Tankless Water Heater Complete Buyer's Guide: What to know

Tankless Water Heater Complete Buyer's Guide: What to know
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Tankless Water Heater – Complete Buyer’s Guide


In case you didn’t know, choosing the right tankless water heater actually requires you to know a lot of things. Namely, there are lots of different tankless water heaters on the market and you can’t be one hundred percent sure which on to choose.

Luckily, we are here to discuss everything that you need to know about tankless water heaters and how to choose the perfect one for your home.

So, without further ado, let’s get down to business and see what we have prepared for you. Let’s begin.

What Is A Tankless Water Heater?

For those that are still wondering what exactly is a tankless water heater, the answer is pretty simple – Tankless Water Heater is a water heater that only works on demand. This means that this water heater is capable of saving a lot of energy due to its compact and specially designed features.

As we all know, a traditional water heater is storing hot water inside its chamber until you decide to use it. That’s quite costly since the water is constantly getting reheated and that requires a lot of energy which is not free.

On the other hand, a tankless water heater only uses energy when it’s needed. In other words, once you turn the tap for hot water, the tankless water heater delivers it in seconds.

Therefore, the hot water is not simply sitting inside a water heater and getting constantly reheated until you use it, no. The water is not reheated or even heater until you decide to use it – that’s the exact time when the tankless water heater will start spending energy and you’ll get hot water delivered.

Anyhow, in order to provide you with the best picture of tankless water heaters, we are simply going to answer some of the most important questions about them. In that light, let’s see.

Tankless Water Heaters – How do They Work?

If you think that tankless water heaters are complicated and complex, well, you’ll be wrong – they are working in a quite simple manner.

Everything starts when you open a tap for hot water. Now, once you do that, the cold water will run into the tankless water heater where it will be heated to a certain level. The electrical heating element inside a tankless water heater will heat the water that runs through it and you’ll get hot water on your side of the tap.

Simply speaking, a tankless water heater is only heating cold water once you open hot water tap. Now, as you can see, this is a quite cost-efficient system that will save you a lot of money comparing to the traditional water heating system.

But, the tankless water heater is limited by its flow rate. And, in case you wonder what that means, well, the flow rate is the exact amount of water that a tankless water heater can deliver at any time. So, you can’t expect a tankless water heater to deliver more hot water since it’s limited to a certain amount. 

Is it a Better Choice to go with the Traditional Water Heater?

For some reason, people who are thinking about switching to a tankless water heater system are often wondering is that a good idea. Well, there are lots of advantages to having a tankless water heater system, and therefore, choosing a traditional water heater system is absolutely not a good idea.

Anyhow, decide for yourself:

Tankless Water Heater System

The On-demand system that heats the water when needed

  • Requires a bit larger up-front investment
  • Modifications are often needed for the installation
  • Designed Compactly
  • Eco-Friendly
  • Able to be repaired
  • Size and Capacity Matters

Traditional Water Heater System

Stores the heated water in a tank for later use

  • Shorter life expectancy rate
  • Limited range capacity (from 20 to 80 gallons)
  • Requires a lot of space
  • Cost-friendly for purchase and installation
  • Possible leaking and heating problems
  • Uses a lot of energy

 Tankless Heater and Traditional Water Heater Comparison

As we can see, the differences in these two systems are big. However, someone might find the traditional water heater system perfectly find for its home. On the other side, someone might benefit highly from the tankless water heater system.

All in all, truth be told, almost everyone could benefit a lot with the tankless water heater system, but, it requires a bit larger up-front investment. In that light, we are ready to discuss the benefits and downfalls of the tankless water system.

Let’s take a closer look.

Benefits and Downfalls of Tankless Water Heater

Having a good insight into the pros and cons will definitely give you the best picture of the tankless water heaters. We only explained how they work and what they are so far, but, the real benefits and downfalls are yet to be presented.

Anyhow, let’s see every good and every bad side of having a tankless water heater.

Benefits of Tankless Water Heater

It’s quite important to know that all these pros that we are enlisting here are directly contributing to the overall performance of a tankless water heater in general.

