@Jyotai, After about 6 weeks (sim time) of having move-in/move out enabled for half the households in my game I can say with pretty much certainty that Neighborhood Stories doesn't split people from households nor does it merge different households. When it does move-in/move-out it moves the entire household and only the entire household.
I was hoping it would, and that teens would move out on their own when they became YA's automatically. This would make NS better than MCCC for that kind of moving functionality. Disappointed that it doesn't and now that I've tested it enough I have disabled that feature in NS in favor of MCCC.
I'd be happy if someone came along here and said I was mistaken though, and I just didn't leave it running long enough to see it happen.
