How Much Does it Cost to Install a Tankless Water Heater?

Typical Range:

$1,253 - $3,556

Find out how much your project will cost.

Cost data is based on actual project costs as reported by 2,878 HomeAdvisor members. Embed this data

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  • Homeowners use HomeAdvisor to find pros for home projects.
  • When their projects are done, they fill out a short cost survey.
  • We compile the data and report costs back to you.

Published January 10, 2022

Reviewed by Cati O'Keefe, Expert Home Building & Sustainability Contributor.

Written by HomeAdvisor.

Tankless Water Heater Cost

A tankless water heater costs about $2,382 to install, or between $1,253 and $3,556, but labor rates vary. Tankless model prices vary by brand, type and flow rate. The best way to budget for a new tankless water heater is to compare quotes from local contractors. Ask your local pro whether your tankless system qualifies for a tax refund.

These units have the potential to save you money in the long-run if they are installed and connected correctly. To make the most of your investment and ensure the equipment operates at its highest capacity, hire a professional. They will have the experience necessary to both expedite and guarantee proper installation.

Tankless Water Heater Cost Calculator

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National Average $2,382
Typical Range $1,253 - $3,556
Low End - High End $350 - $5,400

Cost data is based on actual project costs as reported by 2,878 HomeAdvisor members.

Tankless Water Heater Installation Cost

the average cost to install a tankless water heater is $2,200 or between $350 and $4,800

Consumers who hire a professional can expect to pay either an hourly fee or a flat fee. The average hourly rate for a plumber to install a tankless water heater falls between $45 and $150 per hour. Final labor totals average between$100 to $450.

Cost Factors

The most influential cost factors are labor and the type of heating equipment you choose. Consumers will also need to calculate material and labor for necessary parts. The accessories needed typically include:

  • Termination vent kit: $40-$100

  • Gas connector kit: $20-35

  • Two-piece lead-free brass valve set: $60-$110

  • Fittings and mounting hardware: $10-$30

  • Insulation and piping: $10 per foot

Other cost factors include removal and disposal of the current heating system, electrical updates, added insulation, and possible structural modifications to accommodate the new unit.

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Average Cost of Tankless Water Heaters

Your total project cost will vary greatly depending on the type of equipment chosen. Single point electric units cost around $150 each, while a high-end gas model for the whole house could be over $1,500.

Tankless TypeAverage Unit Cost
Natural Gas or Propane$1,000 - $1,500
Electric$500 - $1,500
Solar$1,400 - $6,000

Understanding what type of unit you need is the first step.

  • Noritz gas tankless unit of 199,000 BTUs: This is sufficient for an average household with several bathrooms. It can take up to 10 hours to install. Labor will be more expensive to install proper ventilation to prevent carbon monoxide poisoning and change the size of gas lines and fittings.

  • Electric, point-of-use model: This can be installed under the sink. Only averages two hours for installation. Requires an electrical timer, outlet and supply lines.

Whole House or Single Point

Single point, or "point of use," tankless systems are placed specifically by and for individual appliances and faucets that need them. They are relatively easy to install and cost $100 to $300 each. They will be more efficient than using one for the whole house, as the water only travels a short distance and less goes to waste. These single point systems can be useful in homes with multiple bathrooms and appliances, as they operate independently of each other.

However, an average-size home with regular usage throughout the day will function well on one whole-house unit.

gas tankless water heater
by Village Plumbing, LLC. Henderson, NV. Gas tankless water heaters in Las Vegas cost an average between

Natural Gas or Propane Water Heaters

Natural gas and propane styles cost an average of $1,000-$1,500 to install. While these two forms of gas will fuel your system in much the same way, some distinct differences in acquisition and operating cost exist.

Natural gas relies upon a utility supply line while propane must to be purchased independently. If you live within a certain distance of a natural gas line, you may be required to use it. For most homeowners, this isn't a problem. Natural gas is the less expensive option, costing an average of $200 per year versus the average $350 per year to run a heater on propane.

Propane is a cleaner and more efficient fuel, however, and boasts a higher BTU capability than natural gas.

Gas tankless styles are widely available in a large variety of models and sizes. They also range in output from 140,000 BTUs to 380,000 BTUs and are available in residential and commercial grades.

If a natural gas line is made available in your area, be sure to check that your appliances can be converted before making the switch.

Electric Tankless Water Heater Prices

"Electric whole-house tankless water heaters require 240V 80 Amp hard-wired electrical service at a minimum, which means your home needs to have at least 150 Amp service to operate all the appliances."

Cati O'Keefe, Expert Home Building & Sustainability Contributor.

Electric models are less expensive than gas ones and are an average of $800 to $1,500 to install. The installation work required is not as complicated when compared to gas models because there is no need to vent. They are also easier to maintain, perform very well, and produce high energy ratings.

The tankless electric unit is more efficient than one with a tank by 20% to 30% and emits zero greenhouse gases. These units require more energy than gas ones, however, and you may need to hire an electrician to rewire your home for one. Electricians typically charge $50 to $100 per hour.

