If you’re in the market for a new heater, you’re probably wondering how much to install water heater.
The answer to this question depends on a variety of factors, including the type of water heater you choose, the size of your home, and the complexity of the installation.
In this article, we’ll break down the average cost of water heater installation and help you determine what you can expect to pay.
According to recent estimates, the average cost of water heater installation ranges from $900 to $3,000, with the national average coming in at around $1,400.
Of course, this is just an estimate, and your actual costs may vary depending on a number of factors.
For example, if you opt for a tankless water heater, you can expect to pay more upfront but save money in the long run on energy bills.
Similarly, if you live in an older home with outdated plumbing, your installation costs may be higher due to the need for additional upgrades.
When it comes to determining the cost of your water heater installation, it’s important to take into account all of the factors that will impact your final bill.
By doing your research and getting quotes from multiple contractors, you can ensure that you’re getting the best deal possible and that your new water heater will be installed correctly and efficiently.
How Much To Install Water Heater
Installing a water heater can be a costly investment, but it’s an important one for the comfort and convenience of your home.

Here’s what you can expect to pay for water heater installation.
Water Heater Price
The price of the water heater itself will depend on the type and size you choose.
Tank water heaters are generally less expensive than tankless water heaters, with prices ranging from $820 to $1,583.
Tankless water heaters, on the other hand, can cost anywhere from $1,200 to $3,910.
Installation Labor Costs
Installation labor costs will vary depending on the complexity of the installation and the location of your home.
On average, installation labor costs range from $150 to $800.
However, if you need to have additional work done, such as upgrading your electrical or plumbing systems, the cost can be significantly higher.
Additional Expenses
In addition to the cost of the water heater and installation labor, there may be additional expenses to consider.
For example, you may need to pay for permits, installation materials, and removal of your old water heater.
These costs can add up quickly, so it’s important to factor them into your budget.
Overall, the cost to install a water heater can range from $1,950 to $3,500, depending on the type and size of the water heater and the complexity of the installation.
However, investing in a high-quality water heater can save you money in the long run by reducing your energy bills and minimizing the need for repairs and replacements.
Determining The Need For A New Water Heater
If you’re experiencing issues with your current water heater, it may be time for a replacement.
Here are some factors to consider when determining if you need a new water heater.
Assessing Your Current Water Heater
The first step in determining if you need a new water heater is to assess your current one.
Check for the following signs that your water heater may be failing:
- Age: If your water heater is over 10 years old, it may be time for a replacement.
- Rust: Check for any rust on the tank or water supply pipes.
- Leaks: If you notice any leaks around the tank, it could be a sign of a failing water heater.
- Strange noises: If you hear any unusual noises coming from your water heater, it may be time for a replacement.

Considering Energy Efficiency
When considering a new water heater, it’s important to think about energy efficiency.
Upgrading to a more energy-efficient water heater can save you money on your utility bills.
Here are some options to consider:
- Tankless water heaters: These types of water heaters are more energy-efficient because they only heat water when you need it.
- High-efficiency tank water heaters: These types of water heaters are designed to be more energy efficient than traditional tank water heaters.
- Solar water heaters: These types of water heaters use energy from the sun to heat water, making them a very energy-efficient option.
In conclusion, assessing your current water heater and considering energy efficiency are important factors in determining if you need a new water heater.
By taking these factors into consideration, you can make an informed decision about whether or not to replace your water heater.
Types Of Water Heaters
When it comes to choosing a water heater, there are three main types to consider: tankless, storage tank, and heat pump water heaters.
Each type has its own advantages and disadvantages, so it’s important to understand the differences between them before making a decision.
Tankless Water Heater
A tankless water heater, also known as an on-demand water heater, heats water only when it is needed.
This means that there is no storage tank, and the water is heated as it flows through the unit.
Tankless water heaters are typically more energy-efficient than storage tank water heaters, as they only heat water as it is needed.
They are also more compact and can be installed in smaller spaces.
However, tankless water heaters can be more expensive to install than storage tank water heaters.
Additionally, they may not be able to provide enough hot water for larger households, as they have a limited flow rate.
Storage Tank Water Heater
A storage tank water heater is the most common type of water heater.
It consists of a large tank that stores hot water until it is needed.
When hot water is used, cold water enters the tank and is heated to the set temperature.
Storage tank water heaters are typically less expensive to install than tankless water heaters.
They can also provide hot water to multiple fixtures at once, making them a good choice for larger households.
However, storage tank water heaters are less energy-efficient than tankless water heaters, as they continuously heat water even when it is not needed.
They are also larger and take up more space than tankless water heaters.

Heat Pump Water Heater
A heat pump water heater uses electricity to move heat from the air or ground to heat water.
They are highly energy-efficient, as they use less electricity than traditional electric water heaters.
Heat pump water heaters are more expensive to install than storage tank water heaters, but they can save you money in the long run by reducing your energy bills.
They also have a longer lifespan than storage tank water heaters.
However, heat pump water heaters may not be suitable for colder climates, as they rely on heat from the air or ground to heat water.
They also require a larger space than storage tank water heaters, as they need to be installed in an area with adequate airflow.
How To Save On Installation Costs
If you’re looking to install a new water heater, you may be wondering how to save on installation costs.
Here are a few tips to help you save money:
DIY Installation
One way to save on installation costs is to do it yourself.
However, this option is only recommended if you have experience with plumbing and electrical work.
If you’re not comfortable with these tasks, it’s best to hire a professional.
DIY installation can save you money on labor costs, but you’ll still need to purchase the water heater and any necessary materials.
Rebates and Tax Credits
Another way to save on installation costs is to take advantage of rebates and tax credits.
Many utility companies offer rebates for energy-efficient water heaters.
Additionally, the federal government offers tax credits for certain types of water heaters.
Be sure to check with your utility company and tax professional to see if you qualify for any rebates or tax credits.
In conclusion, there are a few ways to save on installation costs when installing a new water heater.
If you’re comfortable with plumbing and electrical work, you can save money by doing it yourself.
Additionally, be sure to check with your utility company and tax professional to see if you qualify for any rebates or tax credits.

Key Takeaways
Installing a new water heater can be a costly but necessary investment that can save you money in the long run.
Here are some key takeaways to keep in mind when considering the cost of water heater installation:
- The national average for tank water heater installation is between $906 and $1,583 for the unit and labor, and tankless water heaters cost around $1,833 to $3,910 to purchase and install.
- The type of water heater you choose and the fuel source it requires can impact the cost of installation.
- Gas water heaters tend to be more expensive to install than electric ones, and tankless water heaters are generally more expensive than traditional tank models.
- The cost of installation materials, permits, and removal of the old unit can add to the overall cost of installation.
- Some home improvement stores, such as The Home Depot, offer same-day installation at no extra charge.
- It’s important to choose a licensed and insured plumber to install your water heater to ensure that the job is done safely and correctly.
- Regular maintenance and proper installation can help extend the lifespan of your water heater and save you money on repairs and replacements in the future.
By keeping these key takeaways in mind, you can make an informed decision about the cost of water heater installation and choose the best option for your home and budget.