Tankless water heater costs depend on the size of your water heater, location, fuel type, and more. Keep reading to calculate your expenses.
How Much Does a Water Heater Replacement Cost in Indianapolis? [2025 Data]
Normal Range: $1,039 - $2,423
The average cost for a water heater is $1,725 in Indianapolis, but it can range between $2,423 and $1,039. Your pro can discuss tank or tankless systems and if you need any additional plumbing upgrades.
How we get this data
Highlights
Your costs will depend mostly on whether you want a tank-style or tankless water heater, the unit size you need, and the fuel source you plan to use.
A combined 90% of homes in Indianapolis use natural gas or electricity for heating, and those that use electricity will pay more for their water heaters.
Tankless water heaters are becoming more common in Indianapolis, and while they’re more convenient and efficient, they cost nearly twice as much to install.
Make sure to have a professional size your water heater for your home for the best performance and unit longevity.
Water heater replacement costs in Indianapolis average $1,725, with most residents paying somewhere between $1,039 and $2,423. Your costs will depend on your fuel source, the size or output you need, and whether you want a tank-style or tankless water heater. Tankless water heaters are a popular option for Indianapolis residents who use natural gas for heat, but they’re twice as expensive as tank-style units.
Water Heater Replacement Cost Factors
Some homeowners in Indianapolis pay as little as $300 for a new water heater, but on the other end of the spectrum, prices can climb as high as $16,000. Where in this range your total falls will depend on a few key factors.
Size
Hot water heaters come in different sizes, measured by gallons (for tank-style systems) or gallons per minute (for tankless systems). The total amount of your water heater replacement cost will largely depend on the size of your new water heater, and that will depend on the size of your household.
The average household size in Indianapolis is 2.3 people, so most homes with tank-style water heaters will need a capacity of between 30 and 40 gallons, and those with a tankless water heater will need an output of between 6 and 10 gallons per minute (GPM) for sufficient hot water and good efficiency. Keep in mind that these numbers are just averages, and you should always have a water heater installation pro determine what size you need.
You can use the table below to get an idea of how much a tank-style water heater will cost based on the number of people in your home. There are other factors at play when it comes to tankless water heater costs, so get an estimate from a pro if you’re thinking about going tankless.
| Unit Size (Gallons) | Household Size | Average Cost |
|---|---|---|
| 30 | 1–2 | $900–$2,700 |
| 40 | 2–4 | $1,000–$3,000 |
| 50 | 3–5 | $1,000–$3,300 |
| 75 | 4–6 | $1,400–$5,200 |
| 80 | 6+ | $1,700–$9,800 |
Tank vs. Tankless Water Heaters
A traditional tank-style water heater stores water in a large tank that holds anywhere from 20 to 100 gallons. If you’re like 90% of households, you have a tank hot water heater sitting on a concrete pad in a basement, laundry room, or utility room. In comparison, a tankless water heater is the size of a small suitcase, has a coil system for heating water, and is usually mounted on the wall.
Most homes in Indianapolis have tank-style water heaters, but tankless systems are growing in popularity because they provide hot water on demand and waste less energy. However, while they’re more convenient, they’re also close to twice as expensive. If you’re not sure which is best for you, your water heater installation pro can help you decide.
| Tank-style | $780–$3,300 | More affordable | Energy efficiency |
| Tankless | $1,820–$5,100 | Operating cost | More expensive |
Types of Water Heaters
Most electric and gas water heaters cost between $550 and $1,500, but the type of water heater you choose will significantly impact your cost. A light-duty commercial heater is more durable but costs about $1,000 more than a residential unit. If you have an above-average home size with a large family, you may benefit from upgrading to a commercial unit.
Nearly 60% of homeowners in Indianapolis use natural gas as a heating source and will also have a gas connection available for their water heater. A little over 30% use electricity to heat their homes, and if you fall into that category, you’ll pay a little more for an electric water heater.
While gas water heaters are less expensive, they’re also more likely to be tankless because gas can heat water much more quickly for on-demand purposes. As such, you’re more likely to be able to go tankless if you use natural gas as a fuel source, which means a gas water heater could come with a higher average cost.
| Type | Average Cost |
|---|---|
| Electric | $780–$4,600 |
| Gas | $900–$3,500 |
| Propane | $900–$3,300 |
Plumber Pro Costs
Labor accounts for 50% of the total cost to replace a water heater, which means an average of $860 will go toward labor for your water heater installer in Indianapolis. On an hourly basis, this is right around what you’d pay in most other cities, as the cost of living in Indianapolis is just 1% higher than the national average.
The City of Indianapolis requires permits for any changes to the mechanicals in your home, so you’ll need a permit for water heater replacement. For homes under 2,500 square feet, which includes most residential properties in the city, the permit fee for water heater replacement is $153. If you have a larger home, expect to pay an additional $23 for every 1,000 square feet.
Your pro will also charge you sales tax, so be sure to account for this line item for the most accurate estimate possible. The sales tax rate in Indianapolis is 7%, including state and city taxes, so the tax will add an average of $120.75 to your total, given the average cost of water heater replacement in the city.
Safety Warning
To prevent carbon monoxide exposure from a water heater, make sure it is properly ventilated. You should also have it inspected and cleaned every year and install a carbon monoxide detector nearby. If you smell gas—which can mimic the scent of rotten eggs—evacuate immediately and call your gas company.
Do Water Heater Replacements Increase Home Value?
Any major update to your home's mechanicals can increase its value, as it will instill more confidence in buyers and could lead them to offer more for that added peace of mind. Since water heater replacement is a minor upgrade, though, the bump in home value will be minimal.
Since tankless water heaters are gaining popularity in Indianapolis, and since most homes have natural gas connections to accommodate a high-efficiency, gas-fired tankless water heater, you can maximize your return on investment (ROI) by upgrading to tankless.
A study from Zillow suggests that this upgrade could add 1.2% to your home value, which means an average bump of nearly $3,100 in Indianapolis. The added cost of a tankless water heater could be worth it.
How Angi Gets Its Cost Data
Home is the most important place on earth, which is why Angi has helped more than 150 million homeowners transform their houses into homes they adore. To help homeowners with their next project, Angi provides readers with the most accurate cost data and upholds strict editorial standards. We’ve surveyed over 30,000 real Angi customers about their project costs to develop the pricing data you see, so you can make the best decisions for you and your home. We pair this data with research from reputable sources, including the U.S. Bureau of Labor Statistics, academic journals, market studies, and interviews with industry experts—all to ensure our prices reflect real-world projects.
Want to help us improve our cost data? Send us a recent project quote to [email protected]. Quotes and personal information will not be shared publicly.
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