Tankless vs Tank Water Heater Costs: What Homeowners Should Know

When considering the installation of a new water heater, homeowners must first decide whether a tankless or a traditional tank water heater would better suit their needs and budget. In addition to considering the benefits offered by each type of water heater, it’s also important to consider the cost of each option. In this guide, we will analyze tankless vs tank water heater cost factors to assist you in determining which choice is best for your situation.

 

Understanding the Difference Between Tankless and Tank Water Heaters



Before exploring the costs of each type of water heater, it’s important to first clarify the difference between a tank and a tankless water heater. A tank water heater, which is also often referred to as a traditional water heater, is the most common option. This unit, which is a storage water heater, stores and heats a specific amount of water inside the tank. The water is then maintained at a constant temperature, ensuring it is available whenever needed.

 

By comparison, a tankless water heater, which is sometimes called an on-demand water heater, only heats water when it is needed. This eliminates the need to maintain a large storage tank, which can save space.

 

Each type of water heater offers distinct advantages; however, when deciding which option is the right choice for your home, it’s important to consider the needs of your home along with long-term goals and budget. Beyond the initial cost of the unit, it’s also a good idea to consider additional costs, such as possible maintenance expenses and energy consumption.

 

Upfront and Ongoing Cost Comparison

 

In the process of deciding which water heater is the right choice, many homeowners are often concerned with the upfront cost of the unit. When it comes to tankless vs tank water heater cost, the least expensive option is usually a tank water heater. Homeowners can anticipate a standard 40- to 50-gallon tank water heater to cost between $800 and $2,500. The exact cost depends on both the brand of the appliance as well as the complexity of the installation process.

 

The price of a tankless unit can range between $2,000 and $4,500. The cost of a tankless water heater is often higher than a standard tank water heater due to the fact that a tankless unit utilizes advanced technology. There is also often a need for additional installation tasks, such as electrical work or venting. This can be particularly common when installing a tankless unit in an older home.

 

Exploring Other Tankless vs Tank Water Heater Cost Factors

 

While the upfront installation cost is certainly a factor to consider when exploring whether a tankless or a standard tank water heater is the best choice, there are also other factors that should be considered, as well.

 

Among those factors is the anticipated monthly energy bill. One of the benefits a tankless water heater offers over a tank water heater is efficiency. A standard water heater typically loses heat as the water is stored in the tank. This results in higher energy bills. By comparison, a tankless water heater produces water on demand rather than storing heated water. This reduces energy consumption by as much as 30 percent, allowing homeowners to save money on their monthly electric or gas bills.

 

Maintenance costs are another factor that should be taken into consideration. The amount it costs to maintain a water heater can vary. At Quality Plumbing, Heating, Cooling & Electrical, we recommend that a standard tank water heater receive flushing on an annual basis. Flushing is necessary to remove sediment, which can lead to corrosion inside the tank, the need for repairs, and possibly early replacement of the unit without annual maintenance. A tankless unit requires descaling periodically. The frequency with which a tankless unit needs to be descaled can range between one to two years.

 

Convenience Factors of Tankless and Standard Water Heaters

While cost is certainly an important factor, homeowners should also consider factors related to convenience and performance. One of the major selling points of a tankless water heater is that it provides a continuous stream of hot water. With an unlimited supply of hot water from a tankless unit, homeowners never have to worry about running out of hot water while taking a long shower or while running two appliances at once. With a tank water heater, it’s easy to quickly run out of hot water. Once the supply of a standard water heater has been depleted, you likely must wait thirty minutes to an hour for it to reheat. For homes with a high demand of hot water, including those with large families, the unlimited supply of hot water offered by a tankless water heater can be a major advantage.

 

Lifespan of the unit is also an important consideration. A tank water heater will usually last between 8 and 12 years, while a tankless water heater often has a lifespan lasting up to 20 years with proper maintenance.

 

The space-saving benefit offered by a tankless unit is another critical advantage for many homeowners. Due to the compact design and the fact that a tankless unit can be wall-mounted, it is often a preferred choice for many smaller homes. There is no need for a tankless water heater to have its own dedicated space, such as in a utility closet.

 

The Bottom Line

Tankless water heaters do come at a higher upfront cost than a standard tank water heater, but a tankless unit offers greater energy savings and a longer lifespan. By comparison, a tank water heater is often initially less expensive, but may involve a greater cost over time due to the need for an earlier replacement and increased energy usage. Ultimately, homeowners need to consider the size of their household, hot water demand, and long-term planning for their households. If you are considering installing a new water heater, contact us at Quality Plumbing, Heating, Cooling & Electrical to schedule a consultation. We would be happy to help you determine which type of water heater is best for your home.