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As opposed to traditional tank water heaters that store a reserve of warm water, tankless water heaters heat incoming water as it passes through the unit, potentially lowering your utility bills and reducing energy usage. Tankless water heaters can vary in price depending on their size and heating capacity, but you can typically expect to spend somewhere in the range of $200 to $500 for a smaller unit, and $500 to $800 for a more heavy-duty heater.
To help you find the best tankless water heater for your needs, we examined some of the best products on the market. Overall, our top choice is the Stiebel Eltron Electric Tankless Water Heater, which delivers a high flow rate and uses self-modulating technology to automatically adjust energy usage based on your needs. Read our guide below for more of our top picks.
Best 7 Tankless Water Heaters: Our Top 7 Picks
- Best Overall: Stiebel Eltron Electric Tankless Water Heater
- Best Whole-House: Rinnai Indoor Gas Tankless Hot Water Heater
- Best Propane-Powered: Rinnai Outdoor Gas Tankless Hot Water Heater
- Most Efficient: EcoSmart ECO 18 Electric Tankless Water Heater
- Best for Small Households: EcoSmart ECO 11 Electric Tankless Water Heater
- Best Value: Rheem Tankless Electric Water Heater
- Best for Outdoors: Noritz NR50ODNG Outdoor Tankless Water Heater
Compare Top-Rated Tankless Water Heaters
| Product | Flowrate | Heat Capacity | Warranty | Weight | Dimensions | ||
|---|---|---|---|---|---|---|---|
| Stiebel Eltron Tankless Water Heater | 5 GPM | 24 kW | 7-year (leak), 3-year (parts) | 20 pounds | 4.6 x 16.6 x 14.5 inches | ||
| Rinnai Indoor Tankless Hot Water Heater | 7.5 GPM | 120,000 BTU | Not listed | 46 pounds | 17.5 x 30 x 13 inches | ||
| Rinnai Outdoor Tankless Hot Water Heater | 5.3 GPM | 180,000 BTU | 10-year (heat exchanger) | 33 pounds | 10.5 x 30 x 13 inches | ||
| EcoSmart ECO 18 Electric Tankless Water Heater | 5 GPM | 18 kW | Lifetime (residential use) | 9 pounds | 14 x 3.5 x 17 inches | ||
| EcoSmart ECO 11 Electric Tankless Water Heater | 2 GPM | 13 kW | Lifetime (residential use) | 6.5 pounds | 3.8 x 8 x 11.5 inches | ||
| Rheem Tankless Electric Water Heater | 1.95 GPM | 8 kW | Not listed | 6 pounds | 12.6 x 8.3 x 3.6 inches | ||
| Noritz NR50ODNG Outdoor Tankless Water Heater | 5 GPM | 120,000 BTU | 12 years (heat exchanger) | 33 pounds | 11 x 27 x 17 inches | ||
| Product | Flowrate | Heat Capacity | Warranty | Weight | Dimensions |
Best Tankless Water Heater Overall
Stiebel Eltron Electric Tankless Water Heater
- $606.76
- $698
- 13% off
Prices taken at time of publishing.
What Are People Saying About the Stiebel Eltron Electric Tankless Water Heater?
We found that customers liked the longevity and reliability of this hot water heater. They said it worked in their home for over 10 years and dramatically reduced their energy bills. Unsatisfied customers that we saw said that the unit arrived defective and others said it didn’t work properly on well water.
“This is an absolutely amazing water heater. I replaced my propane-tanked water heater with this. My dad and I installed it ourselves in about three hours, including running new electric to the water heater closet … On to performance. I was skeptical at first, having been told by a few plumbers that on-demand technology wasn’t up to par … I decided to give this one a shot. I have to say that not only am I impressed, but was also shocked and highly satisfied with this machine’s performance. It produces hot water on demand, limited only by your water supply.” — Andrew Switzer via Amazon
“These water heaters can’t seem to handle well water or water that has high dissolved solids. Even my softened water with phosphate treatment will cause these to start having issues pretty quickly. I also descale mine regularly per the manufacturer-recommended method, and even that doesn’t help. After a year or two, the unit will start tripping the No.1 Safety thermal cut out.” — Mike L via Amazon
Best Whole-House Water Heater
Rinnai Indoor Tankless Hot Water Heater
- $734.88
Prices taken at time of publishing.
What Are People Saying About the Rinnai Indoor Tankless Hot Water Heater?
When researching reviews for this product, we found that many customers who were pleased with their purchase said that the unit was easy to install, had a quiet operation, and helped save them money on their utility bills. However, we also saw some disappointed customers who said the item arrived damaged and others noted that they did not have the proper vent to get this heater to run properly.
