How Much Does It Cost to Install or Replace a Water Heater?

Gary Evans
by Gary Evans

Early morning showers are not everyone’s favorite, but they are necessary. Thankfully, water heaters make those early morning showers way more tolerable and comfortable. You don’t have to dread the thought of being splashed with ice-cold water so early in the morning.

Water heaters have proven to be incredibly valuable appliances and they are even regarded as necessities in some parts of the country. If your water heater succumbs to old age or some other form of damage, you must replace it immediately. So, how much will you have to pay if you need your old water heater replaced?

Removing your old water will heater will cost $300. To replace it with a conventional tank water heater, you will have to spend $800. You can also replace your old water heater with a tankless model for the price of $1,400. Paying for additional expenses such as permits and installation costs will also be necessary for this project.

Taking ice-cold morning showers is not an experience many people enjoy. Avoid that by making sure that you always have a functioning water heater. Discover how much replacing your old water heater will cost by reading the rest of this article.

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Cost to Remove Water Heater

Estimate TypeCost
Low-End Estimate$100
Mid-Range Estimate$300
High-End Estimate$500

Unless you have plenty of room to spare, you’ll probably have to remove your old water heater before installing a replacement. Removing an old water heater does not come cheap. On average, professionals charge $300 for water heater removal.

The placement of your old unit will have a significant impact on the cost of removal. If the workers have an easy time accessing the old water heater, they may also charge you less. The cost of removal may drop to just $100.

Then again, you shouldn’t be surprised if professionals charge more since your water heater is installed in such a tough spot. Workers may charge you $500 for removal because they’re having a hard time even reaching your water heater.

Carefully consider where you install your water heater. When the time comes for repairs or removal, the placement of your water heater will affect your expenses.

Cost of New Water Heater by Type

Water Heater TypeCost
Conventional Tank$800

It’s now time for us to pick a water heater. Among the most important considerations when choosing a water heater are its type and its energy source. For this section, we’ll focus first on the different types of water heaters that are currently available.

The selection includes conventional tank, tankless, hybrid, and indirect models. Which type is the best fit for your household? Come up with an answer to that question by checking out the additional details below.

Conventional Tank Water Heaters

Your first option is the conventional water heater that comes with a tank. It’s the cheapest option available and you can get it for $800.

Conventional water heaters aren’t very efficient and you also have to refill them constantly. You also have to reserve plenty of room for them.

Still, it’s hard to overlook that affordable price tag. If you’d rather not splurge on your new water heater, this option will appeal to you.

Tankless Water Heaters

Next up, we have the tankless water heaters. The average price of a tankless water heater is $1,400.

The gap in pricing between the conventional tank and tankless water heaters is large. Even so, you can argue that tankless models are well worth the added cost.

Tankless water heaters are lauded for being space-savers. You don’t have to carve out that much room for them.

You may also appreciate the efficient nature of tankless water heaters. They save you money in the long run because they only work when you need hot water.

Hybrid Water Heaters

Hybrid water heaters are also available. If you want one working inside your home, get ready to pay $1,900.

Similar to conventional models, you have to reserve plenty of room if you want to use a hybrid water heater. However, they do boast greater efficiency and that’s always a plus.

Indirect Water Heaters

Last up, we have the indirect water heaters. These are the most expensive models as they cost $2,400 on average.

As you can see, the initial cost associated with getting an indirect water heater is very high. Indirect water heaters also require a lot of room.

So, why should you get one for your home? The answer is related to operating expenses.

Indirect water heaters use the heat coming from your boiler or furnace to provide the hot water you need. That means you don’t have to pay much to get indirect water heaters working. Indirect water heaters can probably save you the most money long-term so taking that initial financial hit can be worth it.

Cost of New Water Heater by Energy Source

Water Heater Energy SourceCost

Another factor you must consider if you’re on the market for a new water heater is its energy source. There are three main options available, with those being electric, gas, and solar-powered water heaters.

Once again, there are sizable price gaps between the three options. Beyond that, you also have to consider how expensive they are to operate. You also cannot discount the importance of having an eco-friendly water heater.

Choosing between those three options is tough. We hope the information included below can make that decision just a bit easier.

Electric Water Heaters

Electric water heaters are highly affordable options available. You can get one for $1,100.

Efficiency can be a problem for electric water heaters and it doesn’t help that they are difficult to install. Still, they do work cleaner than gas-powered models. It’s also nice to know that you’ll have access to hot water as long as the power is on.