  • Electric Hybrid Water Heaters : These are initially expensive but heat faster than standard, electric models. Though they are not considered tankless, they share many elements of a tankless system: They do not need ventilation and are very economical. However, they are only available in models up to 8,700 BTUs.

  • Point-of-Use Electric Models: $100 to $300 each - These offer a lot of attractive features such as affordability, and ease of installation. They are also very convenient to use under sinks, in small areas, and even near washing machines. This is an excellent option for people who need small units for campers, boats, and small bathrooms. They are non-corrosive, insulated, attractive, and lightweight. They help save water by conveniently heating it and providing it quickly.

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Solar Units

Solar heaters costs about $1,700 to $5,000 to install. Prices are known to get as high as $13,000. These styles have some of the highest returns, however. First, they qualify for the 30% tax credit. For a $6,000 install, that's $1,800 returned. Second, studies show that they reduce water heating expenses by 50% to 80%.

Tankless heaters can be paired with solar systems for optimal energy savings. A marriage of these two systems is considered one of the most environmentally-friendly methods available. Solar tanks can store heated water from their collectors, which can be used by the home tankless unit. The solar components will have a large up-front cost.

Tax Credits

Another factor that will affect costs is a reduction offered on solar-powered equipment. The government offers a 30% tax credit on the cost of installation for solar water heats. Find out more about the solar tax credit via Energy Star. You can also ask your installer about tax credits as well as manufacturer rebates.

Tankless Prices by Brand
A.O. Smith$600 - $4,000
Bradford White$500 - $2,000
EcoSmart$150 - $6,000
Rheem$200 - $2,000
Rinnai$500 - $4,300
Takagi$500 - $7,000

Choosing the Right Tankless Water Heater

"The benefit of the tankless is that you're preventing any liability from leaks. We go on calls all the time where your traditional tank heaters fail. Even the new ones, they fail because they're holding 50, 40, 100 gallons of water. If you're on vacation and that leaks, that causes significant damage. The benefit to the tankless is you're not going to have that."

Jim Schuelke, Owner, Twin Home Experts, Phoenix, AZ

These units don't come with gallon capacities like conventional tanks. So, how can consumers determine which one is right for them? For both gas and electric, the demand of water needed at one time, known as the flow rate, should be calculated.

Flow rate is calculated by measuring the gallons per minute (gpm). To find a flow rate, consumers should find out which appliances and fixtures are used at the same time and then add those figures together to determine the maximum gpm required. Check out the list below to figure out what tankless water heater capacity is best for you:

Average Water Usage for Common Household Features

  • Washing machine: 1.5-3.0 gpm

  • Shower: 1.0-2.0 gpm

  • Bathroom faucet: 0.5-1.5 gpm

  • Dishwasher: 1.0-2.5 gpm

  • Kitchen faucet: 3.0-9.0 gpm

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Pros and Cons of Hot Water Heaters vs. Tankless Units

Pros & Cons of Water Heater Boilers

  • More involved and expensive installation

  • Units more expensive

  • Take up more room

  • Better for larger spaces

Pros of Tankless Units

Cons of Tankless Units

DIY or Hire a Pro?

This is not a project for the average DIY homeowner. Many homes must be adapted to accommodate this system, which could require new wiring or gas lines, new piping and fittings, and possibly drywall reconstruction. Some localities require that this work be performed by a qualified professional. This is because of codes involving carbon monoxide emissions, thermal resistance, venting, and area-specific codes like earthquake straps in California.

Hiring an experienced plumber is the best route to go to ensure that you meet all the code and permit requirements. They can even make sure that you get the right equipment for your home.

It would be unfortunate to find that you've purchased an incompatible heater after the fact. Going with a professional guarantees quick and accurate work so your home isn't running on cold water while you wait for a plumbing permit.

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Are tankless water heaters worth the cost?

These models have a long payback period. They are projected to last 20 years, yet it will take about 20 years for your energy savings to equal the initial investment. Therefore, the value of these models depends on how useful they are to you and whether they will appeal to future home buyers. You can improve the return on your investment by choosing the right model for your consumption needs.

Are tankless hot water heaters better?

They are better than conventional models in several ways. They conserve water by heating as they go and they can lower home energy costs. They also last longer and require less maintenance because they are not storing water which can corrode tank material and cause leaks.

Do tankless hot water heaters work without electricity?

These units will not work if there is a power outage. Even gas models require electricity to control their spark igniter.

What temperature should you set a tankless water heater?

The Consumer Product Safety Commission recommends 120 degrees Fahrenheit for optimal safety and efficiency. Do not set your unit to a temperature greater than 140 degrees Fahrenheit.

What is the best rated tankless water heater?

Rheem and EcoSmart are two highly-rated brands. However, the industry is constantly evolving, and each home and family will have different needs. It's best to consult a professional about which is right for you.

How much water does a 20-minute shower use?

An average shower demands 2.5 to 3.0 gallons per minute, which puts a 20-minute shower at 50 to 60 gallons. These water heaters can typically produce 4 to 8 gallons of hot water per minute.