Tankless vs. Tank Water Heater: Which is Right for You?

Tankless water heaters get all the hype. Tank heaters are still installed in most homes. Both have their place.

Tank water heater

Pros: Cheaper to install ($800-1,800), simpler to repair, all parts are common

Cons: 8-12 year lifespan, stores 40-80 gallons of heated water 24/7 (energy loss), can run out during heavy use

Tankless water heater

Pros: 20+ year lifespan, heats water on demand (no standby losses, never runs out), takes up much less space

Cons: Higher install cost ($2,500-5,000+), may need gas line or electrical upgrade, limited flow rate (heavy simultaneous use can max it out)

The math

Tankless saves $80-200/year on energy. Over 20 years that's $1,600-4,000 — usually enough to recoup the higher install cost, especially if you also factor in not paying for replacements.

When to pick which

• Pick tankless if: staying in the home 7+ years, household of 2-4, want endless hot water, have natural gas already
• Pick tank if: tight budget, small household, may move soon, or you have very high simultaneous demand