Gas-Powered Water Heaters

Gas-powered water heaters are slightly more expensive than their electric counterparts. You’ll likely have to spend $1,700 if you want a new gas-powered water heater inside your home.

The upside to using a gas-powered water heater is having flexibility. You can check which type of gas is most affordable in your area and pick a water heater that uses it. That should allow you to cut down on your post-purchase expenses.

You also don’t have to worry about blackouts cutting off your supply of hot water if you have a gas-powered unit. Homeowners who rely on electric water heaters cannot say the same thing.

Then again, gas-powered heaters are not considered eco-friendly. That factor alone may convince some homeowners to use other options.

Solar-Powered Water Heaters

Are you interested in adding a solar-powered water heater to your home? That’s a great idea, but it will cost you a lot of money. On average, solar-powered water heaters cost $6,000.

Notably, the price is the biggest drawback to getting a solar-powered water heater. If you can afford that, then you’ll gain possession of a great appliance.

Solar-powered water heaters are second to none in terms of being eco-friendly. They are also cheaper to use long-term because you’re not paying for electricity or buying gas.

There’s no denying the high cost of solar-powered water heaters. That said, their benefits are worth that high price tag.

Labor Cost to Install a Water Heater

Estimate TypeCost
Low-End Estimate$150
Mid-Range Estimate$450
High-End Estimate$850

After choosing the water heater you want to use inside your home, you can now turn your attention to installation. Labor cost is another significant expense you must account for. The average cost of installing a new water heater is $450.

Accessibility matters greatly when it comes to determining labor costs. Plumbers will charge more if they have a hard time fitting the water heater in the designated area.

The type of water heater you’ve chosen will also affect labor costs. Some water heaters are easier to install than others. You can expect the labor costs to reflect that.

Cost Factors for Water Heater Replacement

You’ve already seen from this article that replacing your water heater can be expensive. Between the cost of removal, installation, and buying the water heater itself, you could be shelling out thousands of dollars.

However, you may still not have a complete picture of how much water heater replacement will cost. After all, there are still some additional cost factors to consider and we’ve highlighted them here.


Permits will likely be required if you want to replace your old water heater. You can confirm the need for a permit with the plumber or contractor you’re hiring.

Securing the permit is not a negligible expense. You will likely have to pay $800 for the required permits alone.

New Water Lines

Are you getting an entirely different type of water heater from the model you previously used? If so, you may have to install some new water lines to accommodate that new appliance.

Adding new water lines to your property will not come cheap. Plumbers will likely charge $1,100 for that kind of installation. You can also expect the price to fluctuate based on the layout of your property.

New Electric Lines

Now that you’re making the switch to an electric water heater, you may need to add some wiring to your basement. Adding new wiring to your home will cost $1,400.

Electricians also have to worry about insulating the wires and introducing other safety measures. Doubling up on those safety measures is important if you’re installing new wiring for a water heater.

New Gas Lines

Gas-powered water heaters may need additional accommodations too. You may need to add a new gas line as well. Adding that new gas line will cost $550.

Wall Alterations

Now that you’re replacing your water heater, you may also have to modify the room that’s housing it. That could mean carving out more room for the larger tank or creating space for the additional water, electric, or gas lines.

Making those modifications to your basement or whichever room you’re using to house the water heater will be costly as well. Don’t be surprised if you end up spending thousands of dollars on those modifications.

Do You Need Water Heater Installation or Replacement?

Get free, zero-commitment quotes from pro contractors near you.

Related Questions

What Is the Life Expectancy of a Water Heater?

Replacing the water heater is not something you’ll have to do very often. As long as you pay attention to maintenance, water heaters can last for 10 years.  If you’re having a tough time choosing between the available options, you should know that electric water heaters are slightly more durable.

What Are the Signs Your Hot Water Heater Is Going Out?

The symptoms of a failing water heater are pretty easy to spot. Those symptoms manifest themselves as leaks, discolored water, and loud noises.The water pressure for that appliance may also dip as it ages. Speaking of age, you can refer to that too when determining the appropriate time to replace your water heater.

Can a Water Heater Explode?

Yes, water heaters can explode. That can happen if the appliance was not installed properly. Improper usage of the appliance can also lead to that kind of disaster.

Gary Evans
Gary Evans

Gary Evans is passionate about home improvement. He loves finding out how to make improvements in the easiest, most practical, and most affordable ways. Upgrading his home kitchen is one of his ongoing hobbies. Gary is also a long-time content creator and enjoys spending his free time tending to his hydroponic vegetable garden.

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