How Much Does It Cost to Install a Water Heater?

A water heater is an essential appliance in any home, serving to heat water for things like bathing, showering, cleaning, and cooking. They come in various shapes and sizes, including tank and tankless models, as well as electric and gas-powered heaters. The size, type, and functionality of a water heater all have an impact on its price, and homeowners should consider all their options before making their decision on which water heater to purchase.

On average, installing a water heater costs $600-$1,500, with the average customer paying $1,000 to install a whole-house, 50-gallon tank water heater for a 4-5 person household.

Water Heater Costs

Water Heater Costs by Type

There are several types of water heaters, including standard tank heaters, tankless heaters, hybrid heaters, and solar-powered heaters. They vary in size and functionality, but all do the same basic thing: heat your water. The total cost of your heater varies depending on the type you buy, and different types can be easier to install and maintain and have varying lifespans and features. All the heaters, except solar heaters, can be powered electrically or by gas, and the power source also has an effect on the final price. The table below shows the four main types of water heaters, along with their average prices.

Tankless Water Heater Cost

A tankless water heater is one that does not have a large tank to store the hot water. Instead, they heat the water as you use it, making them more energy-efficient overall. One of the advantages of a tankless water heater is that it is much smaller, taking up less room in the house and being easier to install. Buying a tankless water heater costs between $200 and $1,200 on average.

Tank Water Heater Cost

A tank water heater is the most traditional kind of water heater, found in many homes around the world. These heaters come with a large tank that stores and heats the water in advance, allowing you to turn on the shower or faucets and slowly drain the hot water out of the tank. On the plus side, they provide a large supply of hot water instantly, but on the downside, the tank needs to be refilled after emptying. Costs for tank heaters range from $340 to $1,500, on average.

Solar Water Heater Cost

A solar water heater uses solar power, taken from the sun, to heat the water. They come in various types and sizes and are one of the most expensive heaters you can buy and install. However, they can save you money in the long run by using a renewable and eco-friendly energy source. Solar water heaters cost between $600 to $3,000.

Hybrid Water Heater Cost

A hybrid water heater, also known as a hybrid heat pump heater, is one of the most efficient forms of water heaters. They work by using a heat pump to essentially pull heat out of the surrounding air and transfer it to the water via coils and a compressor. They are very good at heating water without using too much energy, but they are also very large and expensive units, costing between $1,200 and $2,500.

Electric Water Heater Cost

Heaters are usually powered by either gas or electricity. Electric heaters tend to be cheaper than gas heaters. They require less maintenance and are often more eco-friendly but are not quite as efficient overall, and the installation can be more complicated. Electric heaters cost from $200 to $3,000.

Gas Water Heater Cost

Gas heaters have the advantage of being usable when the power goes out. They can run off natural gas, regular gas, heating oil, or propane, so you can choose between different fuel sources, depending on accessibility and prices in your area. The running costs of gas heaters tend to be lower, but they are less eco-friendly. Gas water heaters are usually more expensive, costing between $400 to $3,000.

Water Heater Cost by Gallon

Tank water heaters can be found in a range of different sizes, from relatively small 30-gallon models to much larger 80-gallon units. The smaller models are better for smaller homes with just one or two people, while larger families need bigger water heaters to provide sufficient hot water for all of their daily showers and other needs. The table below shows average prices for water heaters of different capacities.

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30-gallon Water Heater Cost

A 30-gallon heater is a good choice for a home with 2-3 people, but it can also be a good option for people living on their own. The average cost for a 30-gallon heater is between $300 and $900.

40-gallon Water Heater Cost

A 40-gallon heater is a good choice for a home with 3-4 people and should provide enough hot water for the typical small family. The average price range is from $350 to $1,500.

50-gallon Water Heater Cost

A 50-gallon water heater is best suited for homes with 4-5 people, catering nicely to families with 2-3 children. The average cost is from $400 to $2,300.

75-gallon Water Heater Cost

If you have a larger family with over 5 members, a 75-gallon water heater is one of the best options. This size has sufficient power to handle multiple showers and faucets running simultaneously, costing between $800 and $3,000.

80 Gallon Water Heater Cost

For those with the largest households and families with 6+ members, an 80-gallon water heater may be the right option. With a huge tank, this heater meets the needs of big families and costs between $1,000 and $3,200.

Labor Costs to Install a Water Heater

As well as the material costs of the heater itself, you also need to consider the labor costs to install the water heater. The prices vary greatly depending on which plumber you contact and what type of heater you are installing. Plumbers typically charge $45-$150 per hour. Some heaters can be installed in just a couple of hours, while others require a full day, with prices ranging from $150 to $3,500. Some heaters are very difficult to install, so the prices are much higher, with tank heaters usually being the simplest and solar heaters being the most complicated and expensive. The table below shows you the average labor and total project costs for each kind of heater.

