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On average, a tankless water heater should last between 10 and 15 years. Its lifespan will be affected by how much it's used, the effect of weather where your home is on the unit—colder is harsher and will shorten lifespan—and if the heater is maintained appropriately and regularly. There are many signs your water heater needs to be replaced, so pay attention to anything that changes with your heater or hot water.

If your gas water heater is over 20 years old, it should be replaced. Gas water heaters can last up to 12 years and while they can exceed this expectancy if well-maintained, a heater that's 20 years old would require replacement. The heater is unlikely to run as efficiently as a new model and could be more expensive to do so.

Most hot water heater manufacturers recommend replacing the anode rod about once every three to five years. Anode rods sacrifice themselves by collecting iron, limestone, and other minerals that would otherwise corrode your hot water heater tank. This abuse wears them out long before your water heater does. Check the rod when you remove it and replace it if more than 50% of the metal has been consumed. Check the rod more frequently if you have hard water or use a water softener. 

The average cost to install a new water heater is approximately $1,300, with a typical price range between $880 and $1,800. The final cost depends on several factors, including the type and size of the unit, its location and accessibility, and the amount of labor required. For example, installing a unit in a tight space like a crawl space can increase labor costs. The type of water heater significantly impacts the price: while a conventional gas heater might cost less than $1,000, tankless models can cost around $2,600 to install (and up to $3,500), and solar heaters can cost upwards of $3,700. Other factors that can affect the total price include the fuel type, vent system requirements, permits, and whether any additional plumbing work or repairs from previous water heater damage are needed.