“We purchased this product three months ago. We have seen a reduction in our power bill, with very little increase in our gas bill. It is mounted outside, so no more humming of a hot water heater in the house trying to keep the water hot all day…. I love this product. We recommended it to my father-in-law, and we just ordered one for the new home he is building. We have a 2,800-square-foot home with three beds, two baths, a dishwasher and a washing machine, and it heats the water for everything amazingly.” — Corrine busby via Amazon
“This heater works well for the one second it heats the water before it errors out and shuts off. I had this installed by my pro plumber, only to find that I couldn’t use the existing exhaust vent from my previous heater that went vertically through my roof. This heater requires a special proprietary vent system that’s quite pricey—it’s going to cost me about $1000 to purchase the type and length of vent I need and then have my existing vertical vent replaced. Or, move the entire setup, including plumbing, to the opposite wall of the laundry closet to use the shorter and less expensive L-shaped vent, so that’s a big nope.” — KrysT. via Amazon
Best Propane-Powered Water Heater
Rinnai Outdoor Tankless Hot Water Heater
- $669.71
Prices taken at time of publishing.
What Are People Saying About the Rinnai Outdoor Tankless Hot Water Heater?
Satisfied customers that we observed liked this product’s efficiency, ease of operation, temperature control, and savings. The product had a few negative reviews, though with one person noting that they experienced issues with the flow switch and another saying they experienced an error code noting the unit was not getting enough propane.
“Upon purchasing a new home, we realized the water heater was undersized for our use, so we opted to try the tankless water heater. I must say we’ve been really impressed with this unit. It’s been in use for only a couple of weeks now. The ease of installation made this a quick changeover. … The installation kit (with the hook-up valves) made this a quick and simple install. I highly recommend it. Very doubtful anyone could/would be disappointed with its performance.” — Mike via Amazon
“I have the unit maxed out for temperature settings, but more often than not, you can have full-blast hot water and not get burned. It continued issue over the last year is a code 12, which means it’s not getting enough propane. I have two other appliances on the same line, and neither one of them has had any issues.” — Kevin Rooney via Amazon
Most Efficient Water Heater
EcoSmart ECO 18 Electric Tankless Water Heater
- $320.91
- $370
- 13% off
Prices taken at time of publishing.
What Are People Saying About the EcoSmart ECO 18 Electric Tankless Water Heater?
We noticed several customers who were pleased with their purchase said that the water heater was easy to install, reliable, and reasonably priced. Unsatisfied customers were disappointed with the manufacturer’s customer service, noting issues with utilizing the warranty.
“Exactly what I needed for a bathroom, small kitchen and washer. Mounts inside, no gas line, no exhaust or vent needed, and surprisingly no noise and plenty of hot water.” — Alberto Mota via Amazon
“…Great water heater and very efficient. Comes with a lifetime warranty, so when it stopped heating water, I had the electrician who installed it inspect it. He found nothing wrong with the wiring or power… At this point, I already spent $335 on troubleshooting and had gone two weeks without hot water. I was told that I had to keep troubleshooting until they determined the unit itself was defective, and then, and only then, they would ship me a new unit. So the warranty is only good if you spend a ton of money to prove it is the unit that is defective and if you can go without hot water for weeks. Such poor customer service for a great product.” — Jane S. via Amazon
Best Water Heater for Small Households
EcoSmart ECO 11 Electric Tankless Water Heater
- $237.02
- $299
- 21% off
Prices taken at time of publishing.
What Are People Saying About the EcoSmart ECO 11 Electric Tankless Water Heater?
We found that customers liked this water heater’s easy setup, consistent performance, and energy savings. Those we found that weren’t pleased with their purchase mentioned issues with the warranty not being honored and tech support not being helpful. Others said it didn’t hold up well during wintertime.
“I have this unit in a bathroom with a shower, jacuzzi tub, and two hand washing facets. It covers them all. It gets hot in about 8-10 seconds and much hotter (too hot) in about 20, and I don’t have it turned all the way up. I’ve been using it for about a month. I also installed a larger unit for the kids’ rooms and it is also working flawlessly. Good product for the price and an easy install. I highly suggest using flexible water lines!” — Amazon Customer via Amazon
“We’re at the four-year mark with it, and it’s gotten to where it barely heats. I mean, like at all. It never was fantastic, we have a very small house with one bathroom, and even at that, it struggles through the winter to deliver a shower. I’m going to have to replace it, unfortunately.” — Ogre8 via Amazon
Best Value Tankless Water Heater
Rheem Tankless Electric Water Heater
- $234.54
Prices taken at time of publishing.