  • Cost-efficient Solution – The tankless water heater is only heating the water when you demand it to. This means that there’s no unnecessary spending of the energy, and therefore, the costs are really low in the long run.
  • Better Life Expectancy Rate – Tankless water heaters are going to serve you for approximately up to 20 years. On the other hand, traditional water heaters are doesn’t have that long life expectancy rate.
  • Able to be Repaired – Possibly one of the most important benefits of tankless water heaters is that they have replaceable parts. This means that you can always replace some parts and the water heater will run smoothly once again.

As for the traditional water heaters, when some of their parts are malfunctioning, you can only get a completely new boiler.

  • Compact Design – With being so compact, a tankless water heater is not using plenty of space which means that you can put it basically anywhere you want. The traditional water heaters are quite big and they often need a lot of space which is quite inconvenient in most cases.
  • Endless Hot Water Supply – Definitely the best thing about tankless water heaters is that they provide an endless supply of hot water. You just need to turn the tap and the water heater will do everything for you.

When it comes to traditional water heaters, you’ll need to constantly keep them turned on in case you want to have an endless supply of hot water, and, as we all know, that’s quite expensive.

  • Water is Always Fresh – One more pro that surely is providing lots of benefits, the tankless water heater always uses fresh water directly from the main water supply line. This is quite convenient since you won’t need to worry about all the corrosion spots that are happening due to the water that sits in the tank like in a traditional water heater.
  • Convenient Solution – Last but not least, the tankless water heaters are also quite convenient for many different homes and residences. Namely, they don’t have a storage tank and therefore, you can install them pretty much anywhere.

As we can see, the benefits of a tankless water heater system are definitely making this On-Demand system quite a good idea.

However, let’s not jump to any conclusions, we first need to see all the bad parts of the tankless water heaters. Let’s start.

Downfalls of Tankless Water Heater 

Like with every great invention, tankless water heaters have their disadvantages as well. So, let’s see them.

  • Initial investment – It’s quite obvious that tankless water heaters are very expensive in the beginning. If you want to install one, you’ll have to pay a top dollar and that can be quite expensive. This is only because a tankless water heater system is such a good option in the long run, and therefore, you need to invest in this system so it can pay off.
  • The capacity of the Water – This depends mostly on the household, but, in some cases, one tankless water heater is not able to cover the whole house. Namely, sometimes you’ll need to add two large tankless units and install them inside your home so you can benefit from this whole system.
  • Power Inconvenience – It’s not a secret, but, tankless water heaters are running under a lot more electricity than the traditional water heaters. So, the power output and the power line should be checked and compatible with the tankless water heater. That’s why some households need a bit of an improvement in this field.
  • Gas Venting Costs – When it comes to gas-fueled tankless water heaters, they require a bit more expensive venting systems. Without a proper venting system, you’ll end up with lots of other problems regarding the tankless water heater.

So there you have it. Even though tankless water heaters have their own downfalls, they are still a good option. Their benefits are definitely casting all the disadvantages in a shadow.

Choosing the Right One – Tankless Water Heater Options

When it comes to choosing the perfect tankless water heater for your home there are all sorts of things that you need to take into consideration. For starters, we can discuss some of the most important ones.

So, you’ll need to know a couple of things first:

  1. Determine the number of devices and their flow rate.
  2. Calculate the required temperature rise.
  3. Size is absolutely important.

However, to make it a bit easier for you, we’ll divide this part into some categories so you can have the best insight for choosing the most suitable tankless water heater. So, let’s begin.

Take these things into consideration before you choose a tankless water heater:

1) Efficiency Matters

It might seem a bit strange, but there are lots of choices to go for when it comes to energy savings. Simply put, you should pay close attention to the specifications of the tankless water heater and you need to try to find the one that suits your needs.

All you need to know is that water heaters use a standard Energy Factor (EF) rating in order to measure their efficiency. So, there are some quite important things that you need to know about EF and tankless water heaters.

  • Measuring the overall efficiency of any water heater, the Energy Factor is a world-wide measurement unit.
  • The level of EF rating directly comes from the water heater since it’s determined by the used energy.
  • The EF rating is found on the exact amount of hot water that is made by the single unit of fuel consumed.
  • When the EF rating is high, that means that the efficiency is also high.

