How much does it cost to install a gas water heater?

Reviewed by Cristina Miguelez remodeling expert. Written by Fixr.com.

Hot water is an important and integral part of every home. Cooking, cleaning, and bathing require hot water daily. If you have a natural gas line or use propane for your home heating needs, a gas hot water heater may be a good fit. Like other water heaters, they come in different types, including storage tanks and tankless styles. There is a range of costs for this project, depending on the unit type and size.

The national average cost to install a gas water heater is $1,000 to $2,500. Most pay around $1,200 for an installed 50-gallon storage-style water heater with a direct vent. This project’s low cost is $600 for an installed point-of-use tankless heater. The high cost is $4,000 for a hybrid tankless unit with a small storage tank, fully installed.

Cost to Install Gas Water Heater

Gas Water Heater Cost by Type

Most gas water heaters come in two types - tank and tankless. A small portion of companies makes a hybrid model. Tank-style heaters are large units that hold hot water until you need it. Tankless models heat on-demand and can be point-of-use, designed for heating water to a single source, or large enough to provide water to the entire house. Hybrid models work like tankless units but hold a small amount of water in reserve for instant hot water while the remaining heats. All types have costs and attributes to consider.

Tank Gas Water Heater

The average cost of a tank-style gas heater is $400 to $1,500. Tank-style heaters are designed to provide water to the entire home. They are sized based on your hot water needs. The more you use, the larger the tank you need. Tank-style heaters are less efficient than tankless heaters because they are constantly heating your water to be ready. They are less expensive than tankless models and easily provide to multiple points, but they are also much larger. They should be installed near an exterior wall for venting.

Tankless Gas Water Heater

The cost of a tankless gas heater averages $500 to $2,000. This type of heater only heats the water as you need it. They do not hold water in reserve, so they are usually more efficient than tank-style heaters. They are installed inside your walls to use less space. You may opt for one or more point-of-use heaters, depending on your home’s size. Or, you can choose a whole-house unit that heats water for multiple rooms.

Hybrid Gas Water Heater

The price of a hybrid gas water heater ranges from $1,400 to $3,000. These are a blend of tank and tankless heaters. They hold a small amount of hot water, roughly 3 to 3.5 gallons. This means they are more efficient than tank-style heaters but provide you with more hot water quicker than most tankless heaters. Not every brand makes a hybrid heater, and those that do often have limited sizes. These are only recommended if you need a whole-house tankless unit and want to add a small reservoir of heated water to ensure consistent use at multiple points.

Gas Water Heater Prices by Source

All gas water heaters can run on natural gas and propane. Propane may be a better fit than oil or electricity because natural gas is not available in all areas. If you already have propane for your home heating, it is easy to use it for your hot water. The price of the units and installation is identical because the same unit can use both fuel types.

Natural Gas Water Heater

The cost of natural gas hot water heaters is $400 to $3,000. They make sense if you have natural gas supplying your home with fuel for heating and cooking. You must have a gas line from the main on the street to your home to use natural gas. It then runs to the heater to fuel it. You must extend your gas line if you switch from electric to natural gas, increasing the project costs. This is true regardless of the unit type.

Propane Water Heater

The price of a water heater that runs on propane averages $400 to $3,000. All gas heaters that run on natural gas can also run on liquid propane. Some come with a conversion kit your installer uses during setup, while others run on both fuels with no modifications. Propane is delivered to your home and stored in large tanks until needed. You need a line from your tanks to your water heater for it to run. Like heaters that run on gas, this is true regardless of the heater or where it is installed. Propane is a good option for those who do not have access to natural gas or pay the higher electricity costs.

What Size Gas Water Heater Do I Need?

Water heaters are typically sized based on two things - home size and usage. The more people you have living in your home, the more hot water you use regularly. Washing machines and dishwashers also use more than homes without these appliances.

