What is the downside of a tankless water heater?

Author: Abdullah Rice  |  Last update: Monday, September 8, 2025

The biggest disadvantage of tankless water heaters is the initial cost. While they can last longer and have lower operating costs that can help offset the higher initial cost, it will take quite some time to realize the savings. Limited hot water supply.

Why avoid a tankless water heater?

Additional Installation Costs

Tankless water heaters are much more complex than traditional hot water tanks. As a result, they require professional installation. If you're switching from a hot water tank to a tankless unit, you will likely need your gas lines rerouted, as well as a larger gas supply line.

Is it worth switching to a tankless water heater?

Switching to a tankless water heater can help you save on your energy costs, with potential savings of up to 50%, according to the U.S. Department of Energy. Additionally, tankless water heaters are reported to be 24% to 34% more energy efficient than storage tank water heaters by the same source.

What are the negatives to a tankless water heater?

Disadvantages of Tankless Water Heaters
  • Higher upfront costs. Tankless water heaters are, on average, quite a bit more expensive to buy and install than tank water heaters.
  • Access to fuel. ...
  • Water softener requirements. ...
  • Flow rate limitations. ...
  • Need for multiple units.

What is the life expectancy of a tankless water heater?

A tankless water heater can last anywhere from 15 to 20 years with proper maintenance and operation. In comparison, a standard tank water heater normally has a working life of 10 years or less. How Do Tankless Water Heaters Work?

PROS and CONS of Going From a TANK to TANKLESS Water Heater

Do tankless water heaters need to be flushed every year?

Over time, a tankless water heater may accumulate mineral build up which can erode the walls inside your tank's heating chamber. To properly maintain and clean your tankless water heater, it's important to flush those mineral deposits at least once a year.

Why don't more people use tankless water heaters?

Some people hesitate to decide on a tankless water heater because they can be a slightly higher cost; however, you get significantly more life out of one. A standard water heater tank lasts about 8-12 years. A tankless water heater can last as long as 25 years!

Can I replace my 40 gallon water heater with a tankless water heater?

Absolutely! In fact, tankless water heaters are becoming the standard for new home construction because of the energy efficiency.

Can you take a long hot shower with a tankless water heater?

While a tankless water heater will deliver an unlimited stream of hot water, they struggle to deliver a lot of hot water at one time. So while you might be able to take 100 showers in a row if you have the dishwasher, washing machine, and shower going at the same time you might have problems.

Where should tankless water heater not be installed?

Keep your water heater away from outside elements

If your tankless heater is exposed to extremes weather conditions, it will run a greater risk of premature failure. So, make sure your appliance is away from doors and windows, and never installed in the garage or basement.

Is there an IRS tax credit for a tankless water heater?

The federal tax credit for tankless water heaters in 2024 is an excellent opportunity for homeowners to save money while investing in energy-efficient water heating solutions. This tax credit is effective from January 1, 2023, to December 31, 2032.

What is not a benefit of a tankless water heater?

A tankless water heater cannot provide hot water faster than its ability to heat the water. While a tank unit can provide hot water for multiple uses at once, a tankless unit might not be able to support simultaneous usage, such as washing dishes, taking a shower and running a washing machine all at once.

Do tankless water heaters increase the electric bill?

Because tankless water heaters only consume energy when you need hot water, they're more energy efficient, saving you money on water and energy bills.

Should I replace my water heater with a tankless?

Tankless water heaters can save you money on your energy bill in the long run, but they also require a greater initial financial investment upfront. Installation costs more, especially if you're installing your first tankless heater and require new gas lines and venting or a dedicated electrical circuit.

What maintenance does a tankless water heater need?

The most complicated and time-consuming tankless water heater maintenance is typically descaling and flushing out the unit. Even with the inline water filter, lime and calcium deposits can build up inside the tankless system. If you have hard water, it's a good idea to descale and flush the unit once a year.

Do you ever run out of hot water with a tankless water heater?

You can't run out of hot water with tankless water heaters – unless, of course, the power supply is off or goes out. However, a tankless water heater can have trouble keeping up with demand if too many things require hot water all at once.

What are the downsides of tankless water heaters?

Tankless water heaters have several drawbacks and disadvantages, including a higher initial cost, limited flow rate, specialized venting requirements, potential need for additional equipment, limited hot water supply, delayed hot water delivery, mineral buildup and maintenance, complexity of installation, dependence on ...

Can you run 2 showers with a tankless water heater?

The right tankless water heater can definitely take care of all your family's hot water needs, including taking multiple showers at once. If you're considering upgrading to a tankless water heater, it's essential to work with experienced professionals.

Why does my shower go cold after a few minutes tankless water heater?

One possible reason for a tankless water heater going cold after a few minutes is the occurrence of a cold water sandwich effect. This happens when the unit is turned on and the initial cold water mixes with the hot water, resulting in an inconsistent flow of hot water.

Who makes the best tankless water heater?

Top Tankless Water Heater Brands in 2025
  • Noritz.
  • Navien.
  • Rinnai.
  • Takagi.
  • Rheem.

Why do tankless water heaters fail?

Mineral buildup, often caused by hard water, is a common problem for tankless water heaters. Over time, minerals such as calcium and magnesium can accumulate inside the heat exchanger, reducing its efficiency and potentially leading to long-term damage.

Can you replace a 50 gallon water heater with a tankless water heater?

A 50-gallon water heater should be replaced with a tankless system with a 10 GPM flow rate just to be safe. Selecting the right flow rate ensures you won't experience cold showers or excessive energy costs. Proper sizing optimizes performance, providing hot water on demand without unnecessary waste.

When to not get a tankless water heater?

Cons
  1. Initial Cost — While tankless water heaters can provide substantial savings over time, the initial cost outlay can be prohibitive. ...
  2. Shared Hot Water Output — If you try to save money and purchase a smaller unit, you may not be able to comfortably shower or shave while you're running your dishwasher.

Why not buy an electric tankless water heater?

You might want to avoid a tankless water heater due to its higher upfront cost. Another downside is the possible upgrades to your gas line or electrical system required to install one.

Why is tankless water heater installation so expensive?

Installing a tankless water heater can require gas line upgrades, electrical modifications, and specialized venting—all of which can increase costs. Professional labor also runs from $500–$1,500 due to complex installation requirements.

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