The demolition costs are a minor fraction of the purchase price. There aren’t a lot of large undeveloped lots down here in Southeast Florida where you can build a large home unless you want to move to an undesirable area much farther from the coast. In my parent’s neighborhood in East Boca they tear down pretty much all of the purchased homes to rebuild. What she is doing is pretty standard in this geographical area for wealthy neighborhoods.
Fair enough. This kind of thing is so outside my personal experience, that its hard for me to conceptualize. As F. Scott Fitzgerald once wrote: “the rich are different from you and me.”