If you are living in a cold region, you need a water heater at home to get a regular supply of warm water. However, water heaters have a short lifespan and may require replacement every 10 to 15 years. For this reason, you need to learn the cost of installing or replacing your water heater. To help you with this process, we have come up with this guide. In this article, we are going to discuss water heater replacement costs in detail.

Average Water Heater Replacement Cost

Average Water Heater Replacement Cost

It is not expensive to replace your outdated water heater in comparison to other home appliances. One of the main factors that could impact the final cost is location.

It is more expensive in certain places and less expensive in others. The type of heater you select may also have an impact on the cost. As there is no fixed price, here’s an estimate of the average cost to replace the water heater.


Water Heater Installation and Replacement Cost

Water Heater Installation and Replacement Cost

The typical cost to replace a water heater is not constant and can change based on a number of factors. To get the total coat, you must account for the cost of labor, the unit’s size, and the components and materials. Here is a breakdown of the total water heater replacement cost. 

1. Cost of Labor

If you want to install or replace your water heater, you should call a licensed plumber. Plumbers often bill between $45 and $200 per hour, and electricians typically bill between $50 and $100 per hour.

An hourly wage calculation is used to determine the labor costs. It can account for almost half of the overall cost and be a major cost element depending on how complicated the installation is.

Here are the labor charges.

Replacing a tank-style water heater$150 to $450
Replacing a tankless water heater$600 to $1,850
Converting a tank-style water heater to a tankless systemUp to $2,500

2. Parts and materials

The price of parts and materials plays a significant role in the hot water heater replacement cost. You’ll need different materials for your installation specialist. These consist of venting pipes, pressure valves, thread compound, solder, connections, gas and water piping, and more. 

They might occasionally require extra materials as well. If you’re moving from a tank heater to a tankless one, the installer might need to install support inside the walls to hold the tank and brackets in place safely. The additional criteria may result in higher material prices for you.

3. Unit size

Another factor that may have an impact on the water heater replacement cost is the size. There are several sizes available for hot water heaters, with units of measurement expressed in gallons. 

The cost increases with the size of the tank. Based on tank size, these are the general prices.

Unit Size In GallonsAverage Price 
30$600 to $1,800
40$600 to $2,200
50$800 to $2,500
75$1,200 to $3,500
80$1,500 to $3,800

The primary consideration when selecting the appropriate water heater size for your home is the number of occupants. Generally, a 40 to 50-gallon water heater will be enough for a household of two or three. 

Bigger families will need larger tanks. But keep in mind that an overly large water heater will cost more to run, so avoid doing so.

Water Heater Installation Cost by Type

There are various types of heaters to select from. The type of appliance you select will also affect the water heater replacement cost. These are the many kinds of water heaters and their typical costs.

Water Heater TypeAverage Price 
Tank$1,000 to $2,500
Tankless$1,000 to $3,500
Gas$700 to $2,700
Electric$600 to $3,500
Direct vent$600 to $1,200
Power vent$600 to $1,200

1. Tank

water heater Tank

One of the earliest kinds of heaters is the tank water heater. They facilitate the consistent storage and usage of heated water. When compared to tankless units, storage tank water heater installation is usually simpler. They become less expensive as a result.

The price of these heaters varies depending on the dimensions of the tank. However, it might range from $600 to $800. Hot water tank replacement will cost you anywhere from $1,000 to $2,500.

This kind of water heater often requires one to three hours for installation. They consume roughly 58 to 60 percent of energy and have a lifespan of six to fifteen years. This kind of heater is a fantastic option if your household consists of three to four people or if your water usage is excessive.

  • Its initial cost is affordable
  • Offers constant supply of hot water
  • The installation procedure is easy
  • Due to continuous heating, it consumes more energy
  • Life expectancy is less

2. Tankless

Tankless water heater

Water is heated on demand by tankless water heaters. To heat water pipes and deliver hot water when needed, they either use electricity or a gas burner.

These energy-efficient machines save money by heating the water only when needed. They also last for about 20 years at a time. 

These heaters can cost anywhere between $600 and $1,500. The average cost to install a tankless water heater is between $1,000 and $3,500.