Tank-style heaters are sized by the gallon. A small tank holds about 20 gallons, which is enough for a single user with low-to-moderate hot water needs. A large tank holds about 80 gallons, enough for a very large household or performance shower using up to 20 gallons a minute. Most families with about 4 family members find a 50-gallon heater fits their needs. Larger families or households with more than 2 bathrooms that could be in use simultaneously may want to size up to a 60-gallon gas hot water heater or larger. However, most people find a 50-gallon heater suits their daily needs.

Tankless heaters are sized by GPM - gallons per minute. The higher the output, the higher the GPM. Because tankless heaters can be used point-of-use, meaning you install one for your kitchen, one for your bathroom, one for your laundry room, and whole-house use, you can have a range of sizes. The more appliances used at once, the more GPM your tankless heater must produce.

Tankless heaters made for an entire house are usually sized by the number of bedrooms. A 3-bedroom home needs 5 to 6 gallons per minute, while a 4-bedroom home needs 6 to 7 gallons per minute. The exact number of gallons per minute depends on your daily usage. Keep in mind performance showers use up to 20 gallons a minute, and while not all of that water is hot, your heater must be capable of producing enough heat to satisfy the demand.

If you are not sure how many gallons per minute you use, use this calculator by Energy.gov to calculate the correct heater size for your home.

Gas Hot Water Heater Cost by Capacity

Tank-style heaters are sold by the number of gallons of hot water they can heat and hold at once. The more they can hold, the more hot water your household can use continuously or at once. The more users who need daily hot water, the bigger the tank you should invest in.

Tankless Gas Heater Cost by Capacity

Tankless heaters are sold by the number of gallons of hot water they produce in a minute. This is labeled as GPM or gallons per minute. Small single point-of-use heaters only heat a few gallons per minute. These are good for additions where you do not want to tie them into your system.

However, ensure you have enough hot water for anything in a whole-house system. This means if someone is running a hot water tap in one room, another person is showering, and a third person is washing the dog, you want to ensure the heater can produce enough hot water per minute to meet those needs. Below is the average price for different sizes of tankless gas heaters and their number of recommended users.

Gas Water Heater Cost by Brand

Many reputable brands of water heaters are on the market. Some make tank and tankless styles, while others may only make tankless. Costs are based primarily on size - some tankless brands can carry small point-of-use heaters, while others only carry whole-house heaters. Each brand has different features making one of them the right fit for you. Below are the average prices for each brand and the type they make.

Marey Gas Water Heater

Founded in 1955 by Mariano Reyes, the company started in Puerto Rico and expanded around the world. The price of Marey gas water heaters is $200 to $700. Marey makes small economy-sized tankless heaters. They do not currently have a range of tank models. Their units are mostly designed for point-of-use, meaning they handle a single appliance’s or room’s worth of hot water at a time. This makes them a good choice for apartments, small homes, and bathroom additions. You need several units if you want the unit for a larger home.

Camplux Water Heater

The price of a Camplux heater averages $300 to $700. Camplux makes a range of small point-of-use tankless heaters. They do not sell tank-style heaters at this time. Their point-of-use heaters are designed for additions, single room use, and small apartments and RVs. If you want to use them in multiple rooms or a larger home, you need several heaters. Their heaters have several options that make them easy to use and eco-friendly.

Noritz Gas Heater

The price of a Noritz gas water heater ranges from $500 to $1,700. Noritz makes a wide range of high-efficiency tankless units. They do not make tank-style heaters at this time. Noritz heaters are designed for whole-house use. They have high capacity, with outputs above 9 gallons per minute. These are often highly rated units with exceptional warranties designed to produce high-volume hot water for many years.

Takagi Gas Water Heater

The price of a Takagi gas water heater is $600 to $1,400. Takagi is a producer of high-end and high-efficiency tankless-style units. They do not make tank-style heaters at this time. Takagi units are designed to meet the needs of an entire house, including larger homes and homes with multiple occupants. Their heaters are capable of outputting over 9 gallons per minute.

