, on trading volume of 1,879,308 shares.

Naysayers said that Homestore would never see a dollar again, not with seemingly insurmountable odds against it - restatements of revenues in the multimillions, shareholder suits, DOJ and civil investigations into former officers dealings, customer complaints about its loyalties, and a widening rift with its major content and royalties partner, the NAR.

With just about everything against its survival, including a busy, confusing Website, Homestore started over with new management and a game plan to make the site a better partner to Realtors.

On September 24th, I wrote that Homestore might be a good bet, but I imagined nothing like the quick turnaround in prospects as evidenced by yesterday's stock price rise - especially since the rise came with no news announced at market close.

I contacted Homestore and asked what was going on. Was the AOL dispute settled, maybe? Spokesperson Dan Wool politely informed me, "As you may know, it is company policy not to comment on market rumors or stock activity." End of discussion.

Well, then, what's making Homestore look so rosy to others? Let's do a little review. Out of the ten reasons I named in September that made Homestore a good bet, let's see what's changed:

1. The class-action suit should be settled. I argued that burned investors had little to gain by taking HOMS to court, and would likely settle.

   Only a few days ago, it was announced that the class-action suit had been expanded to include deep-pockets AOL Time Warner and Cendant, as well as key executives with both firms, among others.

   This is favorable to HOMS because the list of alleged miscreants is now much longer and there are more wallets to open to return lost share value to investors.

2. AOL dispute will settle - I argued that the worst case scenario - that HOMS would have to pay AOL - has already been accounted for and that the money is restricted cash.

   But there's more. AOL and Homestore essentially have a gun to each other's head. Arbitrators will see that and work out a compromise that is fair to both parties and will help keep the relationship they both want profitable. It also doesn't bode well for AOL that it has been named in HOMS class action suit.

   AOL doesn't want to have to hunt for another provider to handle its house and home channel. Who would it get? A VOW for every city, like Yahoo!? That's the slow way to profits when HOMS would be willing to simply write a big check for exposure, and AOL keeps from losing its house and home channel provider. If HOMS walks, they walk away with everything. If HOMS has to pay AOL in shares, AOL doesn't necessarily own everything - the NAR can simply exclude Realtor.com, and AOL is left without listings.

   A more sensible solution is that HOMS pays AOL a handsome monthly sum for exactly what it is doing - advertising the listings, and that HOMS gets back its investment by helping brokers and agents with their personal promotion.

3. The SEC won't punish HOMS - HOMS is cooperating with the SEC, and fraudulent actions were committed by individuals, not the company. It's nice to be right - HOMS was cleared by the SEC on September 25th.

As for the rest of the list, little has changed. Homestore is still lowering its burn rate, is hoarding its cash, and has zero debt. It's subsidiary, Realtor.com, is still the most recognized homes portal name by consumers, especially since arch-rival HomeAdvisor now calls itself MSN House and Home channel. There's no reason to assume customers aren't renewing, and that the site still has over 100,000 active customers.

In fact, at the NAR, Realtor.com announced a number of Realtor-friendly initiatives that should boost new subscriptions and renewals, namely that agents can now link their favorite Web sites to their Realtor.com listings for a subscription.

NAR still backs Realtor.com, and HOMS new management.

The only question is the IDX/VOW (virtual office Website) issue, number nine in the list.

Not enough attention has been given to the fact that the IDX/VOW threat didn't materialize against Homestore, and I believe fervently that it won't.

The fact that the NAR delayed its vote on adopting new VOW policies has me more convinced than ever that the advertising ramifications of VOWs have yet to be discussed and widely understood by brokers and agents. When those issues are sorted out, which advertising mediums brokers and agents use will become crucial. What will they be charged to promote their VOWs on national portals? What will VOW providers charge to create a VOW for a broker? What will MLSs charge brokers to download data so they can have a VOW?

IDX/VOWs were supposed to be the death knell for sites like Realtor.com, but the upshot is Realtor.com may end up being one of the few portals that can help brokers push their VOW sites out to the public inexpensively. The site is already positioning itself as a VOW provider and Realtor-friendly linker to Websites of Realtors' choice.

While sites like Yahoo! engage in exclusive relationships with a few brokers in key markets, other brokers' VOW sites can't be seen on those sites, which means that brokers with VOWs will be faced with the same problems they had with ordinary Websites - how to get found.

While NAR rulings may insist that brokers' contact information is on every listing, and that has yet to be decided, what consumer will click on every broker's Web site to see if they have better listings than the e-broker VOW they are already using?

The problem will come full circle - the high cost of VOW development and getting found. Sounds like Websites only a few short years ago, doesn't it?

Realtor.com is positioned to be a service provider and serve as a medium to push out the sites. That sounds pretty smart to me.

While I still don't know why HOMS had such an upsurge in its stock, at least it's nice not to be wrong about the company's prospects.