Tankless vs. Tank Water Heaters: What You Need to Know
Reading Time: 5minutes
When it’s time to replace your water heater, one of the biggest decisions you’ll face is choosing between a tankless vs. tank water heater. Both types provide hot water, but they operate differently and come with unique benefits and drawbacks.
A tank water heater stores and preheats a set amount of water (usually 40–50 gallons), ensuring it’s always available but with a limited supply. A tankless water heater, on the other hand, heats water only when needed, offering an endless supply but at a higher upfront cost.
So, which one is right for your home? In this guide, we’ll break down the differences, pros and cons, installation requirements, maintenance needs, and key factors to help you make the best choice.
How Do Tankless vs. Tank Water Heaters Work?
Tank Water Heater:
A tank water heater continuously heats and stores a specific amount of water in a tank. The water is always hot and ready to use, but once the tank runs out, you’ll have to wait for it to refill and reheat. These systems operate using gas or electricity and require sufficient space in a utility room, basement, or garage.
Tankless Water Heater:
A tankless water heater heats water on demand. Instead of storing hot water, it rapidly heats water as it flows through the unit, ensuring a constant supply without running out. Since there’s no standby heating, these systems are more energy-efficient than their tank counterparts.
Since a tankless water heater heats water as you use it, it’s important to have the right size and model tankless installed. To be sure you have a tankless that will keep up with your demands, be sure to have a certified plumber who has knowledge and experience specifically with tankless water heaters. We often come behind handymen or even plumbers without tankless training to resolve tankless issues.
🔗 Want to learn more about how a tankless system works? Check out our detailed guide here.
Hot Water Considerations
When comparing tankless vs. tank water heaters, it’s important to compare 3 primary factors: cost, hot water supply, and lifespan. Consider the investment you’d like to make at installation versus the energy savings earned over time. Also take a moment to think about the hot water needs of your family: Do you need to time your showers so that everyone has hot water? Enjoy filling up a garden tub? Finally, think about how long you plan to benefit from your new water heater.
Pros and Cons of Tank Water Heaters
✅ Pros:
Lower upfront cost – more affordable than tankless models.
Simpler installation – works with existing plumbing and power sources.
Works well for homes where hot water usage isn’t constant.
A tank water heater is a budget-friendly choice with a straightforward installation process, so long as the home already has a tank water heater. Replacing what is already in a home can be ideal for homeowners looking for a simple solution. If your household doesn’t use a large amount of hot water at once, a tank water heater may be a good fit.
❌ Cons:
Limited hot water supply – once the tank is empty, you must wait for it to refill.
Higher energy costs – constant heating leads to standby heat loss.
Age Concerns – Reduced performance and flood risk with age
Takes up more space – requires a dedicated area in your home.
Tank water heaters have some significant downsides. Since they store a set amount of water, you might run out of hot water during back-to-back showers or high-usage periods. Additionally, because the unit continuously reheats water even when it’s not in use, your energy bills could be higher. As tank water heaters age, sediment can build up at the bottom. This sediment makes it harder for the heat source (the heating element or burner) to reach and heat the water inside of the tank. You may find, with time, that you run out of hot water faster and it doesn’t get as hot. Additionally, as a water heater ages, the possibility of it leaking increases significantly. A burst or even just leaking tank water heater can flood a home fast.
Pros and Cons of Tankless Water Heaters
✅ Pros:
Endless hot water supply – perfect for large families.
More energy-efficient – only heats water when needed.
Compact design – frees up valuable space.
Longer lifespan – can last 20+ years vs. 10–15 years for a tank heater.
If you never want to run out of hot water again, a tankless water heater is an excellent option. It heats water on demand, ensuring you always have enough for back-to-back showers, dishwashing, and laundry—making it an ideal solution for large families. This type of system is also more energy-efficient and lasts longer than a tank water heater, making it a great long-term investment.
❌ Cons:
Higher initial cost – installation is more expensive than traditional models.
May require plumbing or gas line upgrades – especially in older homes.
Flow rate limitations – may need multiple units for large homes with simultaneous usage.
Despite these benefits, tankless water heaters do have some downsides. The upfront cost is higher, and some homes may require additional plumbing modifications to accommodate the system. Additionally, while they provide endless hot water, their flow rate can be a concern—if multiple showers and appliances run simultaneously, a single tankless water heater may struggle to keep up.
Key Factors to Consider When Choosing
Hot Water Demand: Large families benefit from a tankless water heater because it provides endless hot water. A tank water heater may run out of hot water during back-to-back showers or high-usage periods.
Budget: A tank water heater is more affordable upfront, while a tankless water heater saves money long-term on energy bills.
Available Space:Tankless water heaters are wall-mounted and ideal for small homes. Tank water heaters require more space.
Energy Efficiency: A tankless water heater eliminates standby heat loss, reducing utility costs.
Lifespan & Maintenance: A tank water heater lasts 10–15 years, while a tankless water heater can last 20+ years.
🔗 Curious about how long a water heater typically lasts? Read more here.
Installation and Maintenance Considerations
Tank Water Heaters:
Installation is generally simpler and faster, especially if replacing an existing unit.
Requires annual flushing to remove sediment buildup.
If the anode rod isn’t maintained, the tank can corrode and leak.
Tankless Water Heaters:
Installation is more complex and may require gas line or electrical upgrades.
Requires descaling to prevent mineral buildup, especially in areas with hard water.
More durable, lasting over 20 years with proper maintenance.
Whether You Go Tankless or Tank, Make Sure It’s Professional Grade
The water heaters available to consumers, rather than licensed plumbing companies, are not professional grade. Yes, you can buy a tankless water heater on Amazon. Yes, you can buy a tank water heater from the big box stores. But you shouldn’t. At minimum, you should know that you are purchasing a much lower quality product.
First, be sure you’re purchasing a reputable brand, as finding the parts or a technician able to service an off brand tankless from Amazon will be extremely difficult. Second, even the brand name water heaters, like AO Smith, are not the professional grade water heaters that plumbers purchase at a supply house.
Water heaters involve gas and venting of dangerous gasses or electricity. We have seen hundreds of dangerous examples where an unqualified person installed a water heater to save money. To get a high quality product that will last and be safe, have a reputable plumber install a professional grade tank or tankless water heater. We recommend Navien or Rinnai tankless water heaters or AO Smith Professional Grade water heaters.
Need Help Choosing Between a Tank or Tankless? We’ve Got You Covered!
At Aaron Services: Plumbing, Heating, Cooling, we specialize in tankless and tank water heater installations. We’re happy to help you find the perfect option for your home. Whether you’re looking for an energy-efficient upgrade or need a reliable system that meets your family’s hot water needs, our experts are here to help.
