How to Install a Tankless Water Heater

Key Takeaways

• Tankless units save energy and money — up to 34% efficiency boost.

• Sizing, venting, and water quality are critical for success.

• DIY installation is possible, but not without risks.

• Always check local code, permits, and safety requirements.

Save energy. Slash utility bills. Enjoy endless hot water. If those benefits sound appealing, you’re not alone. Tankless water heaters have surged in popularity — and for good reason. According to the U.S. Department of Energy, tankless water heaters can be 24–34% more energy-efficient for homes using 41 gallons or less of hot water daily.

But here’s the catch: installation matters. Even the best tankless unit can underperform — or fail — if installed incorrectly. Whether you're a DIY enthusiast or a savvy homeowner exploring your options, this article is your go-to blueprint. Let's dive in.

Why Go Tankless? The Big Benefits You Can't Ignore

Before jumping into the how-to, it’s worth highlighting why more than 1.5 million American homes switch to tankless water heaters each year.

Endless Hot Water

Say goodbye to cold showers. Tankless systems heat water on demand — instantly.

Lower Energy Bills

Because they only heat water when needed, tankless units can reduce energy costs by up to 30% annually.

Compact Design

Most units are wall-mounted, freeing up valuable space in your basement or utility closet.

Longer Lifespan

While traditional tanks last 8–12 years, a well-maintained tankless system can run for 20 years or more.

Eco-Friendly

Using less energy means reducing your carbon footprint — good for your wallet and the planet.

What You’ll Need: Tools & Materials Checklist

Getting the job done right starts with the right gear. Here’s your essential tankless water heater installation toolkit:

Tools

• Pipe wrenches (2)

• Screwdriver set

• Adjustable wrench

• Tubing cutter

• Drill and bits

• Leak detector spray

• Stud finder

• Voltage tester

• Level

Materials

• Tankless water heater unit

• Mounting hardware

• Shut-off valves

• Gas flex line (for gas models)

• PVC or stainless steel venting kit

• Copper or PEX pipe

• Water filter or softener (recommended)

• Expansion tank (if local code requires)

• Teflon tape and pipe dope

Pro Tip: Before buying, check local building codes. Permits may be required for installation.

3. Pre-Installation Must-Knows

Choose the Right Size

Don’t guesstimate. Use this formula to estimate size:

GPM (gallons per minute) demand x Temp Rise = BTU or kW required

• Shower: 2.0–2.5 GPM

• Dishwasher: 1.0–2.0 GPM

• Washing machine: 1.5–3.0 GPM

Example: A 3-shower home using all at once needs a unit with 6–8 GPM output.

Gas or Electric?

• Gas models: More powerful, ideal for large households.

• Electric models: Easier to install, lower upfront costs.

Statistic: According to Energy.gov, electric units may be less expensive but cost more over time if electricity rates are high.

Location Matters

Mount your unit:

• Near major water usage points

• Away from extreme cold

• In a ventilated, accessible space

  
  

4. Step-by-Step Installation Guide (Gas & Electric)

Let’s get into the nitty-gritty.

Step 1: Turn Off Utilities

• Shut off gas or electricity to the old unit.

• Turn off water supply.

• Drain the system fully to avoid leaks or burns.

Step 2: Remove Old Heater (If Applicable)

• Disconnect the water lines.

• Remove any mounting brackets.

• Have a helper assist for safe lifting.

Step 3: Prep the Wall

• Use a stud finder to locate wall studs.

• Mount the bracket level — a tilted unit can cause internal damage.

• Hang the tankless unit securely.

Step 4: Connect Water Lines

• Install shut-off valves on both cold water inlet and hot water outlet.

• Use PEX or copper piping for reliable connections.

• Wrap threads with Teflon tape to prevent leaks.

Tip: Install a sediment filter if your area has hard water — it protects internal components.

Step 5: Hook Up Power or Gas

For Gas Units:

• Connect the gas flex line to the inlet valve.

• Use pipe dope or gas-rated Teflon tape.

• Tighten all fittings and test with a leak detector spray.

For Electric Units:

• Run a dedicated 240V circuit with the correct breaker size.

• Use a voltage tester to ensure power is off before wiring.

• Connect ground wire and line-in according to the manual.

Always follow NEC codes and consult a licensed electrician for electric work.

Step 6: Install Venting (Gas Models Only)

• Choose a venting material: PVC, stainless steel, or concentric venting.

