First of all, in my humble opinion, this lady is not a true friend. Friends don't treat each other this way.

If you have nothing in writing, lease/rental wise, you are screwed.

Lastly, I think she will have a hard time selling a house knowing what the market is in many parts of the country.

I would find a place to live, quickly, and leave the situation. I really would consider the "friendship" stressed beyond the normal...and write this off to being a bad lesson in life.

I am sorry your friend couldn't and wasn't more honest with you.