But, there are lots more things to take into consideration since the EF rating is not telling us everything about the costs. Namely, the electric on-demand systems are known to have a higher EF then gas units, but, gas as a fuel is less expensive than the electricity and they have lower annual costs.

And, as we can see, the EF rating is not showing us trust-worthy information about the efficiency. However, this is an important thing to take into consideration no matter what. This is only one of the many factors that you need to have on your mind in order to choose the most suitable tankless water system.

2) Look for Warranty

When it comes to warranty, you can’t always be sure which tankless water heater to choose. Namely, this can vary from one manufacturer to the other, and they all offer some kind of warranty options.

Also, in most cases, if you want to have any warranty options, most of the manufacturers require you to register your water heater first. This way, they can do the installation themselves so everything will be eligible for this type of coverage.

Anyhow, there’s no point in comparing the warranty policies since you can find all sorts of options there. But, you can always rely on an old fashioned rule ‘’When a manufacturer stands behind its product, they offer good warranty deals’’. This means that the product is reliably and dependably good when it comes to life expectancy rate and performance.

On the other hand, those manufacturers that have poor warranty options and deals are most likely selling a mediocre-quality product.

However, we can generalize this topic by saying that many manufacturers actually have something in common. They usually provide coverage within these ranges:

  • Heat Exchanger – Usually go from 10 to 15 years.
  • Necessary Parts – Usually go from 2 to 5 years.
  • Labor – Usually go for 1 year.

That being said, it’s clear to you that choosing a tankless water heater that has a good warranty option might be a better choice. After all, your product will be covered with warranty options in case something happens.

3)  Size and Design – Select the most Suitable One

Now, we’ve only mentioned Efficiency Rating and Warranty as one of the things that you need to take into consideration before choosing a tankless water heater. But, they are usually not that important compared to Size and Design.

So, let’s start at the top. The size and the design of a tankless water heater is definitely the top priority you need to take into consideration before choosing one for your home. Namely, most of the manufacturers actually determine the size of the water heater by the temperature rise component.

This means that when the temperature rise is high, the water heater should have a higher flow rate as well. These two things are actually the most important thing to know about the tankless water heater. And, once you do the calculation for your own household, you’ll know exactly which tankless water heater to get.

So, here’s a little guidance:

  • Your tankless water heater should deliver 2 to 5 gallons (flow rate) per minute.
  • Gas fueled tankless water heater systems are able to deliver a higher flow rate.

Now, as we mentioned before, knowing the exact temperature rise and the exact flow rate for your household can definitely give the right guidance when choosing the tankless water heater. Look at it this way, if you had an 80 Gallon tank traditional water heater then you will need a tankless water heater that has 8 GPM (gallons per minute) flow rate.

Therefore, knowing the exact numbers of the GPM and the Temperature Rise, you’ll be able to choose the right size of the tankless water heater.

But, how can you determine these parameters down to the exact number that you need? Well, here’s a little help.

Flow Rate Calculation

First, you will need to determine the exact number of devices that will use hot water from the water heater. Then, you’ll need to add the exact GPM of each device and do the math.

Here’s a general guideline for GPM calculation:

  • Shower Faucet - 1992 standard 2.2 GPM / Older shower heads 4.0 - 8.0 GPM
  • Bathroom Faucet –1992 standard 2.2 GPM / Older faucets 3.0 - 5.0 GPM
  • Kitchen Faucet –1992 standard 2.2 GPM / Older faucets 3.0 - 7.0 GPM
  • Other – In this category, you will need to list other appliances such as washing machines, dishwashers, and stuff like that.

Once you get all the information about the GPM, you can continue to the calculation of the Temperature Rise.

Temperature Rise Calculation

Two things are definitely the most important here:

  • Ground Water Temperature – That’s the temperature of the water that’s entering your home.
  • Output Temperature – The wanted temperature of the hot water.

We know that taking these numbers isn’t easy, so, here are more guidelines:

  • Rule Number 1 – If the groundwater temperature is 50F, and you want to get approximately 120F of the hot water inside your home. Then, you’ll need the tankless water heater that has 70F degrees of Temperature Rise.