Rheem Gas Heater

The price of a Rheem gas water heater ranges from $670 to $2,000 for tankless models. Tank-style heaters price between $500 and $2,000. The company has been around since 1925 and originated in Emeryville, California. Rheem makes a very large range of units. They start at small point-of-use tankless heaters and go up in size for larger homes. They also have some large tank-style heaters that can handle significant hot water needs. Rheem is one of the largest manufacturers, meaning they have more options and sizes.

EcoSmart Pricing

The price of an EcoSmart gas heater averages $700 to $1,600. EcoSmart makes a range of energy-efficient tankless heaters. They range from small point-of-use heaters for a faucet to larger units that can handle a few appliances at once. These heaters can be installed in apartments, RVs, or tiny homes. They are not designed for large homes, but you could install more than one. The heaters are designed to be easy to use and give you good performance while saving energy.

A.O. Smith Gas Water Heater

The price of an A.O. Smith unit averages $800 to $1,500 for a tankless unit. The price of a tank-style heater is $600 to $1,200. Their heaters are designed for whole-house use. Their tankless models have high flow capacity, meaning they can have outputs above 9 gallons per minute. Their tank-style heaters come in several sizes, allowing you to find a model that fits your needs. Their units have several options for venting, condensing, and installation style.

Westinghouse Gas Heater

The price of a Westinghouse gas heater averages $900 to $2,700 for a tankless model. Their tank-style heaters range between $800 and $2,000. Westinghouse makes a wide range of high-quality heaters. These units are usually condensing, with power and direct vent options. They also make a line of hybrid heaters that can hold roughly 3.5 gallons of hot water in reserve. Their heaters are designed to give you ultimate performance and ease of use while remaining eco-friendly.

Rinnai Gas Water Heater

The price of a Rinnai gas heater is $1,000 to $1,700. Rinnai makes a wide range of tankless heaters. They do not currently make tank-style heaters. Rinnai’s heaters are designed for the entire house. They have several heaters with high capacity, meaning they produce more than 9 gallons a minute. This is ideal for large and busy families who may have a lot of hot water needs.

Bosch Gas Water Heater

The price of a Bosch gas heater is $1,000 to $2,250 for a tankless style heater. Bosch is a German company, well-known for its high-quality heaters. They make tankless heaters in a range of sizes, most designed for whole-house use. They have several installation styles available and produce hot water above 9 gallons per minute. Their heaters are known for being extremely dependable and lasting for years. Some of their higher-end models are also exceptionally energy-efficient and produce a high output of hot water.

Bradford White Gas Water Heater

The price of a Bradford White gas heater averages $1,000 to $3,850 for a tankless unit. Their tank-style heaters range between $500 and $4,000. Bradford White makes a large range of heaters in multiple sizes, including some commercial-size heaters. This is often the preferred brand for builders due to its exceptional quality and ease of installation. They have a range of energy-saving models in their tank and tankless lines. They also have several tankless heaters that can produce a very high volume of hot water.

​​Navien Gas Tankless Heater

The price of a Navien gas tankless water heater ranges from $1,100 to $1,800. Navien makes a range of whole-house tankless units. They do not produce tank-style heaters. Navien makes a range of high-efficiency non-condensing heaters. They are designed to offer endless hot water to every room of the home, no matter how many appliances are used at once. These are high-end heaters made of premium materials and built to meet your hot water needs for years with little maintenance.

​​Labor Cost to Install a Gas Water Heater

Purchasing your heater is only one part of your total costs. You also have costs for the labor and installation. Each heater has an installation cost based on type, location, how it vents, and whether you must run or extend a gas line to reach the heater. Below are the average installation costs for each heater type.

Gas Water Heater Installation Cost (Tank)

The average cost to install a tank-style gas heater is $270 to $1,500. This makes for a total cost range of between $670 and $3,000. Tank-style heaters are generally the fastest and easiest to install. They sit out in the open, beside a wall they vent through. They must connect to your gas line and plumbing. Costs vary depending on the unit’s vent type and if there was already a heater in this area or if the area must be modified for the heater.