• Ensure proper slope to avoid condensation buildup.

• Seal all connections with approved venting tape or silicone.

Step 7: Final Water Connections & Purge

• Turn on cold water supply and flush air from the system.

• Open hot water tap to remove air pockets.

• Inspect for leaks at every joint.

Step 8: Power On & Test

• Flip the breaker or gas valve.

• Set desired water temperature (typically 120°F).

• Run multiple taps to verify stable operation.

Don’t skip: Register your warranty and note the installation date.

Common Mistakes to Avoid

Even seasoned DIYers can mess up here. Don’t be that person.

Skipping the Water Filter

Hard water is a tankless killer. Protect your investment.

Ignoring Ventilation Requirements

Improper venting = risk of carbon monoxide poisoning. Enough said.

Undersizing the Unit

This leads to cold showers and costly replacements.

Poor Slope on Vent Pipe

Can cause water pooling, corrosion, and eventual system failure.

6. Safety Tips & Best Practices

Safety first, always.

• Pull permits if your area requires it.

• Install a carbon monoxide detector near gas units.

• Use dielectric unions between copper and steel to prevent corrosion.

• Don’t install outdoors unless rated for it.

• Consult the manufacturer’s manual for model-specific requirements.

Pro Insight: Hiring a licensed plumber or HVAC technician can avoid voiding your warranty.

Final Thoughts: Is DIY Worth It?

Installing a tankless water heater can save you $1,000–$2,000 in labor costs. But the stakes are high.

If you:

• Have solid plumbing or electrical experience

• Are comfortable with local codes

• Have access to the right tools

…then DIY might make sense.

However, if gas lines, venting, or electrical panels sound intimidating, hiring a professional is the smarter (and safer) move.

Ready to Make the Switch?

Switching to a tankless water heater is one of the most impactful upgrades you can make to your home. With lower energy costs, greater reliability, and luxurious comfort, it’s more than an appliance — it’s an investment in your home’s efficiency and value.

If you’re ready to install it yourself, bookmark this guide, grab your tools, and take action today.

Additional Frequently Asked Questions (FAQs)

1. Can I install a tankless water heater in a mobile home or RV?

Yes, but you’ll need a unit specifically rated for mobile use. Venting, space, and power/gas limitations are critical considerations. Check manufacturer compatibility and local mobile home codes.

2. What type of maintenance is required after installation?

Tankless water heaters require annual descaling or flushing, especially in hard water areas. Most manufacturers recommend using a vinegar solution and pump to clean out mineral buildup.

3. Does a tankless water heater require a water softener?

Not required, but highly recommended if your water hardness exceeds 7 grains per gallon. Hard water drastically reduces lifespan and efficiency without treatment.

4. Can I install a tankless water heater in a closet or tight space?

Yes, but only if the unit is designed for confined spaces and has proper ventilation. Gas models, in particular, need fresh air intake and exhaust clearance.

5. Is a recirculation pump necessary with tankless systems?

Not required, but a recirculation pump drastically reduces wait time for hot water at distant faucets — enhancing convenience and saving water.

6. What size gas line do I need for a tankless water heater?

Most gas models require a ¾-inch gas line. Undersized lines are a common mistake and can lead to poor performance or ignition failure.

7. Can I vent a tankless water heater through an existing chimney?

Not typically. Tankless units require direct venting using manufacturer-approved materials. Chimneys rarely meet clearance and slope requirements.

8. Will switching to a tankless system affect my home’s resale value?

Yes — in a positive way. A tankless system is often viewed as a premium home upgrade, which may improve appeal and value to eco-conscious or tech-savvy buyers.

9. How do I winterize an outdoor tankless water heater?

Outdoor units need to be drained and possibly insulated with freeze protection kits. Some models have built-in freeze protection down to -22°F with power connected.

10. Can I install multiple tankless water heaters in my home?

Absolutely. In larger homes or those with high water demand, dual or cascading units provide uninterrupted hot water across multiple bathrooms or zones.

11. How long does it take to install a tankless water heater?

4–8 hours for experienced DIYers. Pros can do it in 2–4 hours.

12. Do I need a permit to install one?

Usually yes. Check with your local building department.

13. Can I install a tankless unit where my tank heater was?

Yes, but gas and venting upgrades are often needed.

14. How much does a professional installation cost?

Between $1,500 and $3,500 including labor and materials.