How Much Does Water Heater Replacement and Installation Cost? [2024 Data]
Normal range: $880 - $1,786
The average cost for a water heater is $1,309, but it can range between $880 and $1,786 depending on whether you go with a tank or tankless system and need any additional plumbing upgrades.
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. There’s a huge range of hot water heater replacement costs—you’re paying for materials and labor, and the price for each can vary wildly based on a few things.
If you’re planning on replacing or upgrading your water heater, you can use this comprehensive cost guide to help you set your budget.
- Average
- $1,309
- Low end
- $350
- high end
- $12,000
Water Heater Replacement Cost Factors
Water heater replacement costs range from $880 to $1,786, with the average cost being $1,309. Your total price depends on whether you’re doing a simple one-for-one swap or a detailed upgrade, like to a tankless system. Additional cost components include the water heater's size and labor costs.
Tank vs. Tankless Water Heaters
A traditional tank-style water heater stores water in a large tank that holds anywhere from 20 to 100 gallons. If you’re like 90% of households, you have a tank hot water heater sitting on a concrete pad in a basement, laundry room, or utility room. In comparison, a tankless water heater is the size of a small suitcase, has a coil system for heating water, and is usually mounted on the wall.
Tankless models are rising in popularity because of their efficiency and durability. Unfortunately, high-end models can cost twice as much as a conventional tank water heater. For a replacement, expect to spend $600 to $2,500 on a tank-style water heater or $1,200 to $3,500 on a tankless water heater. However, investing in a tankless water heater means you’ll recoup the money in energy savings over the unit’s 20-year life.
If you’re converting a tank system to a tankless system, you may pay significantly more for labor because the job can take twice as long and include replumbing to the appropriate mounting area.
Keep the ongoing maintenance for the unit in mind when making a decision. For example, the cost to repair a tankless water heater is usually higher than what you’d pay to repair a tank water heater, often between $220 and $975. Repairing a tank heater usually costs between $100 and $500. Still, the pros of a tankless water heater typically outweigh the drawbacks.
"Many homeowners invest thousands in upgrading their water heaters to tankless systems but are never informed about the importance of regular maintenance," says Jeff Botelho, Angi Expert Review Board member and Massachusetts-licensed journeyman plumber.
Although repairs are expensive, you should still always call a tankless water heater repair service near you for a solution, as a DIY job is complicated and can lead to severe damage if you make a mistake.
Size
Hot water heaters come in different sizes, measured by gallons (for tank-style systems) or gallons per minute (for tankless systems). Again, tank-style heaters hold anywhere from 20 gallons to 100 gallons. The larger the tank, the more it’s going to cost. Here are some common prices by tank size, including parts and labor.
| Hot Water Heater Size (Gallons) | Average Cost |
|---|---|
| 30 | $550 – $2,100 |
| 40 | $550 – $2,100 |
| 50 | $650 – $2,400 |
| 75 | $1,250 – $3,500 |
| 80 | $1,350 – $3,500 |
The number of people in your home is the best factor to consider when deciding which size water heater you’ll need. Start by calculating your first-hour rating (FHR)—a.k.a. 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
For a two- or three-person household, a water heater that holds 40 to 50 gallons—or heats 3 to 5 gallons per minute—is usually adequate. Larger families will need a larger tank but be careful not to purchase a water heater that’s too big for your household, as running it will cost you more over the unit’s lifespan.
Fuel Type
When you install a hot water heater, costs are dependent on the type of fuel the unit runs on. Natural gas, propane, and electric water heaters all start at around $600—but costs rise from there. A high-end electric water heater is the most expensive type and can cost as much as $3,500, excluding hookup or installation. You’ll pay significantly more if you need to install a gas line or electrical wiring to switch the type of fuel you use. Keep in mind that converting to a more efficient fuel type could save you more than the unit costs over time on your utility bills.
You’ll also find high-efficiency, indirect, solar, and hybrid heat pump water heaters, which we describe in-depth in the next section.
Venting System
Electric water heaters generally don’t need venting, but gas or propane water heaters do. There are two types of venting: direct or power. Direct-vent heaters, which use a passive venting system, are less expensive and use an exhaust pipe or chimney. Power-vent heaters are more expensive and use a fan or blower plus electricity.
