How Much Does a Hot Water Heater Cost?
3 pros!
The average cost to buy a water heater is $1,190.
You might call it a hot water heater or simply a water heater; either way, water heater installation is one of the most common (and important!) home improvements. Hot water heater replacement costs range from $810 to $1,570, and the price depends on whether you have a simple one-for-one swap or a detailed upgrade to a tankless system.
How Much Does It Cost to Buy a Hot Water Heater?
To estimate the cost to replace a water heater, think in terms of buying the unit itself, plus the time your professionals need to install it. Water heaters cost $300 to $2,000 for the unit, and labor fees run from $45 to $150 per hour. The average length of the installation visit is two to three hours—if the plumber doesn’t have to make updates, such as a conversion from an electric to a gas system.
The Average Cost of Hot Water Heaters with Installation
- Tank: $900 for a 40- to 50-gallon tank
- Tankless: $3,000
Additional Hot Water Heater Costs
Hopefully, all you’ll need is an easy water heater exchange—out with the old, in with the new. But some homeowners need extra services to make the switch correctly. Residential water heater rules change from time to time, often requiring updates. But try not to stress about these code updates—it’s all about safety.
Your plumber will let you know the code requirements (and might refer to other local professionals such as an electrician), especially if you want to convert between gas and electric or prefer to move the water heater’s location.
These are the average costs for hot water tank installation services you might need for your project:
- Electrician: $50–$100 per hour
- Additional wiring: $550–$2,200
- New gas line: $250–$800
- New water line: $350–$1,900
- Required permits: $100–$1,500
- Wall Framing: $200–$400
- Drywall installation: $1,000–$2,900
- Water heater removal: $100–$500
How Much Does It Cost to Buy a Hot Water Heater Near You?
Hot water heaters sit pretty high on a homeowner’s must-have list! Americans pay differently across the country for their long, hot showers:
The City or State Average Cost Range
- Atlanta: $775–$1,350
- Austin, TX: $850–$1,650
- Atlantic City, NJ: $1,129–$1,635
- Boston: $992–$1,841
- Chicago: $750–$1,250
- Dallas: $950–$1,675
- Denver: $985–$1,900
- Houston: $950–$1,600
- Los Angeles: $950–$1,750
- Minneapolis: $715–$1,300
- San Diego: $935–$1,600
- San Francisco: $1,050–$1,850
- Seattle: $1,050–$1,700
How Much Does It Cost to Buy a Hot Water Heater By Type?
Water heaters have two styles: tank and tankless. Both types use either gas (natural or propane) or electricity to produce hot water.
A traditional tank water heater stores water in a large tank that holds anywhere from 30 to 80 gallons. If you’re like 90% of households, you have a tank hot water heater tucked away in a basement or laundry room. A tankless water heater is the size of a small suitcase and has a coil system for heating water.
Gas Water Heater Costs vs. Electric Water Heater Costs
On average, natural gas units cost $100 to $200 more than electric units and operate less efficiently. But if electric bills run high in your city, the gas option is a cheaper choice long term. If you live in an apartment or a small space, electric water heaters (either tank and tankless) perform best because they don’t need various forms of venting.
Gas Water Heater
- Cost over a 12-year lifespan: $5,000
- Price of the unit: $250–$1,800
Electric Water Heater
- Cost over a 12-year lifespan: $6,250
- Price of the unit: $200–$2,880
Average Cost of a High-Efficiency Water Heater
Even though you use the water heater daily, you probably don’t know it's the second-highest source of energy consumption in your home (an HVAC ranks first). Buying a high-efficiency water heater is an economical and environmentally-friendly choice.
High-efficiency water heaters cost an average of $1,000 to $3,000, including the unit and labor. They are 100% to 300% more efficient than standard water heaters, and boast improvements such as quality insulation, plastic tanks, and smart controls that detect leaks.
Tankless Hot Water Heater Costs
If you decide the cost of a tankless water heater is a good long-term investment, you’ll pay more upfront (about $1,000 to $3,000) but you’ll recoup the money in energy savings over its 20-year life. Tankless heaters offer an extra perk—on-demand hot water, no waiting involved, perfect after a cold day of skiing.
But take note: this isn’t a DIY project. Installing a tankless water heater is best left to local professional installers because of the gas lines, electricity, and venting involved.
Solar Water Heater Costs
Watch any “off the grid” home building show, and you’ll see a solar water system. This system saves the owners money over time, but the initial expense is high. Solar water heater installation costs between $1,800 and $5,500, but can jump to $13,000, depending on the model, installation costs, maintenance, and the availability of a knowledgeable contractor.
Hybrid Heat Pump Water Heaters Costs
If you’re not concerned about space or expense, a hybrid heat pump water heater is the way to go. This is the most expensive option: you’ll pay $1,200 to $3,500 because hybrid water heaters rank as the most energy-efficient. But small homes aren’t the best candidates (sorry, tiny-house owners) because the water heater needs 7 feet of clearance from the floor to ceiling, plus 1,000 cubic feet of surrounding air.
Indirect Water Heater Installation Costs
A versatile and efficient choice, indirect water heaters cost $800 to $1,500. The flexibility to use multiple energy sources—gas, oil, propane, electric, solar, or any combo of these—from a nearby source is the top-selling feature.
What Factors Influence the Cost of a Hot Water Heater?
Hot water heaters need plenty of room to operate best. If you’ve been thinking about clearing the basement with a yard sale, there’s no better time than to make room for a new water heater. Gallon size is another factor that influences unit and installation costs.
Location of the Hot Water Heater
Most homeowners buy a water heater only after the existing one gives out, most likely during an inopportune time—like if you have houseguests who prefer hot showers. Chances are, your hot water heater needs an upgrade or location change.
Sometimes homeowners want to move the hot water heater’s location to save space or make room for other renovations. If you choose a tankless unit, the installation location could also change. This could mean additional costs for new venting, plumbing, or small carpentry projects to house the water heater correctly.
Water Heater Sizes
The number of people in your home is the best estimate for what size water heater you’ll need. To dial into specifics, calculate your first-hour rating (FHR), aka peak hot water demand, and your tank's recovery rate.
For example:
Function X Peak Use During One Hour = Gallons Used in One Hour
Shower (10-gallon average) X 3 per hour = 30 gallons
Tank Water Heater Measured by Gallons
- 1 person: 20–30 gallons
- 2–3 people: 30–40 gallons
- 4–5 people: 40–50 gallons
- 6+ people: 55 gallons+
Tankless Water Heaters Measured by Gallons Per Minute
- 1 person: 20–30 gallons, 2–3 minutes
- 2–3 people: 30–40 gallons, 3–5 minutes
- 4–5 people: 40–50 gallons, 4–6 minutes
- 6+ people: 55 gallons+ 5+ minutes
(Photo By © brizmaker/ iStock / Getty Images Plus/Getty Images.)
FAQs About Water Heater Costs
What should I consider when buying a hot water heater?
Even though most people wait until the last minute, you should consider buying a hot water heater if you start to see the telltale signs of impending failure, keeping in mind the lifespan of a standard tank water heater is eight to 12 years.
Here are some warning signs:
- Metallic taste
- Rusty or discolored water
- Water doesn’t heat enough, only warms
- Noisy pops and cracks
- Leaks
How do I find a professional to install my hot water heater?
You’re looking for a qualified, local, and licensed plumber with experience installing the type of unit your home needs. Not every contractor or plumber has the skills to install every system. Ask each pro directly if they have experience working with your situation, especially if you need the expertise for an electric to gas conversion or a complicated tankless or solar heater system.
