Buyers Guide: What Tankless Water Heater Do I Need?


tankless water heater

Choosing a new tankless water heater is not a decision that should be made lightly. After all, this is the device that will be responsible for providing you with hot water for the next 15 to 20 years.

What tankless water heater will you need for your house? The biggest factors that determine what type of tankless water heater you will need is the number of plumbing fixtures in the home and the demand placed on the system due to family size.

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Because all tankless water heaters are not created equal, careful research is needed to make the right purchase decision. Differences in cost, flow rate, energy demand, and other factors make different tankless water heaters better for different situations, and you need to be aware of these factors when figuring out which tankless water heater you need. 

To help you choose the right tankless water heater for your particular situation, we’ve created this comprehensive buying guide. We’re going to walk through a bunch of different factors you need to account for when looking at tankless water heaters, and we’ll finish off with our recommended heaters for common living situations. 

Why Should I Buy a Tankless Water Heater?

A tankless water heater is an improvement on the traditional storage tank heater in almost every meaningful way. 

  • It doesn’t run out of hot water.
  • It has a significantly longer lifespan. 
  • It uses less energy.
  • It saves you money in the long term. 
  • It takes up less space.
  • It’s easier to maintain. 
  • Leakage causes less damage. 

Because of all these advantages, most homes nowadays come preinstalled with a tankless water heater. And many homes with tank-equipped heaters are upgrading to tankless when their current heater breaks down and needs to be replaced. 

Which Features Should I Care About When Buying a Tankless Water Heater?

Amount of hot water production

The first thing you’ll need to consider is how much hot water you’ll need your tankless heater to produce. We typically refer to this process as “sizing” the heater, but you aren’t going to be using dimensional measurements to figure this out. Instead, you’ll need to look at two distinct metrics: flow rate and temperature rise. 

Flow rate

Water heaters measure the amount of hot water they can produce with a metric known as “flow rate,” which is measured in gallons per minute (GPM). Most tankless water heaters can produce between 2 and 8 gallons per minute. To determine your flow rate requirement, you’ll need to add up the flow rates of all the devices in your house that might use hot water simultaneously. 

You can only know your exact flow rate requirement by checking your hot water device documentation. This list of typical flow rates for common appliances should help you make an estimate though:

  • Sink: 1.5 GPM
  • Dishwasher: 1.5 GPM
  • Washing machine: 2.0 GPM
  • Shower: 2.5 GPM
  • Bath tub: 4.0 GPM

Temperature rise

Once you’ve calculated the maximum flow rate your tankless unit will need to provide hot water to all of your home’s devices, you need to figure out the required “temperature rise.” The temperature rise is the amount in degrees your water heater will need to increase the temperature of incoming water to provide sufficient hot water to your home’s devices. 

Here’s an example: say the temperature of incoming water is 50°F. Your dishwasher needs that water heated to 110° before it can clean dishes. To supply the dishwasher with 110° water, your water heater would need to raise the temperature of the incoming water by 60°. 

So if 110° was the highest water temperature required by any of your hot water devices, you would need a tankless water heater that can produce a 60° rise in temperature.

Putting flow rate and temperature rise together 

Water heaters are rated in terms of both flow rate and temperature rise. To properly size your water heater, you would need to combine your required flow rate with your required temperature rise. 

Here’s another example. Say you have four devices that might simultaneously require hot water: 

  • Sink: 1.5 GPM / 110°
  • Dishwasher: 1.5 GPM / 110°
  • Washing machine: 2.0 GPM / 120°

Let’s also assume your incoming water temperature is 50°. 

To run all of these devices simultaneously, you would need a tankless water heater with a flow rate of 5.0 GPM and a temperature rise of 70°. The 5.0 GPM flow rate comes from adding all of the device flow rates together, and the 70° temperature rise comes from subtracting the incoming water temperature (50°) from the highest device water temperature (120°). 

Now, just because your devices’ combined flow rate adds up to 5.0 GPM doesn’t mean you absolutely need a water heater with a flow rate of 5.0 GPM. If you don’t plan on using all of your hot water devices simultaneously, you can get away with buying a less expensive heater with a smaller flow rate. 

You can’t skimp on the temperature rise though. If your hot water heater can’t provide the necessary temperature rise for one of your appliances, that appliance won’t be able to do its job correctly.  

Electric vs. Gas

Once you’ve determined the required flow rate and temperature rise, you’ll need to decide between an electric-powered unit and a gas-powered unit. Each has its pros and cons. 