In general, expect to spend an additional $300 to $600 on a power-vent unit, plus $300 to $500 for the electrical work.
| Venting System | Venting Route |
|---|---|
| Direct | Exhaust pipe or chimney |
| Power | Fan or blower; costs $500 – $1,000 more than other options |
Materials
A typical water heater installation project will call for materials like piping for gas and water, venting pipes, solder, thread compound, connectors, pressure valves, etc. Your water heater installation pro may need extra materials in unique cases. If you’re converting from a tank heater to a tankless heater, your installer may also need to install blocking in the walls or additional studs to support the brackets and the tank for a safe installation. These can push up your material costs as well.
Labor Cost to Install Water Heater
Labor is a significant part of a hot water heater replacement—usually accounting for around 50% of your total—but costs vary based on how long the job takes. In general, plumbers cost $45 to $200 per hour, while electricians cost $50 to $100 per hour. Expect the following average price ranges for labor alone:
Replacing a tank-style water heater: $150–$450
Replacing a tankless water heater: $600–$1,850
Converting a tank-style water heater to a tankless system: up to $2,500
Labor may also vary depending on the cost of living where you live and the pro’s experience level.
Permits
Permits for a hot water heater replacement usually cost between $25 and $300, depending on the extent of the work and your local laws. At the very least, you’ll need a permit to install a gas appliance or alter plumbing and electricity. Permits for connecting your home to natural gas before the water heater replacement cost an additional $50 to $300. This is one area where installing a gas vs. electric water heater is less expensive in most cases.
Brand
Like with many other home systems, the brand of water heater you choose can play a role in your overall water heater cost. For example, a Rheem water heater averages $1,000, while an A.O. Smith® averages around $1,950. Below are some water heater brands and their average cost.
| Water Heater Replacement Brands | Average Cost |
|---|---|
| Rheem® | $600 – $2,300 |
| A.O. Smith® | $800 – $3,500 |
| Bradford White® | $400 – $3,000 |
| Kenmore® | $350 – $1,000 |
| Whirlpool® | $350 – $1,500 |
Location
You’ll spend more on water heater installation costs if you’re replacing a water heater in a difficult-to-reach area. For example, it will cost more if your contractor has to carry the unit up or down multiple staircases or maneuver it into tight areas.
Relocating your water heater also costs more, falling at about $150 to $3,400, depending on the complexity of the move. 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.
Your geographical location will also play a role, as labor costs in more expensive areas are usually higher to keep in line with the cost of living. The chart below provides some average water heater replacement costs in some of the largest cities in the U.S.:
| City | Average Water Heater Replacement Cost |
|---|---|
| Austin, TX | $1,300 |
| Chicago, IL | $1,600 |
| Dallas, TX | $1,400 |
| Houston, TX | $1,300 |
| Los Angeles, CA | $1,900 |
| New York, NY | $1,800 |
| Philadelphia, PA | $1,500 |
| Phoenix, AZ | $1,300 |
| San Antonio, TX | $1,100 |
| San Diego, CA | $1,900 |
Water Heater Replacement Cost by Type
Most electric and gas water heaters cost between $550 and $1,500, but the unit type will significantly impact your cost. A light-duty commercial heater is more durable but costs about $1,000 more than a residential unit. Here’s what you can expect for each type of water heater.
| Type of Water Heater | Average Cost (Materials and Labor) |
|---|---|
| Electric | $600 – $3,500 |
| Gas | $700 – $2,700 |
| Propane | $700 – $2,500 |
| High Efficiency | $1,500 – $3,000 |
| Indirect | $1,200 – $3,500 |
| Solar | $1,700 – $5,500 |
| Hybrid Heat Pump | $1,200 – $3,500 |
Electric
Best for: Small apartments
Electric water heaters typically cost $600 to $3,500 to install. These units are relatively more wallet-friendly up front, and you can purchase a small electric water heater for a single appliance for as little as $200. Keep in mind that this type of unit requires a 240-volt connection. If you don’t have one near your water heater, you’ll spend an additional $300 to $800 on installing a new electrical circuit.