Water Heater Replacement Cost

If you already have a water heater in place and need to replace it with a new one, the costs vary depending on what type of heater you have installed and whether you are replacing your current heater with one of the same type and size. For example, replacing an electric tank heater with another electric tank heater will be a much simpler and cheaper job than replacing it with a completely different model. In general, replacing a water heater costs between $500 and $2,000 when replacing the same kind of heater. When replacing a different kind, the price varies from $600 to $3,500. Additional costs include things like installing new wiring, gas lines, and plumbing, obtaining permits for any necessary construction, and carpentry costs if new walls or spaces need to be built.

Tankless vs Tank Water Heater

One of the first decisions you have to make when buying a water heater is whether you want a tank or tankless model. Both types of water heaters have advantages, and their prices vary depending on factors like the tank size and the flow rate of the tankless model you choose.

Tankless (or “instant” or “on-demand”) systems are often considered more energy-efficient because they only heat water when needed. However, some homeowners and consumer groups argue that tankless heaters are not always the best option because of their maintenance requirements and sometimes inconsistent water supply. Tankless heaters also tend to be more expensive ($590-$700 installed for a tank system and $1,140-$1,500 installed for an equivalent tankless system) and can be more difficult to service. They are not always the best option for those who use lots of water simultaneously, such as a shower, washing machine, and faucet all running at the same time. You can save money in the long term with a tankless heater, using between 24% to 34% less energy on average.

Tank water heaters have a larger reserve of hot water, meaning you can use it for multiple tasks at once, like taking a shower and washing dishes without any interruption in the supply. They are usually less expensive to install and maintain than tankless heaters and easier to repair as well, although they end up costing more each year in energy costs. Tank water heaters also tend to provide hot water more quickly than tankless systems. On average, a 30-gallon heater is good for a household of 2-3 people, a 40-gallon heater is good for 3-4 people, and a 50-gallon heater is good for 4-5 people. For a house with 5 people, a 75-gallon electric system or a 50-gallon natural gas or propane 1 system should be sufficient.

Gas vs Electric Water Heater

Another big decision to make when buying a water heater is choosing between a gas and an electric model. You can find both tank and tankless heaters powered by gas or electric, with many models to choose from in both categories. Both gas-powered and electric heaters have advantages and disadvantages, as well as specific price ranges.

Gas water heaters tend to be more expensive initially but can save you money in the long run because their running costs are usually lower. They are also regarded as more efficient in terms of heating water quickly, and you can also buy high energy-efficient models. You can use a gas heater even when the power goes out, but there are additional safety concerns and maintenance issues associated with gas heaters. Expect to pay anywhere from $1,300 to $2,600 for a 40-gallon gas heater installed.

An electric water heater is cheaper initially but may have higher monthly costs, depending on the energy prices in your area. An electric heater runs the risk of being useless when the power goes out and does not heat water as quickly as a gas heater. But they require less maintenance, have fewer safety concerns, and have lower levels of energy loss. Expect to pay between $950 and $1,500 for a standard 40-gallon electric heater installed.

Direct Vent vs Power Vent Water Heaters

Water heaters can also be divided into two other categories: direct vent and power vent. The difference between these two types of heater concerns the ways they deal with exhaust gases produced from burning fuel. With a direct vent heater, the exhaust gases are vented out via an exhaust pipe or chimney. With a power vent heater, there is a fan or blower that aids in the removal of the gases.

If there are no exhausts or chimneys, a power vent might be the only option, and they allow you to install your water heater in a wider range of locations. Direct vent systems are simpler and cheaper. For a power vent system, you need to spend an additional $500 to $1,000 in materials and installation costs because additional wiring is usually needed. Direct vent systems do not usually cost anything extra.

How to Determine What Size Water Heater You Need

Many homeowners are not sure which size heater they need for their homes, and with so many options and capacities available, it can be tricky to figure out which size water heater you need.

This can be made more complicated when choosing between tank and tankless systems because they have different ways of measuring size and capacity. A tank system is measured in gallons, which refers to how many gallons can be stored in the tank at one time. A tankless system is measured in gallons per minute (GPM), which shows how many gallons of hot water it can provide per minute. The table below should help you find the right size for your home.

Whole house systems require more power and a larger space to operate. They also tend to be more expensive than single point systems, although that cost is used to provide hot water to the entire house. A 1,500 square foot home system averages $600-$800.

