How To Estimate Water Heater Replacement Cost?



A reliable and efficient water heater is a cornerstone of modern living. It provides us with the comfort of hot water for various daily activities. However, like any other appliance, water heaters have a limited lifespan and eventually need replacement. An aging water heater may become less efficient and lead to increased energy bills and a reduced hot water supply. It could also lead to leaks or even complete breakdowns, resulting in inconvenience and water damage. In this blog post, we will explore the method to estimate the water heater replacement cost, the expense to replace different types of water heaters, factors that affect the replacement cost, and many more. In between, the cost of water heater installation falls between $500 to $3,000, with an average of around $1,000, covering labor, materials, and the unit itself.

How to Identify You Need Water Heater Replacement?

Water heaters usually last 8 to 12 years, while some can last longer. As they get older, they might not work efficiently or stop working completely. But there are signs to watch for signs that show your water heater is not doing well. If you see rusty or strange-tasting water, or if there are leaks, you might need a new water heater. Also, if the water does not get hot enough or you hear odd sounds from the heater, it is time to get it checked by a professional. If your water heater is more than 10 years old, start planning to get a new one soon, since older ones can suddenly stop working without warning.

Factors Involved in Water Heater Replacement Costs

When you are planning to replace your water heater, there are some important things to consider.

  1. Types of Water Heaters

    The first thing to decide is what type of water heater you want. There are two main types: tankless and tank-based systems. Tankless water heaters heat water only when you need it. Tankless water heaters can last longer than tank-based ones. However, they are more expensive, costing two to three times as much. Tank-based water heaters, on the other hand, store hot water in a tank. Their capacity ranges between 30 to 80 gallons. Moreover, they are easier to install but take one to two hours to refill once the hot water runs out.

    Difference between Tank & Tankless Water Heaters

    Tank Water Heater Tankless Water Heaters
    Fuel, Electric, Gas, Propane, & Solar Fuel, Electric, & Gas
    More Affordable More Expensive
    Less Energy Efficient High Energy Efficient
    Hold 20-100+ Gallons Small Suitcase Size
    Efficient Working Even in Cold Climate Mostly Doesn’t Work in Colder Climates
    Lasts 8-12 Years Lasts 20 Years
  2. Efficiency Rating

    Water heaters come in different efficiency levels. High-efficiency models are available for both tankless and tank-based systems. They can save a lot of energy, anywhere from 100% to 300% more than standard models. However, they do cost more upfront, around $1,000 to $3,000 extra.

  3. Size Matters

    The size of the water heater is essential to consider because it significantly affects its cost. For tank-based heaters, you must consider how many gallons of hot water your family needs. If you have one or two people in your home, a 30-gallon tank will probably be sufficient. If your household has four to five people, you will need a larger 40 to 50-gallon tank. And if your daily water usage is less than 40 gallons, a single tankless system should be enough. But if you use more, you might need two tankless systems. Moreover, a list of water heater rates based on water tank size is given in the table below;

    Size in Gallons Water Heater Cost
    30 $270–$1,000
    40 $300–$1,600
    50 $400–$2,500
    75 $900–$3,200
    80 $1,000–$3,200
  4. Fuel Source

    Before you choose a water heater, think about what type of fuel it needs and if it is available for your home. For instance, if you want a natural gas water heater, check if your home has a natural gas line or can get one. Moreover, gas water heaters are reliable and they often save money on utility bills because natural gas is generally cheaper than electricity.


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Method to Estimate Water Heater Installation Cost

Before hiring a professional, one must consider expert estimators for determining the hot water heater replacement cost. Here is a step-by-step guide to estimate water heater installation costs.


Water Heater Installation


Step #1: Evaluate the Current Water Heater

First, take an examining look at your current water heater. Check its type, whether it is tankless or tank-based, and how efficient it is. Also, find out its size and whether it is powered by gas or electricity. This will help you understand what you should do now.

Step #2: Determine the Desired Replacements

Decide what kind of water heater you want to replace the old one with. You can choose between tankless and tank-based systems. Think about how much hot water your family needs and how efficient you want it to be. This will help you figure out the best replacement for your needs.

Step #3: Researching Water Heater Prices

Now, it is time to find out how much the new water heater will cost. Look up the prices of the tankless or tank-based system you want. Compare different brands and models to see which one fits your budget while meeting your requirements. Scan the water heater rates at different brands;

Brand Cost
Rheem $400 to $2,300
AO Smith $400 to $3,500
Bradford White $400 to $3,000
Kenmore $350 to $1,000
Whirlpool $350 to $ 1,500

Step #4: Identify Installation Cost

Remember that installing a new water heater is essential particularly when your system is getting out of order. Check with professionals or stores to find out how much it will cost to install the water heater you selected. Sometimes, installation costs can vary, so make sure to get a clear idea of the total expense. You can take advantage of cost estimating services offered by Nedes Estimating to determine the water heater installation expense.