Overall, electric water heaters perform best in apartments and small spaces because they don’t require various forms of venting. They’re a little bit safer than gas-powered water heaters because there’s no risk of a gas leak, but the total cost to use your water heater will fluctuate with local electricity prices. Luckily, they’re around 95% energy efficient.
Pros:
Safer than gas or propane models
Lower up-front costs (doesn’t require extensive venting)
Simpler to operate and manage (no pilot light)
Relatively simple for a pro to install
Heats water more efficiently than gas models
Available in point-of-use (POU) or whole-house units
Cons:
Heats water slowly
Long recovery time
Higher operating costs (depending on local electricity prices)
Doesn’t work during a power outage
Costs can increase if you don’t have a 240-volt connection
Gas
Best for: Areas with high electricity costs
Natural gas water heaters cost an average of $700 to $2,700 to replace. They’re one of the most common types of water heaters and tend to heat water more quickly than electric units.
Unfortunately, they cost $100 to $200 more than electric units and are less energy efficient. Depending on the average cost of utilities in your city and the current price of gas, you could find yourself stuck with high operating costs. But if electric bills run high in your city, a gas option could be less expensive in the long run.
Pros:
Heats water quickly
Works during power outages
Lower operating costs compared to standard electric units (depending on local gas prices)
Cons:
Not all homes have natural gas hookups (you may have to run a new gas line)
Installation costs increase if you need venting
Relatively high maintenance, which comes with additional costs
Less safe and efficient than electric models
Shorter lifespan
Propane
Best for: Rural or inaccessible areas
Propane water heaters cost an average of $700 to $2,500 to replace. This type of unit is an alternative to natural gas. You’ll commonly find them in rural areas without accessible natural gas lines or homes that are off-grid (think: a mountain cabin or island property).
While it’s a great solution in those instances, a tanked propane water heater tends to cost slightly more than a traditional water heater and requires more maintenance since you’ll need to get regular propane deliveries. They also aren’t as safe as electric heaters because propane is highly flammable. Propane units do carry a risk of explosion and carbon monoxide leaks, though the risk is low if they’re properly installed and maintained.
Pros:
Heats water quickly
Lower operating costs compared to electric models
Longer lifespan than traditional electric or gas models
Available in POU or whole-house units
Great solution for off-the-grid areas without accessible gas lines
Works during power outages
Cons:
Slightly higher cost for the unit
Requires extra maintenance
Requires regular propane deliveries
Less safe than electric heaters
High Efficiency
Best for: Energy savings
It costs an average of $1,500 to $3,000 to install a high-efficiency water heater, but costs can rise depending on the type. These units can be two to three times more efficient than a traditional tank water heater and boast improvements such as quality insulation, plastic tanks, and smart controls that can detect leaks. In other words, they come with a higher up-front cost, but you can save on utilities and repairs over time.
Even though you use your water heater daily, you probably don’t know it's the second-biggest energy hog in your home (behind the HVAC). Buying a high-efficiency water heater is an economical and environmentally-friendly choice.
Pros:
High energy efficiency
Low operating costs
Environmentally friendly
POU or whole-house options
Solar and electric types are safer than traditional gas or propane units
Cons:
Higher up-front installation costs due to specialty features
May run out of hot water more quickly than traditional options
May have a slower recovery time
May struggle to heat water in colder weather
Indirect
Best for: Flexible fuel source
Indirect units cost an average of $1,200 to $3,500 to install but tend to be the most budget-friendly to use. The top-selling feature is the flexibility to use multiple energy sources—gas, oil, propane, electric, solar, or any combo of these—from a nearby source.
"Indirect-fired heaters use a coil inside the tank that connects to a boiler with piping, similar to a heating zone," says Botelho. "The heat radiating from the coil heats the water inside the tank. These tanks are more expensive than traditional gas or electric tanks and take about four to eight hours to install."
Pros:
Extremely efficient, particularly in cold climates
Low operating costs and quick recovery time compared to traditional tank units
Flexibility to use multiple energy sources
Can save money by installing a combination water and space heating system
Cons:
Can be inefficient in warmer climates
May have higher installation costs if you need to upgrade your boiler
May require more maintenance in areas with hard water
Natural gas units are less safe than electric options
Solar
Best for: Energy efficiency in sunny climates
The typical price of a solar water heater is $1,700 to $5,500, including labor. Costs can rise to as much as $13,000, depending on the model, installation costs, maintenance, and availability of a knowledgeable contractor. These units are a more costly option upfront because you’ll need to install solar panels, but they don’t really cost anything to run beyond regular maintenance—so long as the sun shines.
