How Much Does Water Heater Replacement Cost?

As a major home system tied to daily comfort and energy use, replacing a failing or outdated water heater is an inevitable need for most homeowners. But what should you budget for this essential upgrade?

This comprehensive guide examines the full costs of water heater replacement. We’ll overview the different types of heaters, compare installation options, calculate sample pricing, highlight expert cost-saving tips, and outline long-term cost considerations to help you make the most informed decision.

How Much Does Water Heater Replacement Cost?

The typical cost of a water heater replacement ranges from $500 on the low end for a basic electric tank model with DIY installation, up to $3,500 on the high-end for a large, high-efficiency tankless gas system installed professionally. Most standard tank water heater replacements fall between $1,000-$2,000 depending on size, features, and labor costs.

To understand how costs add up, here is an example price estimate for replacing a standard 50-gallon gas storage tank model:

• New water heater unit – $550 for a mid-range model from Rheem or A.O. Smith
• Professional installation labor – $500 assuming 5 hours at $100 per hour
• Permit fees – $50 typical for many municipalities
• Old tank disposal fee – $100 approximately
• Venting, connectors, shut-off valves – $150 in miscellaneous parts

Total estimated installed cost: Approximately $1,350

This reflects a fair real-world price range, but your actual costs will vary based on local rates, complexity, and other factors.

According to an article from Bob Vila, the typical cost to replace a water heater ranges from $874 to $1,765, with a national average around $1,293. This price includes both the unit and installation costs, which can vary based on local labor rates and specific requirements.

Another source, Barnett Plumbing, provides detailed insights into costs specific to California. They report that the average cost for replacing a gas water heater is between $2,000 and $3,500, while electric water heaters typically range from $2,000 to $3,000. For tankless water heaters, costs can escalate significantly, averaging between $7,000 and $11,000 due to higher equipment and installation expenses.

A report from Carter’s My Plumber indicates that the average cost for water heater replacement is around $3,550, with prices ranging from $1,600 to $5,500. They emphasize that the type of water heater—gas or electric—impacts overall costs significantly. For gas water heaters specifically, replacement costs can range from $700 to $2,700.

According to an overview on Jacob’s Heating, replacing a traditional tank unit generally costs between $2,500 and $3,000, while more advanced systems like heat pump water heaters may cost between $3,000 and $4,500. They highlight that installation complexity and additional features can drive up these costs.

Lastly, a discussion on Reddit reveals that users have reported varying costs based on their personal experiences. One user mentioned a total replacement cost of about $2,500 for a 50-gallon natural gas water heater with additional features included. Others indicated that their replacements ranged from around $1,700 to over $4,000, depending on specific circumstances such as accessibility and type of unit.

Water Heater Types

There are two major categories of water heaters, each with different attributes affecting price:

Standard storage tank heaters – Most common type with low upfront cost. Gas models range $400-$1,500 installed, electric $500-$1,800.

Tankless on-demand heaters – Compact and energy-efficient but higher initial price of $1,100-$3,500 installed.

Additional varieties carrying premium pricing include:

Heat pump water heaters – Energy efficient with solar benefits but higher first cost around $1,500-$2,500 installed.

Solar water heaters – Harness free solar energy but require substantial $3,000-$7,000 installation investment.

Factors Influencing Replacement Costs

Several critical considerations affect the total replacement price:

• System size – Larger tank capacities or higher hot water flow rates mean higher costs. Right-size based on household demand.
• Energy source – Electric heaters are typically cheaper upfront to purchase but more expensive long-term to operate vs gas models.
• Energy efficiency rating – High-efficiency systems incur higher first costs but can yield significant energy savings over their lifespan.
• Labor – Professional plumber hourly rates range $50-$150. Complex installs with venting upgrades or drain pan requirements take more time and expense.
• Additional parts/materials – Needs like new venting, wiring, permits, tank disposal add incremental costs that quickly add up.
• Brand – Leading manufacturers like Rheem and Bradford White command a price premium for enhanced quality, warranties, and service reputation.