As you can see, taking 50F from 120F is resulting in 70F and that’s the exact number of Temperature Rise you need.

  • Rule Number 2 – The level of Temperature Rise will change throughout the year since the groundwater temperature is constantly changing.

So, there you go. Now you know the two most important things in order to choose the perfect size and capacity of the tankless water heater for your home.

4) Choose a Proper Fuel Type

As we advance further, the criteria for choosing the right tankless water heater gets more serious. Namely, there are two different fuel types:

  • Gas Fuel Type
  • Electric Fuel Type

Both of these types have their own advantages and disadvantages and we are going to discuss them one at the time. So, let’s begin.

Gas-Fueled Type of Tankless Water Heaters

This is definitely the right type of tankless water heaters for those that have natural gas or propane available for their households. However, not everyone can afford this, so it might be a better choice to go with the electric fuel type.

Anyhow, gas fueled tankless water heaters have quite fast response time and high heat output. These specifications are making them quite a popular choice. But, on the other hand, they are definitely more expensive when it comes to the up-front investment.

That being said, let’s see a bit more about the gas fueled type of tankless water heaters.

Supply Line

First of all, gas fueled tankless water heaters must have a proper fuel supply line. Without it, the whole thing wouldn’t be able to operate properly. So, the fuel supply line must be sized accordingly in order to provide just enough fuel for burners to heat the water.

This means that these burners inside the tankless water heater that runs on gas must be supplied with enough gas in order to heat the water. And, usually, these burners are using approximately 200,000 Btu/h which is actually quite high since traditional water heaters only use approximately 75.000 Btu/h.

Also, in some cases, you might need to increase the size of the gas fuel supply line just so the burners could heat the water properly.

Ignition Type

This one is quite important. There are 3 different types of gas fueled tankless water heaters when it comes to ignition. Now, there’s a general rule that explains the complexity of ignition types ‘’If the ignition system is more complex, the more expensive tankless water heater is’’.

This only happens because some ignition systems are not that good when it comes to energy savings.

But, however, here they are:

  • Standard Pilot Light – This type is known for its constantly burning pilot light, less expensive up-front costs, but a higher cost to operate.
  • Direct Ignition – When it comes to direct ignition, the following applies: They don’t run constantly only on demand, Good and efficient energy savings, additional parts are needed.
  • Hydro-Power Ignition – The hydro-power ignition is based on the following rules: With the use of a small turbine activated by water the burner is ignited, No battery or electricity needed, Manly made by Bosch.

That’s about it when it comes to ignition types. As we can see, these types all have their strong sides as well as their disadvantages. Choosing the right one for your home is definitely the best idea.

Venting System

In case you want to get a gas fueled tankless water heater, you’ll need to invest in a good venting system. Since venting is one of the top priorities when it comes to gas fueled types of water heaters, the importance of having a good venting system is crucial.

However, the venting system of a tankless water heater is a bit more flexible since it can go through the roof or even horizontally through the wall. This means that your household is most likely suitable for installing a high-quality venting system.

Furthermore, tankless water heaters require a different type of venting than traditional water heaters. Namely, a ‘’Category III’’ venting system with stainless steel pipes is required for a tankless water heater that is fueled with gas.  This venting system is durable and corrosion-free, but on the other hand, it’s quite expensive.

Even though this venting system is costing a bit more, it’s absolutely necessary because of the condensation. Simply speaking, the condensation from tankless water heaters that run on gas is highly acidic and that can easily melt down other types of venting system. That’s why you’ll need to get the ‘’Category III’’ venting system with stainless steel pipes.

The venting system is required for an indoor gas fueled tankless water heater system. However, there’s an option to go with the outdoor unit as well. These tankless water heaters don’t need the venting system since they are already outside.

On the other side, indoor models require a good venting system. But, in the past few years, a new option surfaced – the ‘’Condensing Tankless Water Heaters’’. Namely, this is a type of system that eliminates the need for venting.

So, if you want to get an indoor tankless water heater system, you’ll be faced with two options when it comes to gas fueled ones – The ‘’Condensing Tankless Water Heaters’’ and the ‘’Non-Condensing Tankless Water Heaters’’. Let’s take a look at both.

