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InTroDucTioN:

The standard water heater storage tank heats up and stores gallons of hot water. But, it isn’t as efficient as the best tankless water heater, which increases energy efficiency by 24-34 percent according to the U.S. Department of Energy.

Tankless water heaters don’t need to store water making them significantly smaller than a traditional storage tank. Instead, they heat water instantly as it enters the unit for a limitless supply of hot water.

Before You Buy a Tankless Water Heater:

Tankless water heaters are growing in popularity for the average homeowner; however, there are a few considerations to take into account before purchasing.

Tankless heaters will cost more initially, between $1,000 to $3,000 before installation. With installation costs included, the price rises to $2,000 to $6,000 nationwide on average, while storage-tank models only cost between $1,000 to $2,000 with installation.

Another thing to consider is the hot water requirements of the household. If multiple showers, a clothes washer, and a dishwasher are all expected to operate simultaneously, a tankless model may have trouble providing enough hot water to all locations at once. Bigger families with high demands may benefit from a large, traditional model capable of keeping up with their needs as a tankless unit requiring that type of power may be out of the price range.

Installation is another consideration. If your home has a storage-tank heater, expect that the electrical wiring, gas piping, water piping, and ventilation (for gas models) will likely need to be reconfigured to fit the much smaller, wall-mounted tankless unit. The installation will typically take longer and cost more.

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