Whether building your home or a large-scale property manager, chances are you’ve heard of a tankless water heater. So what’s all the hype? Are they really worth it?

How tankless water heaters work

Tankless water heaters heat water directly without the use of a storage tank. When hot water is turned on, cold water flows through a pipe into the unit where an electric element or gas burner heats the water.

As a result, tankless water heaters deliver a continuous supply of hot water, which is ideal for filling a big bathtub or whirlpool. Because the supply is constant, you don’t need to wait for a storage tank to fill with enough hot water.

Tankless water heaters provide about 2-5 gallons of hot water per minute, with gas-fired tankless water heaters producing higher rates. Sometimes, however, even the largest gas-fired model cannot supply enough hot water for simultaneous, multiple uses. For example, running the dishwasher and taking a shower at the same time can stretch a tankless water heater to its limit.

To overcome this problem, you can install two or more connected tankless water heaters for simultaneous use. You can also install tankless water heaters for specific appliances – such as a utility sink or dishwasher.

Pros and cons of tankless water heaters


  • Saves money! The initial cost of a tankless water heater is higher than that of a conventional storage water heater, but tankless water heaters will last longer and have lower operating and energy costs. Depending on water usage, homes can save anywhere from 30 to 50 percent on energy costs.
  • Saves space! Tankless water heaters can fit on small areas, with some being little enough to mount onto outdoor walls!
  • Lasts longer! Almost doubling the life of a traditional water heater, tankless water heaters can last 8+ years!


  • Higher initial cost – Depending on the model, tankless water heaters can be anywhere from $2,800 to $4,500.
  • Retrofitting adds to upfront cost – Replacing a traditional water heater with a tankless system is more complicated, which can add to installation costs.

To tank, or not to tank?

For homes that use 40 gallons or less of hot water daily, tankless water heaters can be up to 34% more efficient than traditional water heaters. For homes that use 80 gallons or more, tankless water heaters can be up to 14% more efficient.

The best bet for saving energy is to install a tankless water heater at each outlet, raising the efficiency rate to 50%! Tankless water heaters can also avoid the standby heat losses linked to storage water heaters.

While the initial cost of a tankless water heater is greater than that of a storage water heater, the tankless water heaters will last longer and have lower energy and operating costs. Most tankless water heaters have a life expectancy of more than 20 years, and the parts are easily replaceable should a problem arise. On the contrary, storage water heaters last 6-8 years.

In short, if you can handle the higher initial cost, you will save money in the long run by choosing a tankless water heater. Schedule a water heater consult today!