Average Costs to Replace a Water Heater

New Hot Water Heater Installation Prices

Most standard electric and gas water heaters cost $400 to $1,600, not including labor. However, they can range anywhere from $300 to $3,000 depending on several factors, including:

Tank vs. Tankless

Average cost with installation:

• Tank - $889 (40 to 50 gallon tank)
• Tankless - $3,000

Water heaters come in two different styles: tank and tankless. A storage tank style, as the name implies, keeps hot water ready to use in a large tank. Tankless water heaters cost two to three times a standard type. But this smaller, on-demand style gives you an endless supply whenever you need it through a series of super-heated coils.

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Water Heater Costs by Gallon

*Does not include labor costs to install.

Gas Water Heater Costs vs. Electric Water Heater Pricing

All types use gas (natural or propane) or electricity. On average, natural gas fired units cost $100 to $200 more than electrical types. The internal heating comes either from an electrical coil, much like a stove top coil or via a gas flame.   Although natural gas units cost more up front with lower energy-efficiency, the high price of electricity still makes gas the cheaper long-term choice. However, electrical types, tank or tankless, make better choices for small apartments or confined areas since it doesn’t require make-up air or venting.   Here are some other points of comparison between the two:

Propane vs. Oil-Fired Hot Water System Prices

Propane and oil-fired water heaters both fall on the expensive end of the spectrum at $1,000 to $3,000 for the unit alone. Propane and oil-fired types offer an alternative to electricity and natural gas for rural and off-grid homes.

Direct Vent vs. Power Vent Water Heaters

Power venting a water heater costs about $500 to $1,000 more than a passive or direct vent system.

• Power venting: Adds $300-$600 to the unit’s price. Plus, you’ll add an additional $300-$500 for wiring and electrical. This system uses a powered fan to push exhaust air out of your home. Natural and LP gases create carbon monoxide as they burn, creating a potentially serious health hazard if not vented properly.

• Passive or Direct Vent: Adds $500-$1,000 only if you’re converting from electric to gas. This system uses the idea that hot air rises over the cooler surrounding air. As the gas burns, the air heats up and vents out of your house through a vent stack above the unit.

Solar Water Heaters

Solar water heater installation costs $1,800 to $5,500 but can skyrocket to $13,000 or more. Some people supplement their system with a solar tank or tube style heater. While these can help increase what’s available for your family, they are also very expensive. 

Average Cost of a High-Efficiency Water Heater

High-efficiency water heaters cost an average of $1,000 to $3,000 including the unit and labor. They’re anywhere from 100%-300% more efficient than standard types.   These come in both tank and tankless types. They use a combination of factors to create better energy efficiency, which include:

• Better insulation
• Smart controls with leak detection and protection alerts for connected devices
• Heat pumps (discussed in the next section).
• Plastic tanks

Hybrid Heat Pump Water Heaters

You’ll pay in the range of $1,200 to $3,500 for most hybrid heat pump water heaters. This price includes both the materials and the labor. They’re the most efficient style of tank storage and the most expensive.   These use a heat pump to pull heat from the surrounding air and transfer it to the water in the tank via a compressor and coils. While the most efficient option available but don’t make a good choice for small apartments.  

Indirect Water Heater Installation Costs

Indirect water heaters cost $800 to $1,500 on average. An extremely efficient choice, they use a tank that pulls heat from a boiler or furnace rather than having an independent heat source. They’re basically just a tank you place next to your furnace. Pipes are then run through the furnace and coiled inside the tank. It pulls heat from your boiler, indirectly heating the water.  

Rheem Water Heater Prices vs. Other Popular Brands

The costs above are estimates for the unit only. They are for the common 30 to 50 gallon capacity units and do not include installation, transportation, or other additional costs.

Average Labor Cost to Install a Water Heater

Labor costs for installing a standard water heater range from $150 to $800. Most plumbers quote a flat rate that includes the materials and labor. But if you bought your own unit and want it installed, you’ll need to consider calling in a pro:

• Hiring a plumber costs $45-$200 per hour with most jobs taking 2 to 3 hours.
• Hiring an electrician costs $50 to $100 per hour. You’ll need one to add a circuit or convert from gas or propane.

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Water Heater Replacement Cost

Replacing a water heater usually costs $500 to $1,800 for a replacement of the same style and size. Other costs can add anywhere from $50 to $1,500 or more, including permit fees, expansion tanks and carpentry work.

