The 5 Biggest Myths About Tankless Water Heaters

Allie Ogletree
Written by Allie Ogletree
Updated July 30, 2021
Woman washing her hands in the sink
Suteren Studio -

Know the facts before you make the swap

Get quotes from up to 3 pros!
Enter a zip below and get matched to top-rated pros near you.

Tankless water heaters are all the rage, and for good reason. They appeal to all walks of life—from the home hunter to the conservationist to the frugal spenders. It’s no wonder, seeing as you get better efficiency and endless hot water with a unit that doesn’t occupy much more space than a large suitcase.  

With all of these perks in mind, it may seem like a no-brainer to invest in a tankless water heater. At the same time, you might have expectations and reservations that should be addressed before you decide to go tankless.

Below are five common myths that every homeowner considering a tankless water heater should know.

1. Tankless Water Heaters Are More Expensive

While tankless water heaters cost more upfront than conventional water heaters, the energy savings make them more cost-effective in the long run.

Here are a few cost factors to consider before going tankless:

  • Cost of the tankless water heater: First and foremost, you’ll want to look at the cost of tankless water heaters. On average, expect to pay a minimum of $150 for a low-end electric tankless water heater that can heat a single point, like an individual faucet or appliance, and around $1,500 for a gas-fired tankless water heater for an entire house. A solar panel tankless water system can run between $1,800 and $5,500.

  • Cost of installation: The cost of installing your tankless water heater may turn out to be more expensive than that of a traditional water heater. Depending on your location and the complexity of your installation, expect to pay around $3,000 to install a tankless water heater. Compare that to a traditional heater, which costs between $600 and $1,500 to install.

  • Cost of energy usage: Gas-fired tankless water heaters can save you an estimated $108 per year on energy bills, while an electric tankless water heater can save you around $44 a year. Tankless water heaters also have a lifespan of 20 years, which is 5 to 10 years longer than traditional heaters. This means you can save approximately $2,160 and $880, respectively. Not to mention, their parts are easier to replace.

Though the cost to purchase and install a tankless water heater is much more expensive than a conventional water heater, the amount you save over time can’t be beat. An added bonus: going tankless means your home’s market value increases.

2. Tankless Water Heaters Are ‘Plug and Play’

Tankless water heaters are not just a simple “swap out” of your conventional gas water heater. In fact, many conventional water heaters weren’t installed with a tankless retrofit in mind. Your home’s gas piping, gas meter, and gas line leading out to the meter may not be the appropriate size for your new, tankless water heater.

One Size Doesn’t Fit All

Most electric and conventional natural-draft water heaters vent exhaust differently from tankless water heaters. Most tankless options vent horizontally through a side wall, as opposed to the traditional galvanized vents that emit exhaust air through the roof. 

So, if you’re expecting your tankless water heater to easily replace that old conventional gas unit, don’t be shocked to find that it’s not as simple as removing the old appliance and putting in that new, energy-efficient upgrade. You might find yourself needing to spend extra on the installation costs to obtain the perfect tankless water heater for your home.

Man testing water temperature of bathroom sink
Maridav -

3. Tankless Water Heaters Deliver Hot Water Faster

Somehow, “instant” has replaced the word “tankless” in the minds of many homeowners. But when you make the swap, you don’t actually get hot water to your faucet any faster. If it took a long time before, it will still take a long time to get there—unless that issue was specifically addressed.

The type of tankless water heater you choose also makes a difference. For example, some tankless heaters will only fire up when they sense flow. In this case, there can be additional seconds of wait time before hot water reaches a faucet. In other instances, a tankless water heater is located in a completely different location than the old water heater. The farther the heater is from the faucet, the longer the water takes to get there.

If water does take a long time to get to a faucet, you can add a circulation system to your water’s heat source. Luckily, some tankless models are designed so a circulation system can be added without reconfiguring piping or adding an additional buffer tank. 

Be on the lookout for models that have a circulation system requiring minimal reconfiguration if you are concerned about how long it will take for your water heater to heat and transfer water throughout your home.

4. All Tankless Water Heaters Are the Same

Throughout the years, tankless water heaters have become more reliable, cost-effective, and, in some cases, easier to install. But, of course, some brands are better than others for certain applications. 

There are now models that offer more firepower while keeping equipment and installation costs down. Other types are less reliable and have very poor product support. Some also require more extensive maintenance than others, which should be considered when evaluating the cost of ownership. 

And remember: No matter the quality of the unit, if it’s not installed correctly, you will always get poor performance. 

So, how do you find out which brands are best? 

A great resource is a reputable local plumbing pro or HVAC company near you. Most likely, they’ll want to keep their customers happy with good services and superior products. Take a look at the brands the company uses as you research the best products for your tankless water heater.

5. Replacement Doesn’t Require a Permit or Inspection

Though we can’t speak for all jurisdictions, many areas do require a permit or inspection. If you’re not sure if it’s required, call up your local permitting office. They may require a mechanical permit, gas piping permit, and/or electrical permit, depending on the local jurisdiction and the work required to install the new appliance. 

Safety First

Remember, when you replace a 40,000 BTU tank with something that uses up to 199,999 BTUs of gas, it produces exhaust and carbon monoxide. It also vents completely differently from the old appliance. An improperly installed unit may not only underperform but be a safety hazard as well. 

So, for your safety and health, it is best to follow the local authority’s requirements for permits and inspections. Also, adhere to routine inspections and maintenance to ensure that your water heater is functioning properly.

Before you change to a tankless water heater, make sure you know all of the facts and have separated them from the many myths that you may have come across. When in doubt, seek out a reputable plumbing/HVAC company to help you make a well-informed decision that will hopefully meet your needs and expectations. 

Need professional help with your project?
Get quotes from top-rated pros.