Carefully weighing these cost factors allows you to balance upfront price against long-term value and savings.

DIY or Hire a Professional?

To save on plumber labor, is DIY replacement advisable? Consider the key tradeoffs:

DIY Pros

• Saves $500+ on labor costs
• Satisfaction of self-completing a major home project

DIY Cons

• Requires intermediate plumbing, gas fitting, electrical skills
• Safety risks if pipes aren’t properly sized, vented, sealed
• No installation warranty or liability protection if issues arise

Professional Pros

• Expertise ensures optimal sizing, efficient, safe install
• Warranty and liability coverage provides peace of mind
• Handling of permits and old tank disposal included

You might also like our articles on the cost of installation of a 50-gallon water heater, a tankless water heater, or a water heater from Home Depot.

Professional Cons

• Adds $500-$1,000+ in labor costs to the total price

For most homeowners, hiring a licensed professional reduces risks and provides long-term value that likely justifies the higher upfront costs.

Reduce Water Heater Replacement Costs

While upfront costs may be daunting, various strategies can yield significant savings:

• Exploring rebates from energy companies – $250+ in many areas as incentives for efficient models
• Shopping discounted sales during off-peak seasons when demand is lower
• Purchasing the right system capacity for your household, not oversized
• Comparing multiple installer quotes to find the best rate

Taking time to research and plan optimizes the balance of affordability and value in your replacement investment.

Popular Brands

When choosing a replacement water heater, leading brand names to consider include:

• Rheem – Known for reliability, performance, warranties, established reputation
• A.O. Smith – Excellent energy efficiency and longevity based on proven designs
• Bradford White – Renowned for quality construction, competitive retail pricing
• Rinnai – Leading global manufacturer of tankless water heaters

Seeking Energy Star certified models from highly-rated brands ensures a wise long-term system investment.

Maintenance and Lifespan

While replacement costs typically range $1,000 to $2,000, also project long-term costs:

• Higher efficiency systems have higher upfront costs but can yield over $100 yearly savings on energy bills over their roughly 10-year lifespan.
• Regular maintenance like flushing sediment extends a water heater’s life significantly before requiring replacement again.
• Set aside a budget monthly in savings to prepare for the future replacement cost, spreading out the burden over time.

Maximizing Water Heater Value

We asked licensed plumbers and HVAC pros to share their insights on getting the best replacement value:

• “When sizing the new system, be sure to account for any planned additions like a basement kitchen or expansion. A few gallons larger capacity leaves room for growth.” – Jessica T., Plumbing Company Owner
• “Tankless seems appealing, but maintenance issues over time can make simpler tank heaters a better, more affordable choice long-term for many homes.” – Andrew R., HVAC Technician
• “Don’t underestimate the value of professional installation – it’s your family’s safety and comfort on the line. Pay a little more for peace of mind.” – David C., Licensed Plumber

Their years of water heater replacement expertise can help homeowners make the optimal choice.

Final Words

The costs of water heater replacement range widely based on the type of system, installation complexity, need for venting or electrical upgrades, and choice of contractor. Taking time to thoroughly weigh factors like energy efficiency, capacity requirements, warranty terms, and installer reputation against upfront pricing enables homeowners to make the most informed and cost-effective choice. Investing in the optimal water heater improves everyday comfort while keeping costs reasonable through calculated decision-making.

Answers to Common Questions

What to do after replacing a water heater?

Flush the tank to remove sediment, adjust temperature, inspect for leaks, review safety tips, and verify proper operation by running hot water in sinks and showers.

How to know when a water heater needs replacing?

Signs include rust, leaks, irregular temperature fluctuations, noisy operation, loose parts, and excess sediment. Most last 6-12 years before needing replacement.

Do you need to shut off the water when replacing water heater?

Yes, the main water supply should be shut off at the valve before beginning replacement. This prevents leaks and water damage during the install process.