• Converting from one fuel source to another including gas, oil, propane or electric means adding new lines, pipes and electricity.
  • Adding electrical wiring fees: $500-$1,500.
  • Water line installation costs: $350-$1,000.
  • Gas line addition price: $250-$800.
• Permits: $100-$1,500. Depends on the type and extent of the work you’ll do.
• Expansion tanks: $40-$350. These are often required in new construction or when updating.
• Carpentry work. You might need to frame a new wall, enclose or open a space or simply drywall in a utility closet.
  • Framing a wall costs: $2-$4 per square foot.
  • Drywall installation costs: $500-$700.

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

It’ll cost you $200 to $500+ to convert from gas to electric. The total cost comes from running a new electrical circuit. They must have their own dedicated circuit so don’t try to put them on an existing line.

How Much Does A Water Heater Permit Cost?

Water heater permits cost $50 to $500 depending on the extent of the construction needs. You can pull a permit yourself or have your installer do it as part of the project fees.  

Water Heater Expansion Tank Cost

A water heater expansion tank costs $40 to $200 with labor adding another $50 to $150. Most come with a little extra space for fluid expansion as it heats up. It’s usually required by code with new construction or when upgrading your current system.   Without that space, the hot fluids build up pressure which ultimately can lead to burst pipes. An expansion tank gives a little extra space to take the pressure off your pipes.

Water Heater Removal Costs

Removing your current water heater cost anywhere from $100 to $500. The bill depends heavily on the hourly rate of your contractor. But it it’s hard to access or difficult to remove, expect to pay for it.

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Cost data is based on actual project costs reported by HomeAdvisor members.  

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How Big of a Water Heater Do You Need?

Most often, you’ll determine the size of your water needs based on how many people you have in your home. Consider the following household sizes to determine your needs:  

*May require two or more units run parallel or with separate units for point of use, such as a dedicated one for each bathroom, shower or appliance.   For a detailed estimation you’ll need more information:

• Tank style heaters: you’ll want to find your FHR (First Hour Rating) or the peak-hour hot water demand and your tanks recovery rate.
• Tankless: You’ll need to know the flow rate of each appliance, fuel source and the rise in temperature needed.

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Signs You Need a New Water Heater

Do you need a new water heater? Here are some easy ways to find out. Some may require a little periodic checking while others become obvious only after things have gone wrong.  

• Water is rusty or discolored or there’s a strange metallic taste. This means the anode inside has failed and the heater is corroding.
• It isn’t heating up enough.
• Not getting hot at all. While this could indicate the pilot, light is out or the circuit breaker has been tripped, it can also indicate a failure of the whole heating system.
• Loud pops and cracks. These noises indicate that the heating element is failing.
• Leaks. This indicates major failure going on internally. Shut off the electricity or gas to the system and let it cool down before replacing it.
• Over 10 years old: It’s nearing the end of its life expectancy.

When it comes time to replace your unit, it’s best to call a professional. This way you can be sure that everything has been done safely and to code.

DIY vs. Hiring a Plumber to Replace a Water Heater

A water heater is a must in your home. As technology advances, the efficiency of these systems will increase. It’s tempting to save a few hundred by installing one yourself. But you’ll need to deal with pipes, gas lines or electrical.

FAQs

How much does a hot water tank cost?

It’ll cost you anywhere from $300 to $2,000 for a hot water tank style heater.

What type of water heater is best for small homes or studio apartments?

Small families and studio apartments can often use a 20 gallon electric or tankless water heater (if the apartments are on individual units).  

What is an expansion tank, and do I need one?

An expansion tank is a safety system for water that expands when it heats up. Most have a little room inside for expansion. However, any system can fail. In this case, the expanding water flows into the expansion tank rather than your pipes. Yes, you need one. Many codes now require installing one with new construction. Without a safe place for the expanded water to go, in a worst-case scenario, your pipes burst from the pressure.

How much does it cost to run a water heater?

Water heater usage costs $150 to $700 per year. It makes up 14% to 20% of your total household energy use.

How much do water heater services cost?

Water heater repairs cost $200 to $1,000. The actual bill depends heavily on what work you have done, if you have a tank or tankless and the fuel source you use.

How long do water heaters last?

A tank style water heater lasts 8 to 15 years. Tankless has a 20+ year lifespan.

How do you know if your water heater is going out?

When you notice your hot water runs out quicker than normal or it begins to taste metalic, you know your water heater is going out.

How long does it take a 40 gallon water heater to drain?

It’ll take about 20 to 30 minutes to completely drain a 40 gallon water heater.

How long does it take for a water heater to heat up 50 gallons?

A 50 gallon water heater can take anywhere from 1 to 2 hours for electric or 30 to 60 minutes for gas to heat water to 120 degrees.

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