There are two main types of solar water heaters: active heating systems and passive heating systems. Active systems that circulate water using a pump are the most efficient and expensive. Passive systems, which rely on gravity rather than a pump, are less efficient and less expensive.
Pros:
Lowest possible operating costs
Environmentally friendly with zero emissions
Less maintenance (as little as every three to five years)
Long lifespan (up to 20 years)
Cons:
High up-front installation costs (requires solar panels)
May struggle during stretches of cloudy skies
Requires a backup water-heating method
May not be available without roof access
Heat Pump
Best for: Energy efficiency in garages or basements
On average, a heat pump (or “hybrid”) water heater costs $1,200 to $3,500 to install. This type of unit pulls in heat from the air and uses a compressor or coil to transfer the heat to water stored in a tank. Generally, it works best in temperatures above or around 40 degrees Fahrenheit, but split-type heat pump water heaters will work in temperatures as low as minus 25 degrees.
All in all, heat pump water heaters are extremely efficient. Unfortunately, they need 7 feet of clearance from the floor to ceiling and 1,000 cubic feet of surrounding air, so they’re not a good option for small homes and apartments.
Pros:
High energy efficiency
Low operating costs
Environmentally friendly
Split-type heat pump water heaters are great for colder climates
Extra efficient in rooms with high heat, like furnace rooms
Cons:
Costs 30% to 40% more than a traditional water heating system
May struggle to meet a home’s water demands, especially in colder months
Space requirements make it a poor choice for smaller homes
Additional Water Heater Installation Costs to Consider
In the simplest replacement, a pro will swap out your old hot water heater for a similar model. The installation will usually be simple because the new unit already fits in the space. This isn’t the case for all installations, though. In some cases, you’ll need additional work, which will lead to extra costs.
Hiring an Electrician
If you have to do any extra electrical work, expect to spend $50 to $130 per hour to hire a licensed electrician. This expense may be particularly high if you’re upgrading to an electric tankless model. These units use 120 to 160 amps, so you might have to upgrade your electrical service to 200 amps or more.
Additional Wiring
If you're converting from one fuel source to another, you’ll often need additional electrical wiring. Most homeowners spend $500 to $1,000 installing a new electrical line and a sub-panel if necessary, and total electrical wiring costs can be upwards of $2,300.
New Gas Line
Gas line installation costs an average of $260 to $820, but you can spend upwards of $1,500 switching from an electric water heater to a gas water heater. The gas line transports gas from the outdoor supply system to your unit.
Most of the time, if you’re replacing an old gas water heater with a new one, you can use your existing gas line. However, you may need to install a new gas line if:
You’re moving the location of your water heater.
You’re switching from an electric water heater to a gas water heater.
You’re installing a brand-new gas water heater.
Your existing gas line is damaged.
New Water Line
If your water heater installation requires a new water line, expect to spend an additional $400 to $2,000. You may need a new water line if you’re relocating your water heater, you’re installing additional POU water heaters, or your existing water line is damaged.
Expansion Tank Installation
Installing a water heater expansion tank costs $90 to $350. This is often a requirement in new construction and advisable in areas with freezing winters.
Water expands when it’s heated and when it freezes. If you’re using a traditional tank water heater and have a closed plumbing system, this expansion can potentially damage your plumbing and put stress on your pipes—particularly when numerous appliances start at once or there’s a spike in demand. A water heater expansion tank will literally take the pressure off.
Warranties
Some water heaters come with a manufacturer’s warranty, but your contractor may offer additional coverage that further protects your investment for about $100 to $300. Sometimes the added coverage even includes free inspections. Check the warranty of your current water heater to see if it covers repairs or replacements.
Wall Framing
The job may require extra carpentry work if you’re installing a new water heater or relocating your current unit. Expect to spend $200 to $400 on the price of framing a wall for a water heater installation.