Pros of buying an electric tankless water heater

Electric units cost less to buy and install

One of the primary benefits of buying an electric tankless water heater is that they are less expensive to purchase than their gas-powered counterparts. Whole house electric models typically between $500 and $700, while whole house gas-powered models cost $1,000 to $1,200+.  

The cost of installing an electric tankless heater is also significantly less than installing a gas-powered tankless heater. Once you’ve confirmed your home’s wiring is compatible with the model you’ve chosen, installing the electric heater is a relatively quick process. 

It should be noted that electric tankless water heaters may require some electrical upgrades. Some electric water heaters require up to 4 – 40amp breakers to operate, which could raise installation costs significantly.

On the flip side, installing a gas-powered heater can incur some pretty high costs as well. For starters, you’ll need to install a ventilation system to safely get rid of the vapors your heater might emit. There are also a lot of safety and inspection costs you need to consider, such as confirming the size of your gas line and ensuring an adequate supply of fresh air. 

Electric units are easier to maintain

One reason electric units cost less than gas-powered units is that they are simpler devices. There are fewer components inside, which means there are fewer moving parts that can break down and require expensive repair. And when a repair is needed, you’ll typically pay less than if you were repaying a gas-powered unit.

Electric units are more efficient

The best gas-powered tankless heaters tap out at about 85% energy efficiency. This is pretty poor compared to most electric units, which average a whopping 98% energy efficiency. So even if natural gas is cheaper than electricity in your area, you might still end up saving money on energy costs by going with an electric unit. 

This also means electric heaters are more environmentally friendly. Producing electricity is already less harmful to the environment than burning natural gas is, and the increased energy efficiency of electric models only adds to the difference in impact.

Electric units are safer

Any device that uses gas to fuel a flame carries a significant safety risk. While electrical fires are always a possibility, the risk of faulty wiring sparking a blaze is less than the risk of ever-present gas vapors sparking up.

I do recommend consulting with an electrician before connecting your heater to your home’s electrical system though. The risk of fire increases drastically if a professional doesn’t oversee the installation.

The price of gas will rise more quickly than the price of electricity

The price of gas is expected to rise dramatically in the next few decades. While the price of electricity is also expected to rise, the growth of renewable energy sources like solar and wind are expected to keep prices at a more reasonable level. 

With a service lifespan of approximately 20 years, a tankless water heater definitely qualifies as a long-term investment. As such, you need to consider the potential cost of your energy source a couple of decades down the road. Going with an electric unit will likely be the smarter choice in this regard. 

Pros of buying a gas-powered tankless water heater

Gas-powered units support higher flow rates 

The main reason some buyers choose to go with a gas-powered heater over an electric unit is that gas-powered units can support higher flow rates. The best electric units max out at 8GPM, while gas-powered units can go significantly higher than that. If you need a tankless heater for a large household or some kind of industrial purpose, you may have no choice but to go with a gas-powered option. 

Natural gas is significantly cheaper than electricity in some parts of the world

Depending on where you live, the discrepancy in price between natural gas and electricity might make it enticing to go with a gas-powered model. However, even if natural gas is significantly cheaper than electricity, the increase in efficiency that comes with electric models and the forecasted increase in natural gas prices might still make going electric the better option. 

Dimensional size

Now that you’ve “sized” your water heater and decided between gas and electric, you need to figure out the actual dimensional size of water heater you can accommodate. 

This is probably the easiest part of the whole process. Unlike heaters with water storage tanks, tankless heaters are compact and relatively tiny. The average electric unit measures 10 inches high by 7 inches wide, while the average gas-powered unit measures 30 inches high by 20 inches wide. 

Indoors or outdoors?

Unlike heaters with storage tanks, which must always be located inside, tankless water heaters can be installed inside or outside of your home or office. 

The main benefit of installing your tankless heater outside is that you don’t need to install a ventilation system for gas-powered units. Electric units don’t require ventilation, so there is no real benefit to installing them outside. 

Mounting your tankless water heater outside is typically reserved for warmer climates where the temperature doesn’t drop below freezing too often. This is because a tankless water heater can freeze and is almost impossible to repair, and you’ll probably have to replace the entire unit if the water is allowed to freeze inside. So if you’re buying a gas-powered heater and live in a warmer climate, installing it outside is something you might want to consider. Otherwise, installing it indoors is probably a safer option.

Warranty Terms

The final thing you need to look at before making a purchase decision is the warranty. Repairs can cost an arm and a leg, so checking that your water heater’s warranty is comprehensive and long-lasting can save you thousands of dollars down the road. 