  • It utilizes less energy
  • Because there is no tank, it helps conserve space
  • Lasts longer than tank models in terms of lifespan
  • Installation is expensive
  • It requires additional upkeep

3. Gas

Gas water heater

Propane or natural gas are the sources of heat for gas water heaters. The average cost to replace a natural gas water heater is between $700 and $2,700. In general, gas units heat water more quickly than electric ones. 

They are typically less energy-efficient and initially cost an additional $100 to $200. This kind of water heater works well in places where electricity costs are high.

A gas water heater can supply hot water without the need for electricity. However, natural gas has a higher danger of burning or leaking. The main drawback of gas water heaters is the carbon dioxide they release into the atmosphere.

  • Offers rapid water heating
  • Operates when the power is off
  • Less expensive to operate than typical electric units
  • Could result in carbon emissions
  • As venting demands increase, installation prices rise
  • Reduced longevity

4. Electric

Electric water heater

As the name goes, this type of water heater works on electricity. Electric water heater installation typically costs between $600 and $3,500. Smaller versions of these appliances start at about $200 for a single item, making them initially more affordable. 

Compact areas and flats are the ideal settings for these water heaters. Since they do not need different venting choices, they are a safer option than gas-powered ones because there is no chance of a gas leak. 

Nevertheless, depending on the cost of power in your area, the overall cost of using an electric water heater will change. The disadvantage of an electric heater is that it also affects the provision of hot water in the event of a power outage.

  • Less dangerous than devices that run on gas or propane
  • Lower upfront expense
  • Simple to operate
  • More effective at heating water than gas-powered models
  • Takes longer to heat water
  • Increasing running expenses
  • Not functional during blackouts

5. Direct vent

Direct vent water heater

Water heaters with direct vents exhaust their fumes outdoors and draw in combustion air from the outside. Setting up a vent pipe typically costs between $600 and $1,200 when replacing an electric direct vent tank-style water heater with a direct vent gas unit.

  • It contributes to lowering indoor air pollution
  • Installation is not that difficult.
  • Not appropriate for all kinds of homes
  • Installation is expensive

6. Power Vent

Power vent water heater

Power vent water heaters assist in releasing combustion gasses from the device by using a fan or blower. When natural draft venting or a conventional chimney isn’t an option, a power vent is a good choice. 

Depending on the venting configuration and supplemental electrical requirements, the cost of installing a power vent water heater may change. The cost of installing a vent pipe might range from $600 to $1,200.

  • Fit for areas without conventional venting alternatives
  • Provides more flexibility for positioning inside a house
  • More expensive installation 
  • Potentially more energy-intensive
Water Heater Installation or Replacement

When installing or upgrading a water heater, there are other expenditures you may incur in addition to the essential ones, such as labor and the water heater itself. The following other factors affect the total water heater replacement cost.

1. Inspection and Permits

Permits and inspections may be required prior to installing a new water heater installation. These guidelines ensure that the configuration complies with environmental regulations and is safe. 

Permit costs for installing a new water heater might vary from $75 to $ 1,000 based on the extent of the required work and local regulations. In case your water heater requires a natural gas connection, there could be an additional cost of between $50 and $300.

2. Gas and Water Line Installation

To make sure your replacement water heater works well and is safe, you need to connect it to your home’s gas and electrical lines. Adding on to or changing things to make room for the new water heater could increase the total water heater replacement cost. 

Putting in a gas line usually costs between $260 and $820. Still, moving from an electric water heater to a gas one might cost more than $1,500. 

You should set aside between $400 and $2,000 if you need to place a new water line along with your water heater. It is very important to employ a professional to make sure that the gas and water lines are put correctly and in line with building codes.

3. Spot in the Home

The cost of putting the water heater in a place that is hard to get to, like a basement or an attic corner, might go up. To get an idea of any extra costs, think about how easy it will be to get to the location and let the installation person know about any problems that might come up.

No matter how far you want to move your water heater, the price could range from $150 to $3,400. You might decide to move the water heater to make room for more home improvements or to save space.

