When you're taking to Isabelle, there should be a 'i need help' or something like that option before let's get started, then there should be a 'demolish town' option.
Choose the character, and when Isabelle loads up, go to other options instead of starting up normally. One of your options will be reset the town, and there you go!
Press continue on the opening screen, and then once you've pressed continue click on the saved characters name and once Isabelle finishes her speech, instead of clicking "yes, let's" click I need help first... there should be four options, out of the four click the third one. This should delete the saved file along with the mayor, when Isabelle asks if you're sure you want to do this click yes both times. Hope this helped!