Occurs in multi-room interiors other than the first room. Can sometimes pause and quit to main menu. Reopening the world results in normal frame rate, but oincs from carpet are not recovered. The type of carpet does not matter. Issue only occurs with carpets. Other furniture demolishes normally.
Build multi-room slanty shanty in shipwrecked, place carpets in center of rooms (not sure if needs to be in center) beyond the first room, hammer carpet.