There’s nothing worse than expecting a steaming hot shower in the morning and instead finding only ice-cold water. Fortunately, water heater installation costs less than many other major household appliances and can be done in just two to three hours.
We use real-world data from RS Means — a building materials database used by contractors across the United States — to give you the most accurate cost information possible. That way, you won’t get any surprises when you call for an estimate from your local water heater installer.
Ready to install your new water heater? Use the tool below to connect with your area’s best plumbers.
How Much Does It Cost to Install a Water Heater?
On average, water heater installation costs between $960 and $3,910, but most homeowners pay around $2,200 to install a new water heater, including the water heater and the labor costs.
The up-front cost to install a water heater depends on several factors: the type of water heater, fuel source, and efficiency. We’ll explore each of these factors more in the sections to come.
| Low | Average | High |
| $960 | $2,200 | $3,910 |
- On average, installing a water heater costs between $960 and $3,910.
- Most homeowners only need a 30- to 50-gallon water heater that costs between $960 and $1,880 to install.
- Gas water heaters cost about $2,607 on average, but electric water heaters cost less at $1,177 on average.
How Do Water Heater Installation Costs Differ By Size?
The factor that will likely impact the total cost of your new hot water heater the most is the size. The size of your water heater directly affects the amount of hot water you’ll have at a given time — the larger the size of the unit, the more water you’ll have.
The number of people who live in your home will help you determine which size water heater is best for you. A 30- to 40-gallon water heater should do the job if you live with just one or two people. But if you have more than six people in your household, you should look into a 70- or 80-gallon water heater.
The number of people in your home isn’t the only factor you should consider as you decide which size water heater you want. If you’re the type of person who enjoys long, hot showers or steaming-hot baths, you may want to consider a larger water heater.
| Tank Size | Number of People in Home | Average Cost |
| 30 gallons | 1 – 2 people | $960 – $2,275 |
| 40 gallons | 2 – 3 people | $1,000 – $2,500 |
| 50 gallons | 3 – 4 people | $1,265 – $1,880 |
| 70 gallons | 5 – 6 people | $1,275 – $3,500 |
| 80 gallons | 6+ people | $2,650 – $3,910 |
How Does Tank vs. Tankless Affect Water Heater Installation Pricing Pricing?
There are two types of water heaters: tank and tankless. Tank water heaters typically cost between $1,000 and $2,500 to install, whereas tankless water heater installation costs between $960 and $3,910.
| Type of Water Heater | Average Price Range |
| Tank Water Heater | $1,000 – $2,500 |
| Tankless Water Heater | $960 – $3,910 |
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Tank Water Heater
Tank units are the most traditional water heater style and keep a stash of water hot and ready. Most tank water heaters cost between $1,000 and $1,800 to install, but high-efficiency units can cost up to $2,500 or more.
It takes as little as one to three hours to install a tank-style water heater, and these units have a six to 15-year life span. A tank water heater is a good choice if you have three to four people in your home or high water demands.
Tankless Water Heater
Unlike tank water heaters that store a set amount of water, tankless water heaters warm water up as needed — which means you’ll have an endless supply of hot water. Tankless units save you money by only heating the water you need; they’re also more energy efficient and have a 20-year lifespan. On average, tankless water heater systems cost between $960 and $3,910.
Learn how tankless water heaters save energy with this video:
Which Factors Impact Water Heater Installation Cost Estimates?
The size and type of water heater play an important role in your total cost, but several other factors can influence how much your water heater will cost. As you shop for water heaters and gather quotes, consider the following factors to save the most money possible and choose the right water heater for your home.
Gas Water Heater vs. Electric Water Heater
Fuel type — natural gas or electric — does play a role in how much your water heater installation will cost. Electric water heaters tend to be the least expensive to install but cost more to run because the cost of electricity is more than the cost of gas.
New gas water heaters cost $2,607 (on average) including installation costs. Compared to electric water heaters, gas models can heat water more quickly. However, they come at a higher cost and are only 60% to 70% energy efficient.
