Cost to Install a Tankless Water Heater

It costs $2,800 to $6,500 to install a tankless water heater in 2026 for a whole-house gas model. The heater itself is only $1,000 to $2,200. Most of the bill is labor plus the gas line, the venting, and any water treatment the unit needs.

Electric tankless units cost less to buy, but they often trigger an expensive electrical upgrade. Below is the full picture for both.

What It Costs to Install a Tankless Water Heater in 2026

A gas condensing unit is the common choice, and it installs for $3,500 to $6,500. A non-condensing gas unit is cheaper at $2,800 to $4,500, but it needs pricier stainless venting and costs more to run.

Electric whole-house tankless heaters install for $1,500 to $4,000 on their own. The problem is amperage. These units pull 80 to 150 amps, so many homes need a panel upgrade first, which adds $1,300 to $3,000.

A small point-of-use electric heater under a single sink is the budget option at $150 to $600 installed. It only serves that one fixture, though, so think of it as a supplement rather than a whole-house solution.

The spread on those numbers is wide because a tankless install touches four trades at once: plumbing, gas, venting, and electrical. The unit is the small part. The connections around it are where the money goes, and the sections below break each one out.

Gas vs. Electric Tankless

Gas units heat more water per minute, so they suit larger homes and colder climates. They need a dedicated vent and, in most retrofits, a larger gas line. That gas line upsize is the single biggest surprise on a gas quote.

Electric units are simpler and vent-free, which lowers labor. But the electrical demand is high. If your service is already near capacity, the required upgrade can cost more than the heater. Check your panel before you commit.

Running cost also splits the two. A gas condensing unit is usually cheaper to operate where natural gas is available. Electric makes more sense in all-electric homes, in mild climates, or where you plan to add solar.

For most families replacing an aging gas tank, a gas condensing unit is the long-term value. Our cost to replace a water heater guide compares the tank and tankless paths side by side.

Where the Money Goes

The unit is 30 to 40 percent of a gas install. Labor is another large share, because the work involves gas, water, venting, and often electrical for the ignition and controls.

A gas line upsize runs $300 to $1,500, depending on how far the run is from the meter and whether the wall has to be opened. Stainless steel venting adds $200 to $1,000, and it has to terminate a set distance from windows and soffits.

A permit and inspection add $100 to $500. Most cities treat a tankless conversion as a larger job than a tank swap, so the fee is higher and the inspector checks the gas sizing and the vent clearances.

Many installers also add a scale filter or recommend a softener, which is $150 to $600. Hard water is the top cause of early tankless failure, so this is money well spent. See our Plumbing cost guides for water treatment pricing.

What Drives the Price Up

A long gas run, a difficult vent path, or a heater location far from the panel all add labor. A second story, or a finished wall that has to be opened and patched afterward, adds more still.

Whole-house coverage costs more than a single-bathroom setup, because the unit has to be larger and the plumbing reworked to feed it. Recirculation, if you want instant hot water at distant taps, adds a pump and a return line for $400 to $1,200.

Climate matters more than people expect. Groundwater in a northern state can arrive at 40 degrees in winter versus 70 in the South. To hit the same shower flow, the cold-climate home needs a bigger, pricier unit, or two units plumbed in parallel.

Hard water forces either a softener now or yearly descaling later. If your unit is already tankless and just running weak, our cost to flush a water heater guide covers descaling, which is the tankless version of a flush.

Is Tankless Worth It?

A tankless heater lasts 15 to 20 years, roughly double a tank. It uses 8 to 34 percent less energy, per the Department of Energy, and it never runs out mid-shower. Over its life, the energy savings often cover the higher install cost.

It is not worth it for everyone. If you rarely run out of hot water, plan to move in a few years, or have a tight electrical service, a high-efficiency tank is the smarter spend.

Also weigh the "cold water sandwich." A tankless unit takes a second or two to fire, so back-to-back uses can send a slug of cool water down the line. A small buffer tank fixes it for about $300 if it bothers you.

You can confirm current savings and federal tax credits on the Department of Energy tankless page before you decide.

Point-of-Use vs. Whole-House

A whole-house tankless unit replaces your tank and feeds every fixture. That is the $2,800 to $6,500 job above, and it is the right call for most homes.

A point-of-use unit is a small heater mounted right at one fixture, usually a far-off bathroom or a workshop sink. It costs $150 to $600 installed and cuts the wait for hot water at that spot to nothing.

People often use the two together. Keep an efficient tank or a modest whole-house unit for the main house, then add a point-of-use heater at the one fixture that always ran cold. It is cheaper than upsizing the main unit to cover a long pipe run.

Maintenance and Running Costs

Budget for a yearly descale. A plumber charges $150 to $250. A DIY kit is $100 to $170 the first year, then about $15 a year for solution. Skip it in a hard-water area and you can halve the unit's life.

Also plan to replace the water filter screen and, on some models, the igniter or flame rod over a 20-year span. None of those parts is expensive, but they are the difference between a unit that reaches 20 years and one that quits at 12.

How to Keep the Cost Down

First, get three quotes from installers who fit tankless units weekly, not once a year. Experience here shows up directly in the labor line and in fewer callbacks.

Second, keep the heater near the existing gas meter and vent path. Every extra foot of gas line or venting adds cost. Third, ask whether your current gas line is already sized correctly, because some homes do not need the upsize at all.

Fourth, check for utility and manufacturer rebates before you sign. High-efficiency gas units often qualify for $150 to $600 back, and that offer changes by season.

Finally, size the unit to your real peak demand, not the biggest model on the shelf. An oversized unit costs more up front and short-cycles, which wears it faster.

Bottom Line

Plan for $3,500 to $6,500 to install a tankless water heater in 2026 for a whole-house gas model, or $1,500 to $4,000 for electric before any panel work. The gas line, the venting, and hard-water treatment are where quotes diverge, so ask each bidder to itemize them.

If your goal is the lowest first cost, a high-efficiency tank still wins. If it is lifespan, space, and endless hot water, tankless earns its premium. A yearly descale, similar to the flush covered in our water heater repair cost guide, keeps it running the full 20 years.