How Much Does a Tankless Water Heater Cost?
By the HomeLintel Editorial Team · Reviewed 2026-08-24
A whole-home tankless water heater typically costs $2,800–$5,500 installed when converting from a tank unit, with simple like-for-like tankless swaps and small electric units landing lower. The unit itself is only part of the bill — conversion work is what moves the number.
Gas tankless units usually need Category III stainless venting or a condensing unit with PVC venting, and many homes need the gas line upsized to feed a 150,000–199,000 BTU burner. Electric whole-home units avoid venting but commonly require 100–150 amps of dedicated capacity, which older panels cannot spare.
Cost breakdown: gas whole-home conversion
| Item | Typical range | Notes |
|---|---|---|
| Tankless unit (gas, whole-home) | $900 – $2,300 | Condensing units cost more upfront, less to vent. |
| Labor (half to full day) | $800 – $1,800 | Wall mount, connections, commissioning. |
| Venting | $200 – $800 | Often eliminated or reduced with condensing PVC venting. |
| Gas line upsizing | $150 – $800 | Needed when existing line can't feed the burner. |
| Permit & inspection | $50 – $300 | Plumbing plus mechanical/gas in many jurisdictions. |
| Electrical (ignition/controls) | $0 – $300 | Outlet at the mounting location if absent. |
Is the efficiency worth it?
The US Department of Energy estimates on-demand water heaters are 24–34% more energy efficient than storage tanks for homes using under roughly 41 gallons of hot water per day, and 8–14% more efficient for high-use homes. Savings are real but modest in dollar terms — typically on the order of $100 or so per year — so the stronger financial case comes from lifespan: tankless units routinely last 20+ years versus 8–12 for tanks.
The practical benefits carry weight too: endless hot water at the unit's flow rating, no standby tank losses, no 50-gallon flood risk, and reclaimed floor space.
Gas vs. electric tankless
Gas units deliver higher flow rates — comfortably serving simultaneous showers in most homes — but carry the venting and gas-line costs above. Electric whole-home units are cheaper to buy and install where the panel has capacity, but a 27 kW unit draws more than many older 100–150 amp services can provide, and a panel upgrade adds $1,500–$4,000+ to the project.
Maintenance you should budget for
In hard-water areas, tankless heat exchangers need annual descaling (vinegar or citric flush) to hold efficiency and warranty coverage. DIY flushing costs almost nothing once you own the pump kit (~$150); professional service runs $150–$250 per visit. A water softener or scale filter upstream extends service intervals.
Frequently asked questions
Do tankless water heaters really provide endless hot water?
Yes, within their flow limit. A properly sized gas unit sustains its rated gallons-per-minute indefinitely — but exceeding that limit (three simultaneous showers on an undersized unit) drops the temperature for everyone.
How long do tankless water heaters last?
Typically 20 years or more with annual descaling, roughly double a standard tank's lifespan. Warranties on heat exchangers commonly run 10–15 years.
Can I convert from a tank myself?
Conversions involve gas sizing, venting, and pressure-relief work that is code-controlled nearly everywhere and unforgiving of mistakes. This is a job for a licensed plumber or gas fitter.
What size tankless unit do I need?
Size by peak simultaneous demand (add the GPM of fixtures used at once) and your groundwater temperature — the colder the inlet, the more BTUs needed per gallon. Northern homes need materially larger units than southern ones for the same fixtures.
Related resources
Sources & methodology
- US Department of Energy — Tankless or Demand-Type Water Heaters — efficiency ranges and suitability
- ENERGY STAR — Water Heaters — certified models and criteria
Cost ranges are HomeLintel editorial estimates built from the listed sources and our published assumptions — they are not quotes. Last reviewed 2026-08-24. See how we estimate costs.