Signs You Need a New Water Heater

Water Heater

The typical water heater has a lifespan of ten to fifteen years. But you will eventually require a replacement. Fortunately, there are indicators prior to a serious malfunction.

1. Discolored Water

When using hot water, rusty or foggy water could indicate that the anode rod in your conventional tank water heater has failed. Discolored water may indicate tank corrosion since this rod works to stop rust and corrosion. Anode rod replacement is possible in certain situations, but in others, it indicates a need to replace the water heater as a whole.

2. Loud Noises

Sediment build-up within the tank of your water heater may be the cause of unusually loud noises. It produces rumbling, slamming, or popping sounds due to the air pockets it forms. Recurrent noises could be a sign of serious deterioration, and a replacement is necessary.

3. Leaking Tank

A little pool or even a few drops under your water heater is a warning sign. It’s obvious that there could be damage or cracks in the tank, so it’s a good idea to get a check-up from a local water heater repair company.

4. Running Out of Hot Water

Your water heater may be malfunctioning if you’re frequently running out of hot water more quickly than before, and it’s taking longer for it to warm back up. It may be time for a new device. However, occasionally, a part replacement can resolve the issue.

5. No Hot Water

Even after lowering the heat, if you continue to experience chilly showers, it’s time for a professional examination. It’s likely that a replacement is required.

6. Metallic Taste

If your hot water has a metallic taste, it could indicate that metal is seeping into your plumbing system from the water heater. Although routine maintenance can help, you may need to replace the device if the problem continues.

7. Augmented Energy Costs

An inefficient water heater may be the cause of your rising energy costs. If the thermostat isn’t working properly, it’s advisable to get a professional repair or replacement.

Ways to Save Funds on Water Heater Installation?

Here are a few strategies to reduce the water heater replacement cost:

1. Repair Instead of Replacing

Consider having your water heater repaired rather than replaced if it isn’t nearing the end of its useful life. The cost of repairs can vary from $100 to $1,300, and basic fixes like replacing a valve may be sufficient.

2. Purchase Your Water Heater Directly

You might be able to save money by purchasing your water heater directly. But that will only help if you can get it home securely. Purchasing it via an expert could be simpler if you lack the resources to relocate it yourself.

3. Stick with the Same Type of Water Heater

Try swapping out your existing water heater for a similar type to reduce the expense of replacing it. As long as your connections are sound, this might save you money on other costs like installing new plumbing or wiring. However, you can think about switching to a more efficient water heater in order to save money over the long run.

4. Plan Ahead for Spring or Summer Replacement 

In the spring or summer, think about updating your water heater. These seasons can help you avoid paying as much for emergency services because there is less of a need for replacements.

5. Schedule Replacement for Off-Peak Times 

For a weekend or after-hours labor, some companies charge more. Schedule your replacement for a weekday during regular business hours to save some money. Even though water heater replacements frequently seem urgent, saving money by not scheduling same-day service could be worthwhile.

DIY Water Heater Installation and Replacement vs. Hiring a Professional

The process of installing a water heater is difficult. It requires an understanding of electrical work, gas and water lines, and safety precautions. Let’s see average cost to replace water heater.

It’s necessary to obtain a permit and guarantee appropriate installation in order to install a new water heater correctly and avoid risks like explosions. For this reason, we highly suggest working with a professional on this project.

Most homeowners shouldn’t attempt this difficult project on their own. Professional water heater replacement costs between $900 to $4,000, which includes both the heater and labor. 

Expert installation minimizes the possibility of mistakes or safety concerns while ensuring correct configuration. For the completed work, they also offer warranty protection.


Is it worth it to replace water heater?

It is helpful to replace water heaters as it can help you get hot water easily and also save energy costs. 

How many years should you replace your water heater?

You should replace your water heater every 10 to 15 years or sometimes even early if there is much damage. 

What is the cheapest water heater to install?

Choose an electric or gas water heater if you want to save money.


This is all you need to know about water heater replacement costs. After reading this guide, we will get information about the different factors on which the price depends. It will help you to know how much to spend and give ideas to save money. Remember that the cost details may differ on the basis of location.

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