Tankless water heaters have been around for a few years now, and they’ve recently become increasingly popular. With more and more homes upgrading to feature more energy-efficient systems, like a tankless water heater instead of a traditional water heater, we thought it would be a good idea to investigate what the pros and cons are of both systems, to see which one works best in any given situation. But first, let’s start with the basics.
What is a Tankless Water Heater?
A tankless water heater has no tank, instead, water is only heated when it’s in use, which means it uses far less energy.
What is a Traditional Water Heater?
A traditional hot water heater is a tank that typically holds 40–60 gallons of water that is continuously heated until used.
Pros and Cons: The breakdown
|Tankless Water Heater||Traditional Water Heater|
|Equipment Cost||CON: Most tankless water heaters vary in price range, but on the low-end they cost around $1,000.||PRO: Traditional tanks cost between $300- $600, even on the high-end, they are better priced than a tankless option.|
|Space||PRO: As there’s no tank, this means the space usually taken up by the water heater can be used for other property improvements, like extra storage or a laundry area.||CON: A tank that holds between 40-60 gallons of water takes up space, there’s no way around it. You can hide it in a separate closet, but it’s still there, eating up valuable real estate.|
|Installation||CON: The installation process for a tankless water heater is more complicated and time-consuming, and far more expensive than a traditional one. In fact, few plumbers know how to do it correctly, and those who do, tend to charge a premium for the service. In addition, they require additional electrical work, which means prices can vary even more dramatically.||PRO: Traditional water heaters are the norm, which means plumbers are familiar with the process, and can install them easily, quickly, and without a premium added for performing a more complicated service. In our experience, it costs around $1450 to install a new water heater and have the old one hauled away.|
|Energy||PRO: Since water is only heated when needed, it’s far more energy efficient. Some estimates show that a tankless water heater uses 22% less energy than a traditional water heater.||CON: The tank is constantly using energy to keep the 40-60 gallons of water hot, which means it is constantly using energy, driving up your utility costs.|
|Time to hot water||CON: Because water is being heated at the time of use, this means it can take up to 2 minutes for hot water to arrive. In colder climates it can take even longer.||PRO: Water is being drawn from a tank of pre-heated water, which means access to hot water arrives pretty quickly, definitely faster than a tankless system.|
|Longevity||PRO: Tankless systems can last up to twenty years, which means the initial investment in installation may be worth the cost if you plan on keeping a property long term. However, it’s important to note that they must be descaled annually, which can add up fast.||CON: Water heater tanks need to be replaced every 12 years (give or take), which can be a nuisance, especially for a location a property manager plans to keep long term. In addition, some cities require expansion tanks, which can add to the cost.|
Should you switch to a tankless system?
From the pros and cons list above, you can see this is a tough one, as they have an equal number represented in both categories. The important thing to do as a property manager or homeowner, is to do your research and find out what’s best for you. If you plan on holding onto the property long-term, then it may be a worthwhile investment to make, especially with regard to sustainability efforts. If you’re unsure about how long that property will be yours, it may not be worth it to invest such a high amount of capital into a system that won’t necessarily increase your property value.
Remember, there are other ways to build equity in your property that don’t require you to make big changes like a total system reinstall. If you’re a property manager, chances are you have a lot on your plate that you may not have time to oversee. Worry not, that’s why we’re here. We’re a full service brokerage with the know-how to guide you through the ever-changing world of property management. Why not set up a free consultation with us? Let’s see how we can work together to bring you success and a little rest too.