The narrator believes that just as everything else on the lane has changed, the Hempstocks must also have changed in the last several decades. It’s telling that the narrator believes this woman is the younger Mrs. Hempstock when she so resembles Old Mrs. Hempstock. Though the novel doesn’t confirm or deny the narrator’s assessment, it’s possible that since he believes everything
should change, that’s what he sees—when his initial assessment may be correct.