New Hot Water Heater Installation Prices

New hot water heater installation costs range from as low as $550 to $10,000 or more, including the unit and labor. Most standard electric and gas water heater units cost $400 to $1,600. However, they can range anywhere from $250 to $6,000, depending on the type. Installation costs vary significantly based on type as well.

Tank vs. Tankless

Average cost with installation:

• Tank: $900 (40- to 50-gallon tank)
• Tankless: $2,250

Water heaters come in two main styles: tank and tankless. A tank water heater, as the name implies, keeps hot water ready to use in a large tank that holds anywhere from 30 to 80 gallons. More than 90% of water heaters installed in U.S. homes are tank-style.

Tankless water heaters cost two to three times more than standard tank heaters. They’re harder to install and will run you more in labor costs. The advantage with these small, suitcase-sized units is that they deliver an endless supply of hot water whenever you need it through a series of super-heated coils. You might hear them referred to as “on-demand” heaters.

Water Heater Prices by Gallon

*Does not include labor costs to install.

Gas vs. Electric

All types use either 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 pilot light. Although natural gas units cost more up front and they’re less energy-efficient, the high price of electricity in most parts of the country still makes gas the cheaper long-term choice. However, electrical types, whether tank or tankless, make better choices for small apartments or confined areas since they don’t require make-up air or venting.

Propane vs. Oil-Fired Systems

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 propane gases create carbon monoxide as they burn, creating a potentially serious health hazard if not vented properly.
• Direct venting: 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.

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% to 300% more efficient than conventional water heaters. 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

Solar Water Heaters

Solar water heater installation costs $1,700 to $5,200 on average 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.

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 heater and the most expensive. They 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. Heat pumps are large units, requiring as much as seven feet from clearance from floor to ceiling, plus up to 1,000 cubic feet of surrounding air space, so they‘re not a good choice for small houses and apartments.

Indirect Water Heaters

Indirect water heaters cost $800 to $1,500 on average. An extremely efficient choice, they consist of a tank that pulls heat from a nearby boiler or furnace, rather than relying on an independent heat source. The systems can be fired by gas, oil, propane, electric, solar energy or any combination of these.

Water Heater Prices by Brand

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 expenses.

Average Labor Cost to Install a Water Heater

Labor costs to install a standard water heater typically range from $150 to $800. Most plumbers quote a flat rate that includes the materials and labor but if you already bought your own unit, you may pay hourly rates for your pro. Hiring a plumber costs $45 to $200 per hour and electricians cost $50 to $100 per hour.

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, including permit fees and carpentry work, can add anywhere from $50 to $1,500 or more.

• Converting from one fuel source to another often includes one or more of the following:

• Adding electrical wiring fees: $550-$2,300
• Water line installation costs: $350-$1,900
• Gas line addition price: $275-$825
• 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: $200-$400.
• Drywall installation costs: $1,000-$2,900.

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

It will cost you $200 to $500 or more to convert from gas to electric. The total cost comes from running a new electrical circuit. Electric heaters require 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 and include it in their overhead.

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 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 costs anywhere from $100 to $500. The bill depends heavily on the hourly rate of your contractor. If the unit is hard to access or difficult to remove, expect to pay more for removal.

Water Heater Installation Cost by Location

Cost estimates are based on actual project costs reported by HomeAdvisor members.

What Size Water Heater Do You Need?

Determine the size of your water needs based on how many people you have in your home.

*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: find your FHR (First Hour Rating) or the peak-hour hot water demand and your tank's recovery rate.
• Tankless: determine the flow rate of each appliance, fuel source and rise in temperature needed.

Signs You Need a New Water Heater

About 90% of hot water heater installations are the result of a sudden failure, according to the American Council for an Energy-Efficient Economy. You can avoid the stress of that situation by watching out for the following warning signs that your water heater is nearing its end of life:

• Water is rusty or discolored or there’s a strange metallic taste. This means the anode inside has failed and the heater is corroding.
• Water isn’t heating up enough. Likely an issue with the main heating element.
• 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 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 electricals.

You’ll also need a permit and inspection. If anything fails, the cost of repairs, cleanup or updating an improper installation might end up costing more than hiring a pro in the first place. If you want to save money on this project, look for multiple water heater installation companies near you today. Compare rates, reviews, and get multiple quotes before you hire.

FAQs

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 tank 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. 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 costs range from $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 $225 to $1,000. The actual bill depends heavily on what work you have done, if you have a tank or tankless unit, and the fuel source.

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

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

It takes 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.