Historically, single point systems were for tankless systems, although there are more options now. Single point systems tend to be more efficient because the water doesn’t have to travel as far before reaching its destination, giving it a smaller chance of heating unnecessary water and water losing its heat as it travels through long pipes. Single point systems are smaller and less expensive, as low as $200-$400.

Signs You Need a New Water Heater

Many water heaters are designed to last for 10 years or more, but as time goes by, they can start to break down and eventually need to be replaced. Rather than having to deal with a sudden breakage and all the stress, it makes sense to keep an eye on your water heater and look out for warning signs that it might be close to the end of its life. Here are common signs to look for:

• Rusty Water - If your water begins to have a rusty or strange color, that is a sign that the heater is suffering corrosion.
• Strange Taste - If the water has an odd metallic taste, this may also be a sign of corrosion inside the heater.
• Cold Water - If your water is not heating or seems to be less warm than usual, it is likely that your heater’s heating element may be broken or in the process of breaking down.
• Strange Noises - Any popping or cracking sounds from the heater could signify the heating element is breaking down.
• Leaks - Leaks from the heater are a serious concern and may represent a major internal failure. If you notice any leaks, shut down the power to the system, and call in a professional.
• Old Age - If your heater is 10+ years old, there is a good chance that it will not last much longer. Start thinking about a replacement.

Best Location for a Water Heater

There is always a risk of a water heater leaking, which makes its location even more important. A water heater should be placed somewhere it won’t cause major damage if it leaks, such as a storage room or garage. Water heaters need to be accessible for maintenance and should have 12-18 inches clearance on all sides.

Water Heater Expansion Tank Cost

An expansion tank is like a special safety system you can add on to your water heater. It offers additional space for water that expands as it heats, and many modern building codes require an expansion tank to be installed with new heaters. Without this extra space for the water to flow into, pipes may burst as the pressure builds up. Expansion tanks cost between $100 and $350 installed.

How Much Does It Cost to Convert a Gas Water Heater to Electric?

If you already have a gas water heater system in place and want to convert it to an electric one, you need to cover the costs of new electrical wiring and circuits. In general, converting a gas water heater to electric costs between $250 and $600.

How Much Does A Water Heater Permit Cost?

In many places, permits are required for a new water heater, especially if you are changing the type of system. Check with your contractor or plumber for information specific to your area. Permits have a wide price range, from $100 to $1,000 or more. The price depends on the type and scale of work that needs to be done.

Enhancement and Improvement Costs

Back Up Hot Water System

Homes with solar water heaters may need a backup hot water system for when the solar system can’t get enough sunlight to work. On average, a standard backup system averages $200-$300.

Flat Plate Solar Collectors

Flat plate solar collectors collect more heat and are a good option for larger heating projects, such as heating swimming pools. They start at around $7,000.

Energy-efficient Water Heaters

Energy-efficient water heaters come in a variety of types and styles. On average, a water heater with an energy-efficient label costs 10%-20% more.

Replacing and Resealing Vents

If you have a gas water heater, it is necessary to vent the system. There are a variety of vents that you can choose, depending on the configuration and type of heater you are using. If you have a sealed-combustion unit, such as in a tiny home or trailer, it does not vent to the outdoors; all other types will vent outside and require sealing to prevent energy loss and inflated utility bills. Replacing and resealing the vents is commonly done by plumbers at a cost of $45-$150, per hour, and takes about one hour to fully install a single vent. The vents cost an average of $30 at most home improvement venues, though your plumber will typically bring along and charge for this part.

Additional Considerations and Costs

• Saving tips. Many homeowners save money by purchasing the water heater on their own before installing it instead of purchasing a package deal of the water heater and installation services.
• Disposal. Removing and disposing of an old water heater can add up to $500 to the overall cost.
• Warranty. Most water heaters come with a warranty that averages 8-12 years in length.
• Pipes. Water heater pipes average $8-$10 per linear foot, although old piping may still be compatible in many cases.
• Reducers. When replacing an existing vent, you may find that the opening to the outside is not the size you need for your new vent. Try to find and purchase vents that are similar in size, when possible, and know that when there is a subtle difference (an inch or less), you may use a ‘reducer’ with some aluminum tape and sheet-rock screws to seal the gap. The installation of these reducers is usually included in the labor costs for your new hot water heater, and the reducer itself is cheap, around $5 each.
• Power vents. If you do not vent your system to the outdoors, you may choose an electrical fan-style vent, called a power vent. Power-venting your hot water heater costs at least $500 more, half of which is materials and approximately $300 more for labor costs from an electrician.