What Are People Saying About the Rheem Tankless Electric Water Heater?
Overall, most customers we reviewed said this tankless water heater was effective. They added that it quickly heated their water when needed and saved electricity by turning it off when hot water wasn’t needed. Others were impressed by its self-modulating feature. However, we did see some users complain about using the tankless water heater in a portable scenario, stating that the power cord necessary for the water heater was overly large.
“Installed this unit under the kitchen sink and it supplies both the main sink and the island sink. The great thing about this heater is that it is self-modulating. Basically, it senses the temp of the incoming water and adjusts the heating elements to give a consistent output temp. I highly recommend it, especially if you live in warm climates. I live near Phoenix where our cold water temp is cool in the winter and barely cool in the summer.” — FED_Arizona via Amazon
“Once installed, the heater works pretty well. Be sure you understand the ratings and capabilities though. An 8-kilowatt heater isn’t big enough to handle a shower and barely handles a kitchen sink. …You also need to slow the flow. If you’re putting this heater on something bigger than a bathroom sink, you will want to install flow control of some kind and limit the flow to 1GPM or less.” — Tek via Amazon
Best for Outdoors
Noritz NR50ODNG Outdoor Tankless Water Heater
- $694.07
Prices taken at time of publishing.
Good for: Homeowners seeking a tankless water heater they can use for an outdoor application.
What Are People Saying About the Noritz NR50ODNG Outdoor Tankless Water Heater?
We found that those who gave this product a positive review liked that it was easy to install and worked efficiently. Others liked how low the price was and noted that it had an excellent value. However, there were also some negative reviews that focused on poor packaging, and another customer said they experienced error codes after a year of use.
“Great price, easy installation, and works fantastic. We aren’t at the house all the time and don’t have to heat any water until we are there and need it. The savings are already noticeable.” — Amazon Customer via Amazon
“Worked fine for one year. Then, when cold weather comes, I get an error message every few days, and it does not turn on. I have to go outside and unplug it and reset it manually…. Gas company came out last year and gas pressure tested good at all levels. Error code says combustor section fault.” — Bill Grissom via Amazon
What To Know Before Buying a Tankless Water Heater
Before you pick a tankless water heater, there are several important factors you should consider to help you narrow down your options. First, you’ll need to understand the differences between gas and electric heaters. You should also consider if your home is more conducive to a condensing or a non-condensing model, and if you plan to install it indoors or outdoors.
From there, examine the heater’s flow rate (measured in gallons per minute, or GPM) and its heat capacity. You can also look at factors such as the ease of installation and the warranty of the unit. Read our buying guide below for more information on purchasing a tankless water heater.
How are tankless water heaters powered?
Tankless water heaters use electricity or gas for power. We measure the heating capacity of gas-powered water heaters in British thermal units (BTUs) and the heating capacity of electric water heaters in kilowatts (kW).
- Electric: Electric models connect to your home’s electrical system. As water passes through the unit, a sensor in the heating element turns on the burner, and a thermostat starts working to get the water heated to your desired temperature. We found the cost of an electric water heater to be more affordable than a gas-powered one, but the unit is less efficient at heating the water that passes through it.
- Gas: Gas-powered water heaters are more efficient, allowing them to heat enough water to run several appliances at once. They can be split into non-condensing and condensing subcategories based on whether they have one or two heat exchangers.
What’s the difference between condensing and non-condensing units?
- Non-condensing: A non-condensing unit has one heat exchanger. The exhaust it produces is around 300 degrees Fahrenheit, meaning the unit wastes a lot of heat that could be used to warm more water. However, this type of gas heater is more affordable in our experience than its condensing counterpart. The unit and installation also cost less because you can use the same ventilation from your previous gas-powered tank-style water heater.
- Condensing: Condensing tankless water heaters have a second heating system that recirculates the hot exhaust produced by the first heating system to heat more water. While the initial cost of this water heater is more than a non-condensing unit, we find you end up saving money in the long run because of its lower energy costs.
How is the water flow rate tracked in tankless water heaters?
Tankless water heaters are rated by how many gallons of hot water they can produce per minute, measured in GPM. Electric water heaters have a lower flow rate than non-condensing gas heaters, which have a lower flow rate than condensing gas heaters.
When considering the flow rate you need, think about how many appliances you want to run at once and how much hot water those appliances require. For example, our team found that kitchen faucets require about 0.5 GPM, shower heads require 2.5 GPM, dishwashers require one GPM, and washing machines require 1.5 GPM. If you want to run your dishwasher while showering, your unit will need a flow rate of at least 3.5 GPM to keep up with your demand.