Here are a few key things to check when analyzing a water heater warranty: 

  • The length of the warranty. Is it a lifetime warranty? Or does it expire after a certain length of time? Because tankless water heaters can last for upwards of 30 years, you should do your best to find a manufacturer offering a lifetime warranty. 
  • The comprehensiveness of the warranty. Does the warranty cover all possible repairs? Or are there certain problems the manufacturer refuses to cover?
  • Any actions that void the warranty. Many manufacturers refuse to honor warranty agreements on devices that were not installed by a licensed plumber. If you’re planning on a DIY installation, check that any repairs will still be covered after you’re finished. 

Best Tankless Water Heater for Small Apartments and Homes 

Rheem RTEX 13 Electric Tankless Water Heater

If you need a tankless heater for a small apartment, your best option is the Rheem RTEX 13 electric tankless water heater (available on Amazon). 

So, why the Rheem RTEX 13 for small apartments?

For starters, it’s extremely affordable. The price on Amazon was under $300 at the time of this writing, and there’s a good chance that price will only decrease as time goes on. It’s also an electric unit, which is what you’d want in a small indoor location with a lower hot water requirement. 

The average 1.5 GPM flow rate is pretty good for the compact 9” x 4” x 13” size and affordable price. While the Rheem can’t handle a full household’s hot water demand, a small apartment with a single bathroom and kitchen should be covered. 

The 99.8% energy efficiency is another big selling point. Almost zero electricity is wasted by this device, so you’ll see some savings on your electric bill if you buy this heater over less efficient alternatives. It also makes this heater one of the most environmentally friendly tankless heaters on the market. 

The final feature of note is the modern digital display and easy-to-use temperature dial. If you want to change the temperature of your hot water, you can do so with the turn of a knob. 

As for the warranty. Rheem offers a 5 year primary warranty for most of their units. This means you’ll get 5 years of covered service for the heat chamber ‒ you’ll only get 1 year for parts.

To finish off this recommendation, here are a few things of note that other buyers have asked questions about:

  • To run this device, you’ll need a 60 amp breaker. Any less and the device won’t work properly.
  • You don’t need an overflow line leading outside your home to use this unit.
  • If hot water enters the inlet line, the heater will shut off automatically.
  • The heater needs to be installed upright on a wall. You can’t lie it on its back and still expect it to work properly.
  • The hot water temperature maxes out at 140°F.
  • The minimum flow rate for activation is 0.4 GPM. Any less than that and the heater won’t turn on.
  • This unit is resistant to harsh weather. Owners with outdoor installations report zero issues with rain, wind, or freezing temperatures.
  • You can install this unit in an RV if you life. You’ll just need to make sure you have space in the electrical panel for a 60 amp device. 

Best Tankless Water Heater for Medium-sized Homes

If you need a tankless water heater for a medium-sized home, your best bet is the Stiebel Eltron Tempra 36 Plus (available on Amazon). 

This is an electric tankless heater variable flow rate depending on your incoming water temperature. Stiebel advertises a maximum flow rate of 7.5 GPM with an incoming water temperature of 72°F, but your incoming water probably won’t be that hot. An average flow rate of 4.0 GPM is more likely for most locations. 

One innovative feature on the Tempra 36 Plus is the advanced flow control. If you know you’ll be using less hot water than normal, you can limit the flow rate on your unit to use less energy and save money. Limiting the flow rate will also diminish the wear on your unit, which will result in a longer service lifespan and increase the amount of time until you need to replace your water heater. 

As this is an electric heater, you’ll get all of the efficiency-related savings that come with using an electric unit. There’s also no need to install a ventilation system as you don’t have to worry about toxic gas vapors wafting into your home. 

The warranty on this device is par for the course: you’ll get 7 years of leakage coverage and 3 years of parts coverage. With proper installation and maintenance, your device should last the minimum 20 year service lifespan. 

To finish off this recommendation, here are a few things of note that other buyers have asked questions about:

  • This unit does not recirculate hot water to provide an instantaneous flow. It takes a bit of time to heat colder water up. 
  • It comes with an installation guide, but unless you know what you’re doing, you’d probably be better suited leaving the installation to a professional. 
  • You’ll need two 50 amp breakers and a minimum of 150 amp panel to properly install this device.
  • The Stiebel technical support line is quite helpful if you have any installation or maintenance questions. 
  • If you want to install this unit outside, you’ll need to install it in a waterproof casing. 
  • This unit is extremely quiet. If you’re concerned about the noise your water heater will make, the Tempra 36 Plus is an excellent choice.