Tankless Gas Water Heater Installation

The cost to install a tankless gas hot water heater ranges from $500 to $1,700. This makes for a total cost range of $1,000 to $4,500 on average. Tankless heaters are more difficult to install. They require you to open the wall where they are concealed and cut pipes to make room for them. They are connected directly to your water supply pipes. Unless this is a replacement, you also must run a gas line extension to where it is installed. This has a range of costs, depending on the location, and does not include wall repairs.

Hybrid Gas Water Heater Installation

The cost of installing a hybrid gas water heater averages $400 to $2,000. This makes a total cost range of $1,800 to $5,000. Hybrid units install like a tankless heater. This means it is placed inside a wall, the pipes modified to fit, and a gas line run. The biggest difference is this style has a small storage tank, limiting the places where you can install it.

Cost to Install a Gas Water Heater by Type of Vent

All gas hot water heaters must vent outdoors. They do this in one of two ways: passively out of a wall or assisted. The first method is called a direct vent and is generally less expensive in material and labor. The second method is called a power vent, and it vents the unit in areas where direct venting is not an option, meaning it can be installed much farther from an outside wall. Both heaters have a range of costs for the unit and installation.

Gas Water Heater Direct Vent

The cost of a direct vent gas heater averages $670 to $4,000, fully installed. Direct vent gas heaters are the most simple type. They do not have moving parts, so they break down less frequently. They also function without electricity so that you still have hot water in an outage. They must be installed beside an outside wall, however. They need to be within a few feet of the wall to make venting easier, limiting where you place them.

Power Vent Gas Water Heater

The price of a power vent gas water heater is $1,050 to $5,000, fully installed. Power heaters are more complex. They have moving parts that require electricity to direct the off-gasses to the vent. They can be installed much farther away from the wall, meaning they have more placement versatility. However, they do not function during an outage, even when they run on gas. When operational, they are much more efficient at moving gases out of the area than a direct vent unit.

Cost to Replace a Gas Water Heater

The cost of replacing a gas water heater is similar to installing one, $1,000 to $2,500 on average, depending on the model and installation type. Many companies remove your old unit at no cost if you purchase the new unit from them. Others charge $25 to $200 to remove and dispose of the old unit. The other costs are for the new unit and its installation. Your costs could be different if you require new pipes, gas lines, or other modifications.

Gas Water Heater Cost per Month

The cost of running your gas heater each month depends on several factors. These include the cost of gas, your unit type, how efficient it is, and how much hot water you use each day. According to the Energy.gov use calculator, a household using 64 gallons a day in a standard-efficiency heater has annual energy costs of $105 to $152. Divided by 12, this gives you an average monthly cost range of $8.75 to $12.67 per month.

Maintenance

You should perform regular maintenance on your gas tank-style unit to help it work best. Tankless-style heaters are generally considered low-to-no maintenance because of their position inside the wall. They cannot be reached for regular service and do not have storage, which contributes to problems.

Drain and flush the tank periodically to maintain your tank-style heater. This means turning off the gas or blowing out the pilot light to the tank, finding the valve, and emptying the tank. This flushes sediment from the bottom of the tank. Once the valve is back in place, you can refill the tank and reignite the pilot.

You should also periodically check the pressure valve to ensure it is working and visually inspect the unit’s exterior for signs of rust, which can be an indication it is aging and may need replacing.

Gas Water Heater Energy Efficiency

Like all appliances, gas heaters can have a wide range of efficiencies. They are rated by an Efficiency Factor (EF). A standard tank-style heater has an EF of .58 to .60, meaning 58% to 60% of the fuel heats your water. A high-efficiency model has EFs starting at .68 and may go as high as .98. All tank-style heaters decline in efficiency from mineral and sediment build-up.

Tankless models are around 8% to 14% more efficient than tank-style heaters.