What’s the difference between indoor and outdoor water heaters?
Outdoor water heaters work well if you don’t have the space for one in your home or if you can’t install the ventilation needed for a gas-powered one. However, we don’t find them to be as efficient in the winter months because they’re directly exposed to cold temperatures, forcing them to work harder to heat the water running through them.
What’s the installation process like for tankless water heaters?
Electric water heaters are easier to install than gas ones. Because of their small size, they can be placed in more areas than gas-powered water heaters. Once you’ve chosen a spot, connect the water heater to your electrical system and water pipes. If you install a gas-powered water heater inside, know that it will require ventilation to ensure the by-products produced by the burning gas don’t remain in your home and poison your family. Not only does this increase the cost to install a tankless water heater and time, but it also limits where you can put the unit because you have to have space for the unit, vents, and ducts.
For more information on how to install a tankless water heater, check out the video below.
What is the typical maintenance needs and warranties on tankless water heaters?
Depending on the model and type of tankless water heater you choose, we recommend that it be maintained by a professional once or twice a year. Due to the mineral content (“hard” water) in many local water supplies, a professional may need to descale or de-lime your tankless water heater. Additionally, you may need a professional technician to install your new tankless water heater to validate the manufacturer’s warranty.
Tips for Using a Tankless Water Heater
Once you’ve chosen the best tankless water heater for your needs, the next step is to learn how to use it properly to get the best results. When operating a tankless water heater, keep these tips in mind to ensure you’re getting the most bang for your buck.
Read the Manual
Familiarize yourself with the manufacturer’s instructions and safety guidelines provided in the user manual. Each tankless water heater model may have specific requirements and recommendations.
Be Mindful of Ventilation
Gas-powered tankless water heaters need to be properly ventilated to work effectively. Tankless water heaters generate exhaust gases, so it’s important to vent them to the outside of your home to prevent the buildup of harmful gases like carbon monoxide.
Be Careful with the Temperature
Take care when adjusting the temperature settings of your tankless water heater. Higher temperatures can scald or burn, especially for children or the elderly. Set the water temperature to a safe and comfortable level.
Monitor the Water Pressure
Tankless water heaters require adequate water pressure to function properly. Excessively high water pressure can damage the unit, while low water pressure may result in insufficient hot water. Consider installing a pressure regulator if necessary.
Keep the Area Clear
Avoid storing flammable materials, chemicals, or combustible items near the tankless water heater. Maintain a clear area around the unit for proper airflow and easy access.
Frequently Asked Questions About Tankless Water Heaters
Will I save money with a tankless water heater?
Yes, over time you can save money with a tankless water heater due to its increased energy efficiency. Look for an Energy Star certified product to make sure it’s efficient. While the cost of a tankless unit is more expensive than the cost of a tank-style unit, you’ll save money in the long run because it’s more efficient at heating water.
How long will it take my tankless water heater to heat my water?
Most tankless water heaters heat your water within seconds, in our team’s testing experience. The short lag you may experience is likely due to how far away the heater is from the tap.
Will my tankless water heater still work if the power goes out?
Since gas water heaters aren’t connected to your electrical system, they’ll still work if you experience a power outage. Electric heaters will still allow water to flow through them, but their heating element won’t work unless you have a battery backup.
What are the drawbacks of a tankless water heater?
The drawbacks of tankless water heaters we found typically include a longer wait time for hot water, high upfront installation costs, and difficulty achieving a lukewarm temperature. Additionally, electric tankless water heaters may not work during a power outage.
How We Selected the Best Tankless Water Heaters
To provide our readers with the best tankless water heater recommendations possible, we rely on several key sources of information to help guide our selection process.
Initial Research: Our research process began by generating a list of tankless water heaters with a significant number of verified-buyer reviews and an average customer review rating of 4–5 stars. We looked at positive and negative reviews alike, focusing on information from both satisfied and critical buyers.
Expert Insights: Through our years of experience, we’ve learned that listening to what others have to say is key to building accurate, well-rounded articles. To complement our in-house expertise, our team looked at reviews and videos from trusted publications and independent testers, spoke with subject matter experts, and drew insights from reader contributions.
Final Product Selection: We then began fine-tuning our list by replacing older models with the latest versions and eliminating any discontinued models. From there, we pared the list down further by comparing each model’s feature set and selecting the best-in-class options for a variety of buyers, budgets, and scenarios.
Questions or Comments?
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