What? Where did I suggest this? Building up can mean a stacked multi story condo, attached to others. Our city has tons of these. It allows you to house several families in a footprint smaller than several single family homes would take up. Condensed living doesn't mean tiny box sized apartments. There are many ways to maximize space in a small footprint. In addition, if people would just be willing to give up yards, you can fit a LOT more houses in smaller spaces. This allows you to not have to extend into areas that should not be developed.
And going "up" may also be single detached homes that go up on stilts. That definitely happened in my area after Sandy......and for all levels of housing. Just single homes that were raised up 8-12 feet. There were plenty of out of state companies that specialized in this that moved into our area.... a really specific skill.
I do think that there's a serious level of second homes in the destruction....lots of snow birds. Most of those people will be okay as they obviously have another place to go, and many of them have enough money to make necessary repairs. It's the year round middle class residents that are going to struggle. I can't think of a recent storm other than Katrina that will impact so many people.