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A quality tankless water heater is space-saving and energy-efficient, heating only as much water as you need at any given time.
We researched dozens of tankless water heaters, evaluating efficiency, temperature control, ease of installation, and value. Our favorite natural gas model, the Rinnai RL Series HE+ Tankless Hot Water Heater, is compact and offers excellent water pressure. Our top electric model is the Rheem Performance Tankless Electric Water Heater, which is easy to use and provides a reliable source of on-demand hot water.
Here are the best tankless water heaters.
Best Overall, Natural Gas: Rinnai RL Series HE+ Tankless Hot Water Heater
Faster flow rate
Safe to use in mobile homes
Additional purchases necessary for energy-efficiency
What do buyers say? 87% of 800+ Amazon reviewers rated this product 4 stars or above.
Out top pick for a natural gas tankless water heater is the Rinnai RL75iN Luxury 7.5 GPM Liquid Natural Gas Tankless Water Heater because it offers a great combination of value and efficiency. Natural gas tankless water heaters generally offer faster flow rates than electric and are a good option if you already had a gas water heater previously installed. Rinnai, a Japanese gas appliance manufacturer, is known for producing reliable and powerful tankless water heaters that won’t leave much to be desired when compared to your conventional tank water heater. The Rinnai RL75i offers up 7.5 GPM of hot water and can support up to four different fixtures at once, depending on the incoming groundwater temperature. This model is also equipped to take advantage of Rianni’s Circ-Logic recirculation technology, which optimizes the energy usage of the tank’s recirculation pump—though you need to purchase Rianni's pump kit and control-R module to take advantage of this feature.
Even if you live in a cold weather climate, this gas-fired tankless water heater can supply hot water to at least three fixtures if the water temperature is at least 57 degrees. This unit also includes enhances scale detection to lessen the likelihood of long-term damage, plus leak detection technology shuts off the water flow on this heater to prevent major water damage within your home. Without a tank, you can also worry less about competing for space in your garage or utility closet and enjoy this unit's compact size. The heat exchanger also has a 12-year warranty on it, so you can feel confident about being protected for the product's performance overtime. All in all, this natural gas tankless water heater is a great option for any homeowner looking to save space in their home and save money on water and energy costs.
Best Overall, Electric: Rheem Performance 7.03 GPM Tankless Electric Water Heater
Easy to install
Self-modulating heating technology
Some gas units offer higher GPM
May not be best for consumers in Southernmost points of the U.S.
This 7 GPM electric water heater model from Rheem our top electric pick for its performance and easy operation. It’s usually most simple (and cost-effective) to choose an electric tankless water heater, when it comes time to replace your conventional electric water heater, and this option from Rheem is a reliable choice that will last for years in your home. A digital temperature display makes it easy to see what temperature incoming water will be heated to, and you can adjust it by a single degree from 80 to 140 degrees using the knob. While small in size, measuring just 18 inches tall by 21 inches long, most people don’t miss their large, bulky tank water heater after upgrading to this unit.
This electric water heater keeps up with hot water needs for the majority of households; it can supply hot water for up to three showers simultaneously (depending on the groundwater temperature and your shower's flow rate). This heater also packs a punch in heating power with over 120,000 BTUs per hour. Rheem also offers a 5-year limited warranty on the heat exchanger and a 1-year limited warranty on parts, so you don't have to worry is there's any mechanical issues with the unit. While this electric unit does have a high GPM, it may not be best for your home if you're located in Southern regions of the United States, where the water inlet temperature is warmer. Overall, we think this unit is a great choice for anyone who's hoping to reduce their energy usage by 34% as a whole home solution.
Best Budget: EcoSmart ECO 18 Tankless Electric Water Heater
Digital temperature display
Not best as a whole-home heater in all regions
While tankless water heaters represent a larger upfront investment than the cost of a conventional water heater, the EcoSmart ECO 18 is a more affordable tankless model that closes the gap in price between tank and tankless water heaters. The ECO 18 heats more than 2.5 gallons per minute and can support up to two showers simultaneously in warm weather climates. It features digital controls to make it easy to set the target temperature for the water.
This budget tankless water heater offers electric operation and is easy to install in the place of an electric tank water heater. However, it’s small size and affordable price tag mean that it’s also somewhat more limited in capacity—it’s really only powerful enough to serve as a whole home tankless water heater in areas where the incoming water temperature is 62 degrees Fahrenheit or greater.
