Usually, the most challenging time for plants in terms of risk of dying is during establishment, and that period lasts for the first few years after planting (the larger/older the plant installed, generally the longer that establishment period is). Watering (as-needed based on weather) is very important for new plantings so they don't get too dry, but you also need to avoid over-watering or flooding the root zone with too much water that takes too long to drain away, as that can suffocate roots. The roof downspout outlet we see in the photos could cause problems for plants near (or downhill of) that extra water flow during rainy weather. If possible, try to extend the pipe away from the house (which is also helpful to avoid foundation/basement moisture problems) by hooking up an extension pipe (usually they're buried) before planting close to the downspout.

Nothing needs to be done to the soil where the dead tree is/was, especially if a root infection was not suspected as a cause of death. Such organisms are ubiquitous in the environment anyway, so even if a soil treatment were useful and warranted, it wouldn't sterilize the soil for very long. Plants tend to become more vulnerable to opportunistic infections when they are stressed or injured; they don't typically succumb in ideal conditions.

Unless you know for certain that herbicide was used immediately near the old tree (and even then, what risk of damage there was greatly depends on the dosage exposure and what chemical was involved), there is no reason to worry about residual herbicide problems. Residues from pesticides break down over time, and while the rate of breakdown depends on many factors, exposure to sunlight, moisture, and soil microbes are typically the elements that degrade the residues into more innocuous ingredients. It would be very unusual for any residential-use herbicide to last for longer than a few weeks (if that).

Any tree or shrub whose roots are close to a foundation might cause damage if the foundation has any fine cracks in it. As far as we know, roots cannot break into an intact foundation. For the health of the tree, no tree or large-statured shrub should be planted close to a building wall/foundation, both so the root system has enough space to support the plant (support in both the literal/physical and biological sense) and so the branches of the mature plant have enough room to get airflow, light, and don't hit the wall and become wounded.

Magnolias are, as a group, shallow-rooted, and some species and varieties mature quite large. You mention wanting a dwarf Magnolia, but "dwarf" is a relative term that depends on what the mature size and growth rate of the non-dwarf version of the species or hybrid in question is...a dwarf cultivar of Sweetbay Magnolia, for example, may stay an 8-foot shrub for a while (eventually getting 15-ish feet tall), while a dwarf Southern Magnolia can get 20 to 30 feet tall. Ideally, you want to make sure the tree has enough height and width space to allow for it to reach full size, and the expected height/width dimensions will be unique to each cultivar. If we had to generalize, though, you'd probably want the trunk a minimum of 10 feet from the wall.

Miri