Drywall Installation
Sometimes, a contractor needs to open up a wall to properly install a replacement water heater or run the plumbing and electrical lines necessary for the installation. The typical drywall installation cost is $1,000 to $3,000 or $1.50 to $3 per square foot.
Water Heater Removal
Removing your old water heater and hauling it away typically costs $100 to $500, depending on your contractor’s hourly rate. If the water heater is in an inaccessible area or it’s difficult to remove, costs will push toward the high end.
Disposal Fees
You might have to pay an additional cost to dispose of your old water heater. If you’re removing it yourself, consider taking it to a recycling company or scrapping it. If the unit still works, you might be able to sell it. Otherwise, check with your contractor, as sometimes the cost of your new water heater installation includes the disposal fees. Local dumping fees will play a role in most cases.
Water Damage
A flooded basement is one of the most unfortunate ways to discover you need a new water heater—but sometimes things happen. Generally, water damage repair costs $3.75 to $7 per square foot, with the average homeowner spending $1,300 to $5,550, and prices can push even higher if you need to pay for mold remediation. A local water damage restoration service can diagnose the severity of the issue and start making repairs.
Signs It’s Time to Replace a Water Heater
The average water heater lasts about 10 years, though certain high-efficiency models can last more than 20. Either way, you’ll eventually need a replacement. Luckily, severe water damage usually isn’t the first sign that your water heater is about to fail. If you know the signals, you can replace your unit before it causes a major problem.
Discolored Water
Traditional tank water heaters have an essential component known as an anode rod. As you use your water heater, this rod erodes and releases electrons that protect your tank from rust and corrosion. When the rod fails, you’ll notice rusty or cloudy water coming out of the tap when you run hot water, as the inside walls of the tank are corroded. Sometimes you can replace the anode rod, but other times, you’ll need to replace your water heater.
The Tank Is Leaking
You may notice a few drips or a tiny pool beneath your water heater. Make no mistake—a leaking tank is nothing to mess with, and it’s often a precursor to a full-on flood. It’s one of the more obvious signs that cracks and fissures have developed in your tank, so call a local water heater repair service ASAP and get ready for a replacement if the professional deems it necessary.
The Tank Is Making Loud Sounds
If your water heater is unusually loud, it’s time to schedule a home plumbing inspection. Generally, a failing water heater doesn’t go quietly. Over time, minerals and sediment build up inside the tank, creating air pockets. As the water heats up, the air releases and makes a popping, banging, or rumbling noise. Ongoing noises could mean major damage and that a replacement is necessary.
You’re Running Out of Hot Water
A failing hot water heater won’t efficiently heat water. This problem often starts slowly and snowballs—meaning the water gets cold quickly. You may notice you’re running out of hot water faster than you did in the past, and it’s taking a lot longer to heat back up once you’ve run out. Sometimes a water heater element replacement can remedy this problem, but it might be worth replacing the whole unit.
You Don’t Have Any Hot Water
If you don’t have hot water at all, that’s an obvious issue—but an ice-cold shower isn’t the only thing that points to a failing water heater. A lukewarm shower is also a red flag, although some water heaters will struggle to heat up water in freezing weather. If tepid water continues, no matter how hot you turn the tap, it’s best to bring in a pro.
Metallic Taste
If you notice your hot tap water has a metallic taste, it's possible the metal from your water heater is leaking into your plumbing system. While this could signal that your water heater has irreparably corroded and will most likely leak, sometimes it also means you missed regular maintenance. If it’s the latter, draining your water heater—which you should do every year or so—may remove the funky taste. Otherwise, you may need to replace the unit.
Increased Energy Costs
If you notice your energy costs increasing, it could mean your water heater is struggling. This can happen as parts wear down, but sometimes resetting the thermostat can solve the issue. Set your thermostat between 120 and 140 degrees Fahrenheit. If resetting the thermostat doesn’t resolve the problem, call in a pro to diagnose the issue.
Cost to Install or Replace a Hot Water Heater Yourself
Flatly put, it’s not a good idea to install a water heater on your own—nor is it even legal in most cases. Since this project involves water and either gas or electrical lines, you’ll need a permit to do any work. Your city, state, or homeowner’s association will typically only grant permission to a licensed plumber or contractor.