Runner Up, Best Budget: Bosch Tronic 3000
Fits under a sink
6-year limited warranty on heat exchanger
Not a whole-home heating source
A point-of-use tankless water heater is compact enough to fit under sinks and is commonly used to boost hot water availability in bathrooms or kitchens. It can be used to boost supply from a larger whole house tankless water heater or a conventional water heater that lies far from the sink’s location. This model from Bosch measures just 13.75 x 13.75 inches; it can easily be mounted on a wall, shelf, or cabinet floor.
While it’s only designed to support one sink, it delivers hot water on the spot and doesn’t waste energy heating and storing water for future use. In addition, it has an excellent 98 percent energy efficiency rating.
Best Splurge: Takagi T-H3-DV-N Condensing Natural Gas Tankless Water Heater
High flow rate
No pilot light
Harder to find technicians who can service Tagaki products
You’ll spend more for a condensing tankless water heater, but these models work extra hard to capture energy and improve efficiency. The Tagaki T-H3-DV-N model is capable of producing up to 10 GPM of hot water, and can supply up to four fixtures in warm weather and three fixtures if the source water temperatures are cooler. At the same time, this Energy Star-certified natural gas tankless water heater saves energy by capturing heat from the exhaust produced using a secondary heat exchanger.
This 199,000 BTU tankless water heater from Tagaki, a Japanese water heater company, is known for producing a reliable flow of hot water for showers, appliances, and other household needs without skipping a beat. One thing to note is that it can be trickier to find a service technician who is experienced in troubleshooting or repairing this brand of water heater.
While gas tankless water heaters have a higher initial cost than electric models, condensing versions like this one cost a premium price. However, they represent some of the most energy-efficient tankless water heaters on the market.
Best for Small Homes: Ecosmart ECO 11 Electric Tankless Water Heater
Automatic thermostat settings
Can save up to 60% on heating costs
Not best for areas with cooler water temperatures
Small homes, with their lower hot water demands, often benefit from a tankless water heater. The EcoSmart ECO 11 is a great option if you really only need to run one or two water fixtures at a time, like a sink and a shower.
This model can heat up to 2 gallons of water per minute. If you live in a warm weather climate, this tankless water heater can meet the needs of most small homes by supplying hot, steamy water to a bathroom sink and a shower simultaneously. However, if you live in an area where the incoming water temperature sinks below 72 degrees, you’ll have to be choosier when turning on the hot water tap—this tankless water heater can only run a single shower or two sinks in colder weather.
Best Outdoor: Rinnai V53DeN Outdoor Tankless Water Heater
Great for small- to medium-sized homes
Most water heaters are tucked into utility closets or installed in basements, which makes sense since these appliances are more effective and efficient if they don’t have to also battle the drain of cold weather. This is especially true for tankless water heaters which have to do their work on the spot and deliver warm water right away to your shower, sink, or other appliance. However, the Rinnai Value Outdoor Natural Gas Tankless Water Heater is a 5.6 GPM model that is designed for outdoor installation and saves space inside your home.
This model from well-known water heater manufacturer Rinnai is built to withstand installation in spaces that lack climate control, like attached garages, attics, or crawlspaces. It can support up to two showers simultaneously.
Best Portable: CAMPLUX ENJOY OUTDOOR LIFE Outdoor Portable Propane Tankless Water Heater
Compatible with mobile homes
Great for off-grid or low electricity areas
Low flow rate
If you want hot water on the go, consider a portable tankless water heater. This model from Camplux connects to a propane tank and offers up to 1.32 GPM of hot water for showers, cooking, and handwashing. With a battery-powered ignition and easy operation, it’s great for camping or other off-grid scenarios. The Camplux Portable Tankless Water Heater includes a gas regulator and showerhead for easy set-up. To effectively use this portable tankless water heater, just be sure that you have minimum water pressure of 3.0 PSI.
What to Look for in a Tankless Water Heater
There are two types of tankless water heaters, separated based on how they vent the steam produced during the heating process.
- Non-condensing tankless water heaters have a low efficiency rating, between 80 to 85 percent, because they release the steam or water vapor immediately, resulting in heat loss. These systems have a more affordable initial cost, though the ventilation materials may cost more because they need to be able to handle the high temperature of the steam.
