FWIW, I have. It was many decades ago, with a washer in the basement. The hose just burst, and by the time I was aware of the problem, the basement was a swimming pool with a foot or two of water in it, and all kinds of things floating around, despite the nearby drain (so long ago I can’t remember why the drain didn’t do the job it was supposed to do, but those things happen). Nothing really horrible ensued except that I had to throw out a lot of stuff including a valued carpet that was being stored down there.
I still have no issues at all with my laundry room on the second floor bedroom level and the armored hoses I have installed. And, as mentioned, there are other precautions one can take, like the special valves. But perhaps we’re not understanding the layout of your new house. All I can say is that having the laundry room on the same level as the bedrooms is a real blessing.
In my previous house, the washer & dryer were right next to the bedroom and it was soooo convenient. Consider that just about everything you wash is on the second floor. All of your clothes are there, as well as towels and bed linens. I could leave my top sheet in the dryer whirling around while I put the fitted sheet on the bed and then whisk out the top sheet with nary a wrinkle. The only thing wrong with my current (otherwise perfect) house is that the laundry is in a laundry room far away from where I keep the stuff that I wash.
I’ll bet the people who build this house had their laundry on the first floor in *their *previous residence and considered the second-floor laundry an improvement.
Many two-story homes have the living room, dining room, kitchen, powder room and so forth on the first floor and the bedrooms and private bathrooms on the second floor. The bedrooms are where most of the dirty laundry ends up (as you undress at the end of the day) and where the clean laundry goes (to the closet or dresser). So for people living in these houses, having the laundry facilities on the second floor is convenient. Perhaps your situation is different.
Question is answered, but I want to add a few things from a builder’s perspective. As mentioned, upper floor laundry facilities are a normal feature in many new homes. Plumbing code (and common sense) requires a drain that directs any flood water down to the main drain in the basement. This really reduces the potential flood damage.
We use to put full facilities both near the bedrooms and in the basement, and that seemed to be popular with buyers. Quite often with upper floor facilities there are still standard laundry hook-ups near the mechanical room. Even if there isn’t it is usually trivial to add them. The hardest part is likely adding a dryer exhaust vent.
Due to experience, two things that I will not have in my house’s living space hot water heater and washer. I never have had a hose burst. But have had seals go out on several washers and normally that is how I find out it is time to replace the water heater. I do not want a possible major problem in the house, not major if they are in the garage.
Here in Michigan, even attached garages can get below freezing in the winter. Add in the possibility of accidentally leaving the garage door open for a few hours, and putting the washer and water heater in the garage would just be asking for trouble.