If you want a more efficient water heater, an electric water heater is the way to go — electric heaters are about 95% energy efficient. At an average cost of $1,177, they’re also a lot less expensive to install. But as mentioned above, running an electric water heater costs a lot more. As of February 2023, the U.S. average cost of electricity is 15.96 cents per kilowatt hour.
| Water Heater Type (30 gallons) | Average Materials Cost | Average Installation Cost | Materials and Installation Cost |
| Electric | $920 | $257 | $1,177 |
| Gas | $2,325 | $282 | $2,607 |
Energy Efficiency
A high-efficiency water heater can be as much as 300% more efficient than older, more traditional models — but tend to be more expensive at $1,000 to more than $5,000 to install. However, if you plan on staying in your home long-term, installing a high-efficiency system is worth it simply because you’ll save money on your monthly energy bill.
There are three types of energy-efficient water heaters: hybrid heat pumps, indirect water heaters, and solar water heaters. Indirect water heaters work similarly to tank water heaters and use a coil to heat the water but use your boiler or furnace to heat water instead of its own energy source.
Hybrid heat pump water heaters and solar water heaters both rely on external sources to heat water. Heat pumps use the air to heat water, and solar water heaters use energy from the sun to heat your water. Both indirect and hybrid heat pumps cost around $1,000 to $3,600 to install — but solar water heaters tend to be the most expensive and can easily exceed $10,000 if installed in a larger home.
| Type | Average Cost |
| Hybrid heat pump | $1,250 – $3,600 |
| Indirect | $1,000 – $3,500 |
| Solar | $1,700 – $5,000+ |
Water Heater Brand
The cost of your water heater may also depend on the brand. Although most water heater units start at $400, some brands — such as Kenmore and Whirlpool — offer cheaper models at $350 to $1,000 and $400 to $1,700, respectively. High-end water heaters — like those offered by AO Smith and Bradford White — can cost up to $3,000 for the unit alone.
Related: Rheem Proterra vs Performance Platinum – Which Water Heater is Better?
| Brand | Average Unit Cost |
| AO Smith | $400 – $3,000 |
| Bradford White | $400 – $2,800 |
| Kenmore | $350 – $1,000 |
| Rheem | $400 – $2,500 |
| Whirlpool | $400 – $1,700 |
Additional Cost Factors
The bulk of your total installation cost will come from the water heater and installation costs, but other smaller costs can quickly add thousands of dollars to your bill. For example, if you relocate your water heater, you could pay up to $3,500 on top of a $50 to $150 permit.
Other costs may be worth the investment, such as an extended warranty or home warranty for your water heater. These plans can offer peace of mind should your water heater break down, as these policies often cover any water heater replacement costs.
| Cost Factor | Average Cost |
| Direct vent or power vent | $500 – $1,500 |
| Electrician labor costs | $50 – $100 per hour |
| Expansion storage tank | $100 – $350 |
| Optional water heater warranty | $100 – $300 |
| Permits | $50 – $150 |
| Plumber labor costs | $45 – $200 per hour |
| Relocate water heater | $150 – $3,500 |
What Are the Benefits of Installing a Tankless Water Heater?
The obvious main benefit of installing a water heater is having hot water for your showers, laundry, and dishwasher — but if you are considering a tankless water heater over a tank, you could benefit even more from the change.
Abundant Hot Water Supply
Unlike traditional tank heaters that keep a constant supply of hot water at the ready, tankless water heaters create warm water on demand. This continuous hot water supply means you won’t run out and won’t have to wait for water to heat up. As long as you have the right size tankless water heater, your hot water supply won’t be a problem ever again.
Longer Lifespan
A tankless water heater can be a good investment, particularly because they last an average of five years more than a tank water heater. Tankless water heaters have a lifespan of 20 years, while tank water heaters last up to 15 years on average. Tankless water heaters are more expensive than tank heaters, but the added lifespan can make the extra few hundred dollars worth it.
