I've had one go out in the garage and the water just ran out through the garage door. If you have a place other than the basement to relocate it where a leak won't matter, then that would be the way to go.
Our second water heater is in a closet in our master bath, which is sitting inside a pan to catch water if it ever leaks. That would work well if you catch it soon enough like you did in this case. (Have same setup for an a/c air handler in another closet.). I look in on them every once in a while, but if it started to leak when no one was home, it would be a mess because the pan would eventually overflow.
Also, see post 6 in this thread for some maintenance you can perform to mitigate risk:
https://f80.bimmerpost.com/forums/sh....php?t=1369906
As far as tankless (original point of that thread), if you have gas service to your home, I'd consider it. I don't so would need to bury a propane tank (can't have above ground). I looked into electric tankless and decided against it primarily for cost reasons (mostly electrical work, not the cost of the tankless heater). There are numerous factors that go into whether tankless makes sense for you or not.