Planning Your 2024 Water Heater Upgrade? Here’s What You Need to Know About Installation Costs and Your Options
Whether you’re dealing with a failing water heater or planning a strategic upgrade, understanding the costs and options available in 2024 can help you make the best decision for your home and budget. With water heaters lasting an average of 13 years according to EnergyStar.gov, and replacement recommended if your unit is more than 10 years old, many homeowners find themselves researching replacement options sooner than expected.
Current Water Heater Installation Costs in 2024
The cost landscape for water heater installation has evolved significantly in recent years. Average installation costs for a new water heater vary between $900 to $3,000, with the national average price to install a water heater approximately $1,400. However, these costs can fluctuate based on several key factors.
The cost of water heater installation by a licensed plumber is typically $1,610 (not including the cost of the heater), according to Yelp data. However, that cost can range from $790–$2,070, depending on several factors: whether the plumber buys the water heater, the appliance’s size and type, difficulty of installation, and your location—all of which can increase total project cost to $5,000 or more.
Tank vs. Tankless: Understanding Your Options
The most fundamental decision you’ll face is choosing between traditional tank and tankless water heaters, each offering distinct advantages and cost considerations.
Traditional Tank Water Heaters
Traditional water heaters typically cost $1,846, including purchase and installation, with a nationwide range of $1,450–2,400, according to Yelp data. This common type stores hot water in a large cylindrical tank (which holds 20–80 gallons). A traditional tank water heater costs $600 to $3,100 on average with installation. Prices for a 40- to 50-gallon water heater are $400 to $2,100 for the unit alone, and costs increase for models with larger tanks.
Tank water heaters remain popular because they’re generally less expensive to install and most plumbers are familiar with the installation process. However, while tank heaters are cheaper to install, they cost more to run than other types of water heaters. The large tank of water maintains a constant temperature, even when no hot water is being used, resulting in standby heat loss and wasted energy.
Tankless Water Heaters
Typical installation costs range from $1,846 for a storage tank heater to $3,366 for a tankless water heater, according to Yelp data. A tankless water heater costs $1,400 to $5,600 installed or $600 to $2,600 for the unit alone. The price depends on the heater size in gallons per minute (GPM), the brand, and whether you choose electric, propane, or natural gas as your fuel source.
Despite the higher upfront costs, tankless units offer significant long-term benefits. For homes that use 41 gallons or less of hot water daily, demand water heaters can be 24%–34% more energy efficient than conventional storage tank water heaters. They can be 8%–14% more energy efficient for homes that use a lot of hot water. Additionally, tankless varieties last longer than conventional water heater models which translates to a 20+-year useful life, as compared to storage tank types which last only 10 to 15 years. Tankless water heaters typically last 20 to 30 years, double the forecasted useful life of a storage tank water heater.
Factors That Impact Installation Costs
Several variables can significantly affect your total installation expense:
- Labor Costs: Professional plumbers typically charge $148 per hour to install a water heater, but hourly rates range from $85–230 across the US, according to Yelp data
- Permits and Inspections: Permits for a hot water heater replacement usually cost between $25 and $300, depending on the extent of the work and your local laws. At the very least, you’ll need a permit to install a gas appliance or alter plumbing and electricity
- Location and Accessibility: You’ll spend more on water heater installation costs if you’re replacing a water heater in a difficult-to-reach area. For example, it will cost more if your contractor has to carry the unit up or down multiple staircases or maneuver it into tight areas
- Fuel Type Changes: A plumber will need to install gas lines if you don’t have access to natural gas. This can cost anywhere from $1,500 to more than $3,000
Specialty Water Heater Options
Beyond traditional tank and tankless options, several specialty systems offer unique benefits:
- Solar Water Heaters: A solar water heater costs $3,000 to $9,000 with installation or $1,000 to $6,000 for the unit alone. Solar water heaters have lower carbon emissions and are eligible for tax credits and rebates that bring the total cost down to $1,500 to $6,600 on average
- Heat Pump Water Heaters: Heat pump water heaters are energy-efficient. Prices range from $4,000 to $8,000. They use electricity to move heat, saving energy
- Indirect Water Heaters: An indirect water heater costs $2,000 to $4,500 total with installation or $1,500 to $3,000 for the unit alone. These systems are paired with an external heat source, such as a boiler, furnace, or solar heating system
Working with Professional Installers
Choosing the right installation professional is crucial for ensuring proper setup and long-term performance. When it comes to expensive appliances like water heaters, it’s important to do your research when choosing who to hire for your installation. A poor installation job can result in repeat work, costly repairs and higher monthly energy bills. While more experienced and reputable companies will charge more for installations, you can rest assured that the installation was done correctly the first time.
For homeowners in Missouri, companies like MasterTech Plumbing, Heating and Cooling provide professional water heater services throughout the Mid-Missouri area. MasterTech Plumbing, Heating and Cooling is a local, family-owned company that has been serving Columbia and the Mid-Missouri area since 1991. We are committed to providing our customers with exceptional service, high-quality solutions, and results they can trust. Whether you need water heaters auxvasse or anywhere else in their service area, experienced professionals can help you navigate the selection and installation process.
Making Your Decision
When budgeting for your water heater replacement or upgrade in 2024, consider both immediate costs and long-term savings. While tankless systems require a higher initial investment, their energy efficiency and extended lifespan can provide substantial savings over time. Traditional tank systems offer lower upfront costs but may result in higher operating expenses.
The key is working with qualified professionals who can assess your specific needs, local conditions, and usage patterns to recommend the most cost-effective solution for your situation. With proper planning and professional installation, your new water heater can provide reliable service and energy savings for years to come.
Remember that as we move deeper into 2024, costs to replace a water heater are staying relatively flat compared to 2023. For much of the water heater replacement industry, water heater prices have seemed to peak in 2023 and are staying flat into 2024. The cost to replace a water heater will not be going down, so if you need one now, get one installed now.