Condensing Tankless Water Heaters:

  • Heat is extracted from the exhaust.
  • Able to achieve higher efficiency ratings.
  • Less expensive venting materials could be used for this system.
  • More expensive in the beginning but they have higher efficiency over time.

Non-Condensing Tankless Water Heaters:

Direct Venting

  • Uses outside air for combustion.
  • One vent for air intake is required.
  • One vent for exhaust is required.
  • Convenient for small spaces.

Power Venting

  • Uses inside air for combustion.
  • One vent for exhaust is required.
  • Only able to work in the area where the air is adequate for combustion or else it won’t work.

As we can conclude, the venting is quite important for condensing tankless water heaters but, there’s always an option to go with the non-condensing one and spend a bit more money.

Electric Fueled Type of Tankless Water Heaters

As you could already suspect, the electric fueled tankless water heaters are definitely less expensive than gas fueled ones when it comes to installation. However, they really require a lot of energy to operate properly. Also, if there’s a need to upgrade your household electric system, the installation will cost more.

Now, as for the design, electric fueled units are made to be much simpler and easier for installation. There are a couple of benefits due to their design:

  • Easier to diagnose
  • Less expensive repairs
  • Easy to maintain
  • Not taking much space
  • Higher efficiency rating
  • Longer life expectancy rate

And, as we can see, the whole process of installation and operation is much more simplistic with the electric fueled than the gas fueled tankless water heater units. In that light, here is a comparison table.

Electric Fueled

Gas Fueled

Smaller units – Convenient for smaller spaces.

Normal size units

Less expensive – Requires approximately $500 to $700 to be founded.

Expensive – Requires $1000+ to be founded.

Great Energy Efficiency

Mediocre Energy Efficiency

Most homes need an upgrade when it comes to installation.

Not that complicated for installation.

Less expensive installation.

Expensive installation.

Delivers up to 8 GPM of hot water.

Delivers up to 5 GMP of hot water.

Long life expectancy rate.

Mediocre life expectancy rate.

Venting is not necessary.

Venting is absolutely necessary except for the outdoor units.

Convenient for most of the households.

Not convenient for everyone.


This table is providing a full picture of both gas and electric fueled tankless water heaters. And, you can now have the best insight and choose the one that suits you the best.

Tankless Water Heater – Maintenance

It’s a known thing that all water heaters, no matter the type, require proper maintenance. And, it’s whether you like it or not, your job to do it.

In that light, annual maintenance is quite important, especially for the traditional water heaters. However, with the tankless water heaters, the maintenance process is a bit easier since they don’t have sitting water inside a tank.

The gas fueled tankless water heaters are usually prone to mineral build-up which is coming from water. When this build-up occurs, the heat exchanger will spend more energy and it might overheat from time to time. That’s why you need to do proper maintenance.

But, let’s see that from a better perspective, let’s compare electric and gas fueled tankless water heaters when it comes to maintenance.

Electric Fueled vs. Gas-Fueled – Maintenance

The owner’s manual clearly shows the exact and specific maintenance requirements for each tankless water heater. However, in general, it’s recommended to clean the unit every 6 to 24 months.

This mostly depends on the ‘’hardness’’ of the water in the area where your household is located. If the water is full of minerals, build-ups inside the unit will be more frequent and in larger portions. In that light, let’s see about the types.

Electric Fueled Unit

This unit requires barely any maintenance. The only thing that you need to do is to clean it every once in a while and make sure that everything runs smoothly.

Gas Fueled Unit

The gas-fueled units are definitely requiring way more maintenance. Namely, since the gas is a flammable substance, the help of a professional is needed for every annual maintenance check. Besides that, the cleaning of these units is quite harder.


So there you have it! Choosing a tankless water heater is definitely not an easy task since you have to take into consideration a lot of things. But, however, we’ve made it a bit clearer and definitely easier. All you have to do is to determine which type of water heater is going to fulfill your needs and meet your household standards.

Anyhow, we surely hope that this guide helped you to make a decision and to get the best possible unit for your house.