- Condensing tankless water heaters have a higher upfront cost, but overall they are the more cost-effective option. This is because condensing water heaters use a condensing unit to capture the steam and reuse the residual exhaust heat before venting the exhaust outside. This improves efficiency to about 98 percent and saves on costly ventilation materials.
Another factor that differentiates tankless water heater models is the type of fuel used to heat the water.
- Natural gas is a convenient option that can run directly into the home and typically costs less than propane or electricity. While natural gas isn't suitable for RV or campsite tankless water heaters, it is the best option for high-demand households. Just keep in mind that if your home doesn't already have a natural gas line, then there would be an additional cost to have one installed. It should also be noted that a natural gas tankless water heater will typically have a higher cost than an electric tankless water heater.
- Propane gas is another option that can be used to fuel a tankless water heater, though this fuel is best for portable units that are used in RVs and at campsites. Propane is too costly for regular use in a residential home, but it's perfect for travel.
- Electricity is more expensive than natural gas, but less expensive than propane. Additionally, an electric tankless water heater is usually more affordable than a natural gas tankless water heater and these models have an efficiency rating about 10 percent higher than a standard gas model.
Take a look at the flow rate in gallons per minute (GPM) before purchasing a tankless water heater. This measurement should be listed by the manufacturer and it's used to determine the maximum flow of hot water the heater can produce. Each fixture in the home will use a portion of the collective flow rate produced by the water heater. For instance, a sink uses about 1.5 GPM on average and a shower uses about 3 GPM. If you want to run both the sink and shower at full capacity, then the tankless water heater will need a flow rate of at least 4.5 GPM.
To heat the water to a desired temperature, a tankless water heater needs to generate energy. The amount of energy required to reach this temperature is referred to as power input and it's measured in British thermal units (BTUs). A single BTU is the amount of energy required to raise the temperature of one pound of water by one degree Fahrenheit.
The power input is often provided by the manufacturer, but if you don't know the amount of energy you need, then this number is inconsequential. First, find out the average temperature of the water as it enters your home. This can be achieved by running the cold water for several minutes, then measuring the temperature of the water.
You will then need to decide on how hot you want the water to be. For instance, if the water coming into the home is 50 degrees Fahrenheit and you want the shower to produce water at 120 degrees Fahrenheit, then you need to increase the heat by 70 degrees. Multiply the Temperature Change of 70 by the weight of a gallon of water (8.33 pounds) to figure out that this would require 583 BTUs if the flow rate is zero. However, given that you need the water to flow to the shower, you can assume a flow rate of about 3 GPM.
To find the required power input, use the equation: GPM x Temperature Change x 500.
500 is the weight of a gallon of water (8.33 pounds) multiplied by 60 minutes. The result of this example is 105,000 BTUs per hour, though this assumes an efficiency rating of 100 percent. Use this simple equation to determine the right power input for your tankless water heater.
How do you install an electric tankless water heater?
DIYers should not install an electric or a gas tankless water heater. Save this job for the professionals. Regardless of whether you are installing an electric or gas tankless water heater, there are home systems that require a licensed and certified professional to upgrade or alter. Electric tankless water heaters will need to be connected to an electrical system with the appropriate rating, and a gas tankless water heater will need both a gas line and proper ventilation for the exhaust system. The installation will also need to meet local building codes. Due to these regulations, it's recommended to hire a professional, both for safety and convenience.
How do you know what size electric water heater you need?
In order to determine the right size of electric water heater, you need to consider the number of people living in the home, the average temperature of the incoming water, the size of the house, and the optimal temperature of the water. Homes with one to three occupants are usually safe with a 3 to 5 GPM water heater, but homes with four or more people will likely need an 8 or 9 GPM water heater.
How does an electric tankless water heater work?
Electric tankless water heaters use electricity to power a heating element or heat exchanger. The cold water enters the tankless water heater and flows through several loops, while the heating element rapidly heats the water. The water then exits the water heater at the desired temperature.
Why Trust The Spruce
Erica Puisis is a writer specializing in interior design and plant care. She writes about home products for The Spruce and has also contributed to Forbes and leading smart home blogs like Smart Home Solver and TechDigg. Additional reporting was done by Timothy Dale, an expert writer specializing in the home renovation, repair, and construction niche.