Step #5: Add Additional Expenses

In addition to the water heater and installation costs, there might be some extra expenses. For example, if you need to make changes to your home’s gas or electrical connections for the new water heater, it could add to the total replacement cost. Also, consider any additional accessories or parts needed.

Step #6: Finalize the Replacement Cost

Once you have all the cost-related information, add up the water heater cost, installation cost, and any extra expenses you identified. The total will give you an estimate of how much it will cost to replace your water heater. This way, you will be prepared with a clear idea of what to expect financially when you are ready to replace the old unit with a new and more efficient one.

You might have a question about the accurate calculation of estimates. Check out 5 Tips To Boost Accuracy of Construction Cost Estimates and do calculations confidently!


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Average Water Heater Installation Expense

Replacing a small tank-style water heater can cost as little as $500, while bigger tanks can be as expensive as $3,000 when installed. If you go for a 50-gallon tank water heater, it may cost around $1,000including installation. Tankless water heaters have similar costs, but they are generally more expensive than tank-style ones. However, the installation of tankless water heaters can be less costly. Keep in mind that gas-powered tankless water heaters may have higher installation costs compared to electric-powered ones.

Average Water Heater Installation Rates
Average Cost $1,000
Highest Cost $3,000
Lowest Cost $500

Cost to Replace Different Water Heaters

The cost of installing water heaters varies depending on their style and how they are powered. For example, some water heaters need a new gas line or changes to the space to fit a larger tank-style water heater. To install water heaters, you will need the assistance of a plumber, and in some cases, an electrician if you are using an electric-powered water heater.

  • Tank vs. Tankless

    In the world of water heaters, there are two main categories: storage tanks and tankless water heaters. Let’s dive into their distinct features and the costs associated with them!

  • Storage Tank Water Heaters

    Storage tank water heaters are the familiar tall, cylindrical tanks found in many homes. The cost of these tanks usually ranges from $500 to $800, depending on their size. However, keep in mind that the installation expenses can vary, averaging between $650 and $2,100.

  • TanklessWater Heaters

    Tankless water heaters have been gaining popularity as energy-efficient options. They come in rectangular shapes and can be installed in various locations. The price range for tankless water heaters varies based on the type you choose
    Type #1: Whole-House Tankless Water Heater
    For a whole-house tankless water heater, you can expect to pay between $500 to $1,500, depending on the selected model and fuel type. The installation cost generally falls between $1,000 and $3,500. These systems provide hot water whenever you need it and boast higher energy efficiency compared to storage tank water heaters.
    Type #2: Single-Point Tankless Water Heaters
    If your home’s plumbing extends across a large area, single-point tankless water heaters can be a smart choice. With prices ranging from $500 to $1,500, their installation cost is typically around $1,000. By placing them close to where the water is used, you can save water and energy as hot water will not have to travel far.

    Pro Tip

    Whether you go with a storage tank or a tankless water heater, understand their costs and benefits to make the right choice for a cozy and energy-efficient home!

  • Gas vs. Electric

    When we talk about the fuel source, there are two basic options one must consider; gas and electricity. Both have distinctive features, rates, and installation costs.

  • Tank-Style Water Heaters

    When it comes to tank-style water heaters, the power source can make a difference in installation costs. Let’s uncover the expenses for electric and gas-powered tank-style water heaters!
    Type #1: Electric Tank-Style Water Heaters
    If you are considering an electric tank-style water heater, be prepared to spend between $800 and $1,500for installation. The final cost will depend on the tank’s size and any additional work required.
    Type #2: Gas-Powered Tank-Style Water Heaters
    On the other hand, gas-powered storage tank water heaters offer a more budget-friendly installation range. You will have to pay between only $400 and $800 for the installation, depending on factors like tank size and any necessary adjustments.

  • Tankless Water Heaters

    Tankless water heaters are known for their energy efficiency. Let’s explore how their installation costs differ for gas and electric models.
    Type #1: Gas Tankless Water Heaters
    For a gas tankless water heater, the installation cost usually falls within the range of $900 to $1,500. This investment ensures you will enjoy the on-demand hot water while saving on energy bills.
    Type #2: Electric Tankless Water Heaters
    If you prefer an electric tankless water heater, you are in for an affordable installation journey. The typical cost ranges from $150 to $1,000, depending on the specific model and any modifications needed.

