Well, sea level rise is driving this, the existing house is worthless as nobody will buy it.
Very tough to have to start over with no equity at all.
There is an existing program through FEMA for some of this. It is administered through the county. I worked on a project some time ago where we'd go out and collect elevation information on properties prone to flooding.
The county would make the owner a FEMA-backed offer on the house so they could knock it down. Most of the time the owners took it and ran.