Gas Water Heater vs Electric

Gas heaters are not the only type available. You can also use electric heaters, which use electricity to power the unit and heat the water. Of the two, electric heaters are generally less expensive to purchase and install. However, they are more costly to run. Electric heaters also do not function when the power goes out. This means you have no hot water if there is an outage. Most gas units do not rely on electricity and continue to provide hot water in an outage. Additionally, electric heaters have no safety concerns and are easier to maintain.

Yearly Costs for Gas vs Electric Tankless Water Heaters

Costs for gas and electric tankless water heaters vary depending on the cost of gas and electricity, the unit size, and how much hot water you use. According to Energy.gov, the average costs to run a gas heater per year are between $105 and $152. The average costs to run an electric unit are between $276 and $305, making gas heaters less expensive to run.

Condensing vs Non-Condensing Gas Water Heater

Tankless gas hot water heaters also come in two types - condensing and non-condensing. Non-condensing units were the standard until a newer focus was put on energy efficiency. In a standard non-condensing unit, the exhaust and the heat it carries is vented immediately. In a condensing unit, heat is condensed first, capturing it and raising the efficiency before venting what is left. This means a condensing heater is more efficient and vents exhaust less frequently than a non-condensing unit. Non-condensing units tend to be less expensive but cost more to run long term.

Enhancement and Improvement Costs

Smart Water Heaters

Many high-efficiency heaters today are considered smart. This means they have wi-fi capability and often have diagnostic software that allows you to troubleshoot issues easily. Some also operate via an app, letting you turn down the temperature when you are not at home. They cost between $700 and $2,000. There are also smart thermostats that connect directly to your boiler or heater.

Expansion Tank

In some units, the heated water expands to the point where it can no longer fit inside the tank. When this happens, it can be captured and stored in an expansion tank. These smaller tanks sit outside the main tank and come in several sizes. They range from $50 to $300, depending on the size. Some cities may require expansion tanks for homeowners.

Heater Insulation

Many newer hot water tanks come insulated to reduce energy costs. However, if you have an older model, you may want to insulate it to save money. Insulation typically costs $80 to $150, depending on the size.

Timer

For some units, a way to save money is to shut off your heater during the hours when no hot water is needed. You can turn it on again with enough time to heat the water before it is needed. Timers control this function more easily and cost $50 to $125.

Water Heater Straps

Water heaters are extremely heavy. They could cause significant damage if they shift, move, or fall in an earthquake or other catastrophe. Water heater straps help hold them safely in place. They cost about $20 for the average set.

Sediment Trap Water Heater

A common problem with this type of hot water heaters is sediment that may enter through the gas line. This sediment can build, eventually lowering your heater’s efficiency. A sediment trap installs on the end of the line and prevents it from entering. They range around $30 to $50 each and should be installed with the heater.

Additional Considerations and Costs

• Old unit removal. When replacing a heater, the old unit must be removed first. Many companies do this at no charge, but others charge $25 to $200 to remove and dispose of the unit.
• Warranty. Most units have a warranty of roughly 6 years, with 1 year on labor. This varies by manufacturer.
• Lifespan. Water heaters last from 10 to 15 years, with many lasting longer.
• Safety concerns. Ensure your unit is vented properly and your gas line is correctly installed and maintained. Leave the property immediately and contact your local gas company if you smell gas.
• Permit. Depending on where you live, you may need a permit to install a new unit. This ranges between $100 and $300. Speak to your installer about whether a permit is needed.
• Site preparation. Depending on where the new unit is installed, some site preparation may be needed. This might include extending a new gas line, opening walls, or cutting holes for vents. This may raise your project’s cost, depending on what must be done.
• Repair. If your unit stops working, it can frequently be repaired. The average cost to repair a gas water heater is $150 to $750, with diagnostic fees of around $90. They have a few different components where issues might arise, such as the burner, control valves, the anode rod, or even the tank.
• Indirect water heater. It uses the heat produced by your furnace or boiler to heat your water. This is not always a good solution, particularly in the summer months, but it can save on energy costs in the winter. The cost of these units is around $1,500 to $3,000. These units are large and require additional space beside your furnace or boiler.