For larger homes, a Hybrid Heat Pump Water Heater may be a better option than a tankless electric water heater. You can read more about how hybrid heat pump water heaters work, their cost, lifespan, and saving in our article How Hybrid Heat Pump Water Heaters Work – Benefits, Cost, & Savings.

Best Tankless Water Heater for Larger Homes

Rinnai RUC98iN Ultra Series Natural Gas Tankless Water Heater

If you need a gas-powered tankless water heater for a large and water-hungry household, I recommend going with the Rinnai RUC98iN Ultra Series Natural Gas Tankless Water Heater (available on Amazon).

The standout feature on the Rinnai RUC98iN is the hefty 9.8 GPM flow rate. You can run a small army of hot water devices before the heat begins to falter. 

While this heater does run on natural gas and therefore doesn’t receive the benefits of an electric heater, it’s a necessary tradeoff if you want the heavy-duty flow rate this device kicks out. Larger households are typically better equipped for the ventilation requirements of a gas-powered unit, so the additional work needed to set this device up 

The Rinnai RUC98iN also has a decent warranty: 12-year coverage for the heat exchanger, 5-year coverage for parts, and 1-year coverage for the labor required for residential installations. It’s not the lifetime warranty I recommended earlier, but that’s honestly something of a unicorn in the water heater sector. Rinnai is also a renowned company known for consistently producing high quality products, so you can rest easy ‒ if this heater is installed and maintained properly, it will almost certainly last the minimum 20 year lifespan.

To finish off this recommendation, here are a few things of note that other buyers have asked questions about:

  • This heater does not work with propane. You must use natural gas to fuel this unit. 
  • This device does come with isolation valves and a pressure relief valve. They are easy to lose in the box, so make sure to look closely for them when opening the packaging. 
  • You need at least 60 PSI from your water source to use this heater. If you have less than that, you should consider a different heater with lower PSI requirements. 
  • This heater does not include a flush kit. You need to buy one separately if you plan on taking care of regular flush maintenance yourself. 
  • This heater does not include a condensation trap kit. Your building codes might require you have a condensation trap kit, so check with your local municipality to see if you need to buy one separately. 
  • This device is particularly quiet. Owners report very little noise even when the unit is running.
  • This model does not come with a buffer tank, so take that into account when making a purchase decision.
  • It’s not wifi-capable. If you need a device with wifi capabilities, you’ll need to look elsewhere. 
  • This unit can’t be installed outdoors, as it’s strictly an interior model. Rinnai has other similar models for exterior installations.

Best Tankless Water Heater for RVs and Campers

While the tankless water heater options we’ve discussed thus far have been geared toward homes, RVs and campers need hot water too. And unfortunately for people who enjoy taking RV trips, they can’t take their home water heater with them. 

The solution is to buy a tankless water heater specifically designed for RVs and camping. While there are quite a few options on the market, I recommend the Camplux 5L 1.32 GP Portable Outdoor Tankless Propane Water Heater (available on Amazon). While it doesn’t stack up to home-based heaters, it will allow you to get enough hot water for shower or sink usage at an affordable price. 

This is a gas-powered heater, so installing it inside your RV will require some additional ventilation. You can easily avoid this by using the heater outside of your camper though. 

It also has a few useful safety features: anti-freeze protection, oxygen depletion shutoff protection, and a flame failure device. If you need hot water while you’re out camping, this device is an easy and affordable way to get it. 

To finish off this recommendation, here are a few things of note that other buyers have asked questions about:

  • The ignition on this portable heater can be turned on with 2 D batteries. 
  • You can use the heater with a 12 volt water pump if the need arises.
  • You can’t use water heated from this unit as drinking water. The heat isn’t high enough to safely eliminate any bacteria that might be lurking in the water. 
  • The incoming water pressure needs to be between 5 psi and 10 psi for the device to work properly.
  • This Camplux model is a flow-activated device. Once you turn the shower on, the water heater will automatically ignite.
  • You shouldn’t use this unit above 2000 feet of elevation, as it won’t work properly.
  • This unit’s dimensions are 5.5″ x 11.4″ x 14.6″. It’s extremely compact, and can be folded into an even smaller size for storage and transport. 

HomeInspectionInsider.com is owned and operated by Hubert Miles is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.com. HomeInspectionInsider.com also participates in affiliate programs with other affiliate sites. Hubert Miles is compensated for referring traffic and business to these companies.

Hubert Miles

I've been conducting home inspections for 17 years. I'm a licensed Home Inspector, Certified Master Inspector (CMI), and FHA 203k Consultant. I started HomeInspectionInsider.com to help people better understand the home inspection process and answer questions about homeownership and home maintenance.

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