  • Direct Vent vs. Power Vent

    When it comes to tank-style water heaters, there is more to consider than just the type of fuel they use. Let’s explore the world of vents and understand the differences between direct vent and power vent systems, along with the installation costs involved.

  • Direct Vent Tank-Style Water Heaters

    A direct vent system in a tank-style water heater uses a specialized vent flue to channel the exhaust gases outside the home. This type of venting is designed to ensure safety and efficiency, as it prevents the exhaust from lingering inside the house. Direct vent water heaters are often found in homes that have specific venting requirements.

  • Power Vent Tank-Style Water Heaters

    On the other hand, a power vent system utilizes a fan or blower to push the exhaust gases out through the vent pipe. This method offers more flexibility in terms of installation since it can be vented horizontally through an exterior wall or vertically through the roof. Power vent water heaters are often preferred when the installation of a direct vent system is not feasible.

Installation Expenses

Typically, the cost to install the vent pipe for a direct vent gas water heater ranges from $500 to $1,000. The total expense will depend on factors such as the complexity of the installation, the distance the vent pipe needs to travel, and any necessary modifications to accommodate the new system.


Power Vent Tank


Water Heater Replacement Labor Cost

Before discussing the water heater replacement labor cost, it is essential to consider the total time required and related factors.

Installation Time & Factors

The total cost of installing a hot water heater depends on how long the installation process takes and other factors. If you decide to switch from one type of water heater to another, the cost may be higher than simply replacing it with the same kind. Additionally, if there is any extra electrical or plumbing work required during the installation, it can increase the overall costs.

Labor Costs to Replace Water Heater

When you hire a local plumber to install a gas or electric water heater, their charges typically range from $45 to $150 per hour. If the installation requires additional electrical work, such as installing a new outlet or wiring, a local electrician might charge between $50 and $100 per hour.

DIY Or Hiring A Pro for Water Heater Installation

Dealing with anything related to water in your home requires careful attention because water can cause significant damage if not handled properly. Especially when it comes to tank-style water heaters, they can be heavy and challenging to move, making it crucial to seek help from someone experienced. So, if you do not have experience as a plumber and do not know how to install a water heater, it is much safer to let a professional handle the job.

Another important reason to hire a professional is that installing a water heater often requires a permit. By having a pro handle the installation, you can be confident that it will meet all the necessary codes and regulations. Improperly vented gas-style water heaters can lead to problems like back-drafting, where dangerous exhaust gases linger inside your home. It can further put your health and safety at risk. To avoid any potential issues, it is best to rely on an expert who can ensure that everything is done correctly and safely.

So, when it comes to installing a water heater, leave it to the professionals to ensure a successful and worry-free installation process. And before hiring a professional, remember to get the assistance of electrical estimators to hit the accurate budget and complete your replacement project efficiently!


Replace Your Water Heaters with the Assistance of Professional Estimators



Today’s generation wants a comfortable environment to live and work in. The water heater has become a need of every person. Whether you prefer tank-based or tank-less water heaters, you find it mandatory to fulfill your needs with hot water during cold weather. Once you have installed a water heater at your place, its efficiency reduces with time. The average lifespan of gas water heaters ranges between 8-12 years while the electrical water heaters last between 10-15 years. You can follow the given method to estimate the accuarte expense required for water heater replacement. Moreover, when you need replacement, you should calculate its replacement cost with the assistance of professional estimators. They can benefit you with dependable water heater replacement estimates while efficiently reducing cost and time.

Frequently Asked Questions


Your tank-style water heater can last between 8-12 years. However, you can also elongate its lifespan by proper maintenance and repairing minor issues on time. A tankless water heater, on the other, can, can work efficiently for around 20+ years. It has a longer lifespan because there are no chances of corrosion in it.

Water heaters can stop working if they get rusty and start leaking around the drain pipe, T&P relief valve, or drain return. Also, the heating elements can wear out over time, and this might mean you need to get a new water heater.

The cheapest water heater to install is the standard tank-style unit, which typically costs between $650 to $2,500, covering both materials and labor. On the other hand, tankless water heaters can be two to three times more expensive than standard tanks.

The cost to replace a 50-gallon electric water heater is approximately $1,000, while a natural gas heater of the same size would cost around $1,200. These prices include both the new water heater unit and the installation expenses. The difference is due to the variation in equipment and labor requirements.

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