Lower Utility Bills
Because tankless water heaters only heat the water you need, they can save you hundreds of dollars in energy costs each year. Tankless water heaters can be up to 50% more energy efficient than tank models.
Professional vs. DIY Water Heater Installation
Installing a water heater is a difficult task that requires knowledge of water lines, gas lines, electrical work, and more. You’ll also need a permit to install a new water heater, and you’ll need to make sure it’s installed correctly to avoid explosions or hazardous conditions. For these reasons, we strongly recommend hiring a professional to install your water heater.
Doing Water Heater Installation Yourself
You should work with professionals to install your new water heater — if it’s installed incorrectly, you could be at risk for explosions, gas leaks, and other hazardous conditions. But if you do decide to attempt water heater installation by yourself, make sure you obtain the correct permits from your local utilities building and follow these steps:
- Get plumbing and electrical permits.
- Remove the old water heater (if applicable).
- Disconnect water lines and turn off electricity.
- Prepare the location of the new water heater and leave at least 6 inches of clearance around any ventilation system.
- Wrap your heat trap fitting threads.
- Replace the shut-off valve (if applicable).
- Install your water relief lines and pressure relief lines.
- Turn on the main water valve and open all lines.
- Turn on your water heater.
- Set the water heater temperature to your desired temperature.
Hiring a Professional for Water Heater Installation
To ensure that your water heater is installed safely and correctly, it’s important to work with a professional plumber to get the job done. When you work with a professional plumber, they can also help you figure out which size and type of water heater is best for your home.
Follow these easy steps to get connected to the best plumbers in your area:
- Find local experts near you: Use the tool below to get in touch with the best plumbing professionals in your area.
- Get a quote from a few options: It’s always a good idea to get at least two quotes from different companies so that you can compare cost and timeline.
- Consult them about their recommendations: If you don’t know which brand, size, or type of water heater is best for your home, then ask your plumber what they recommend.
- Compare water heater quotes: Look over each of your water heater installation quotes and decide which is best for your needs.
- Install your water heater: Choose the date and time to get your water heater installed.
Ready to hire a professional plumber to install your new water heater? Use the tool below to get started.
So, Is Water Heater Installation Worth It?
If you don’t have a water heater in your home, you don’t have access to hot water. So, of course, a water heater is worth it. Most water heaters cost between $960 and $3,910 to install — but if you opt for a large solar water heater, you could pay $10,000 or more. However, most homeowners pay around $2,200.
If you’re looking for energy savings, then a tankless water heater may be your best option. These models supply an endless amount of hot water, are more efficient, and will cost less money each month. But if you’re on a budget, then it’s best to install a tank water heater with enough gallons to support your family and home needs.
FAQs About Water Heater Installation Cost
Which is better: a 40- or 50-gallon water heater?
If you have a larger family of four or more, a 50-gallon tank is better. A 40-gallon water heater is suitable for a family of two to three people, but if you find yourself quickly running out of water, you can and should upgrade.
What are the risks associated with water heaters?
Carbon monoxide leaks are a major risk associated with water heaters, but other risks include rusty or dirty water, nasty odors, corrosion, water temperature problems, and fires or explosions caused by gas leaks.
Why are water heaters so expensive to install?
Most water heaters cost between $960 and $3,910 to install. This includes the water heater and installation costs — but if you relocate your water heater or install an expansion tank, you can add up to $2,000 to your total cost.
However, installing a water heater in colder climates may cost more than in warmer climates because cold regions have a higher risk of pipe freezing.
Who installs a water heater?
While an HVAC pro will install your furnace or air conditioner, a licensed plumber typically installs a water heater. They can install tank, tankless, gas, and electric water heaters.
How much does it cost to replace a 40-gallon water heater?
A 40-gallon water heater costs between $1,000 and $2,500 to install. This cost includes both the water heater and the cost of labor.