There might even be insurance requirements. Regardless of the legalities, the list of what can go wrong is enormous. Something as simple as over-tightening a gas control valve can cause a gas leak and lead to a fire or carbon monoxide poisoning. For this job, skip the potential hazard and hire a water heater installer near you.
DIY vs. Hiring a Pro
DIY water heater installation is an advanced project that most homeowners shouldn't take on themselves. In most cases, it's best to hire a professional water heater installer. Typically, pro water heater installation costs $850 to $1,700, including the heater itself. Depending on the complexity of the installation, you’ll generally spend anywhere from $150 to $2,500 or more on labor. Still, this is one job where hiring a professional is well worth the investment.
How to Save When Replacing Your Water Heater
Replacing a water heater is often an emergency expense, so it’s not exactly the most budget-friendly project. Fortunately, there are a couple of ways you can save a little money on hot water heater costs while installing this must-have appliance.
Repair, Don’t Replace
Water heaters have a typical lifespan of six to 20 years, depending on the model and how well it’s maintained. If your water heater isn’t nearing the end of its average lifespan, you can try repairing it instead of replacing it. Water heater repair costs range from $100 to $1,300, and it could be a simple fix if you need something small like a valve replacement. For example, replacing a gas valve on a hot water heater costs between $100 and $200, plus the price of the part.
Stick With the Same Type of Water Heater
If you need to replace your water heater, reduce installation costs by replacing it with a similar model. This mostly eliminates the expenses of switching fuel sources—like installing new electrical wiring, gas lines, water lines, and plumbing—as long as your hookups are in good condition. However, for long-term savings, you might want to consider upgrading to a gas or solar water heater, or to a tankless water heater if yours currently has a tank.
Purchase Your Water Heater Directly
Instead of buying your hot water heater through your contractor, purchase it directly. This typically saves some money—but only if you can safely tote it home from the store. Not every homeowner has a large enough car to transport a water heater, so if this is the case, save yourself the hassle and buy it through a pro.
Schedule Replacement for Off-Peak Times
Some contractors charge more to work after hours or on weekends or holidays. You can usually save some money by scheduling a weekday replacement during typical work hours. That said, water heater replacements often come with a sense of urgency. Avoiding a costly, same-day service might be worth a couple of cold showers—but not if your water heater is flooding your basement.
You can also preemptively replace your water heater in the spring or summer, where the emergency demand for replacements is lower.
Frequently Asked Questions
Tank-style hot water heaters need replacing about every six to 15 years, while a tankless model can last 20 years or more. Over time, water heaters fill up with sediment that can start causing issues. If your unit is 10 years old, start thinking about a possible replacement. Flushing your tank-style water heater annually and having routine maintenance done can increase the lifespan of the unit.
The time it takes to replace a water heater depends on the complexity of the job. Expect your contractor to spend:
One to three hours on a standard tank-style water heater replacement
Two to three hours on a tankless water heater replacement
Four to six hours replacing a tank-style water heater with a tankless water heater
One hour for each additional parallel or point-of-use water heater
Your project will take longer if you’re switching fuel sources, upgrading to tankless, or relocating your water heater.
Electric or gas tank water heaters are the most budget-friendly water heaters to install. Most of the time, these water heaters cost between $550 and $1,500. Higher-end models or models with large tanks can cost more. Keep in mind that costs will rise if you need to install a new gas line or 240-volt electrical circuit, so go with what best suits your existing space.
It typically costs somewhere between $650 and $2,400 to replace a 50-gallon hot water heater. Though 40-gallon tanks are the most common, 50-gallon tanks better accommodate households with four to five people and heat 3 to 5 gallons per minute. You can keep costs down by replacing your water heater with the same type and size, as this will require fewer changes to the surrounding area, including plumbing, electrical lines, and concrete pads.
Replacing an older water heater that requires frequent repairs is almost always worth it. If your fixture is nearing the end of its lifespan—around 10 to 20 years, depending on the model—replacing a water heater might save you money in the long run. Replacing a water heater generally costs less than repairing a fully-flooded basement, and some high-efficiency units pay for themselves thanks to energy savings. Plus, installing a new water heater and upgrading to tankless will boost your home value and make your hot water more readily available, improving comfort for your family.