Tankless water heaters are transforming the way we get hot water to our sinks, showers, and other fixtures. They save space, are efficient, and can  provide unlimited hot water. This makes them a hot item for homeowners and residential contractors.

If you're looking for the best tankless water heater for your application, look no further. Below is a list of top picks I've compiled to help take the uncertainty out of the decision. Please spend some time reading through each of our categories, selections, and criteria for picking the best tankless water heaters. 

 

The Best Tankless Water Heaters

Best Tankless Water Heater	Best Gas Tankless Water Heater	Best Electric Tankless Water Heater	Best Propane Tankless Water Heater	Best Point of Use Water Heater
A.O. Smith X3	Takagi T-H3J	Eemax HA027	Rheem RTGH-RH	Eemax SPEX95T

 

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How We Picked the Best Tankless Water Heaters

When selecting the best tankless water heaters, we take four main criteria into account: Reliability, efficiency, warranty, and overall value. 

 

Reliability

We focus on how reliably tankless water heaters supply hot water for showers, dishes, clothes, and other basic needs. There's no room for error. If you're a contractor, same thing. You want to sell your clients a water heater that will work right the first time and minimize callbacks.

We consider construction, design, performance, maintenance, longevity, and other characteristics that impact reliability. For example, what is the heat exchanger made of? Is installation straightforward? Do you have to perform annual maintenance?

The best tankless water heaters do their job silently in the background without you having to think about them too often. You should be able to trust them.

 

Efficiency

Efficiency, or how much energy the tankless water heater puts out versus how much it uses, is another consideration. The Uniform Energy Factor (UEF) measures water heater efficiency, with higher numbers being more efficient.

Whenever possible, we recommend condensing tankless water heaters. These are the most efficient models because they use a secondary heat exchanger to capture extra heat from the exhaust. The less heat wasted through the exhaust, the more being used to heat your water, which is what we want.

Another aspect of efficiency is whether a tankless water heater has built-in recirculation, which keeps hot water circulating in your pipes. That way, when you turn the faucet, you don't have to wait for the water to turn hot. This can save several gallons of water per day. 

 

Warranty

We expect tankless water heater makers to offer a good warranty in case anything goes awry.  After all, tankless water heaters are an investment in your home and hygiene, so they need to stand the test of time. Typically, manufacturers include a warranty for the heat exchanger and parts, so that's what we look at when evaluating.

 

Overall Value

Although we do consider the price point in our best tankless water heater recommendations, it takes a back seat to overall value. The old phrase, "you get what you pay for" rings true.

Sure, you could choose the cheapest option, but what happens when it stops working after a year? Then, instead of spending a couple hundred extra dollars, you're spending more than a thousand on a new unit. Great quality at a good price is what we're after.

 

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Best Tankless Water Heater: A.O. Smith X3 

A.O. Smith has long been the gold standard in water heaters, and this proves why. The A.O. Smith X3 gas tankless water heater provides years of uninterrupted service thanks largely to its hallmark X3 scale prevention technology.

This innovative capability prevents minerals from forming harmful deposits on the heat exchanger and eliminates the need for manual descaling. In fact, it extends the heater's life up to three times longer than competing units! What's more, the copper heat exchanger is corrosion-resistant and provides better heat transfer than stainless steel.

Efficiency-wise, the X3 carries a 0.93 UEF because its condensing technology minimizes heat loss from the exhaust. It also meets Ultra Low-NOx emission requirements found in southwestern states. From a water-saving perspective, the X3 is approved to work with an external recirculation pump and cross-over valve so you get immediate hot water. No more having to wait through those initial cold blasts.

A.O. Smith backs this water heater with an amazing five-year warranty on parts and a whopping 15-year warranty on the heat exchanger! You are truly getting a reliable and efficient unit for the price. If you want an easy answer to "what's the best tankless water heater?" the A.O. Smith X3 is it.
 

Spec	Details	Rating
Reliability	Scale prevention tech eliminates annual descaling; Heavy duty, corrosion-resistant copper heat exchanger; Built-in freeze protection; Overheat cutoff fuse; temperature safety controls
Efficiency	Condensing tech; 0.93 UEF; Energy Star Certified; Meets Ultra Low-NOx emission requirements; Will work with an external recirculation pump
Warranty	15-year heat exchanger warranty; 5-year parts warranty
Overall Value	Unbeatable reliability and performance at a fair price

 

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Best Gas Tankless Water Heater: Takagi T-H3J

When comparing only gas tankless water heaters, efficiency takes center stage, which is why I'm recommending the Takagi T-H3J. This unit has a 0.94 UEF thanks to its condensing technology. A secondary stainless steel heat exchanger recaptures heat from the exhaust and uses it to preheat your water, minimizing waste. The primary heat exchanger is made of commercial-grade HRS35 copper, designed to be effective at heat transfer and resilient against corrosion, so you can count on it for years to come.

The T-H3J meets Ultra Low-NOx emission requirements in California and other states. Beyond this, it comes with a host of safety features, including an air-fuel ratio sensor that helps optimize combustion, exhaust and water temperature safety controls, an overheat cut-off fuse, and an internal freeze protection system. Contractors will like the unit's advanced diagnostics that make troubleshooting a breeze.

Takagi offers a generous 5-year warranty on parts and a 12-year warranty on the heat exchanger, so you can rest assured that your purchase is protected. Overall, you'll get unlimited hot water reliably and efficiently at a price that is relatively low for this type of unit.

Specs	Details	Rating
Reliability	Commercial-grade HRS35 copper primary heat exchanger is corrosion-resistant; Internal freeze protection system; Built-in temperature controls & advanced diagnostics
Efficiency	Condensing tech; 0.94 UEF; Energy Star Certified; Meets Ultra Low-NOx emission requirements; Copper heat exchanger provides excellent heat transfer
Warranty	12-year heat exchanger warranty; 5-year parts warranty
Overall Value	Reliable and highly-efficient water heater at a very affordable price.

 

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Best Electric Tankless Water Heater: Eemax HA027

The Eemax HA027 electric tankless water heater is nearly 100 percent efficient and very simple to install. Since it runs on electricity, you don't need to worry about venting or having a natural gas supply. It's easily wall-mounted and has simple compression fittings that don't require soldering.

The Eemax HA027 can give you lots of hot water for washing and personal hygiene. It has different models that can provide up to 4 gallons per minute with a 60° F increase in temperature. Copper immersion heating elements with a threaded brass top help maximize durability and make for easy replacement. The external display and controls allow you to easily view and adjust the temperature by degree.

One major point to note, however, is that the Eemax, and all electric tankless water heaters, have an immense power draw. For example, the 3 GPM Eemax has a current draw of 113 amps and a recommended breaker size of 120 amps. That's too much for homes with 100 - 200-amp electrical panels to handle. If you decide to go with an electric tankless water heater, you may need to work with your electrician and utility company to upgrade your service, wiring, and/or electrical panel.

Making those upgrades can definitely be worth it, though, especially if you lack access to natural gas and need electric-powered solutions. The unit comes with a 1-year warranty on parts and a 5-year warranty on the heat exchanger. If you have the ability to use it, definitely go with the Eemax HA027 for your water heating needs.

Specs	Details	Rating
Reliability	Copper immersion heating elements; Precise external temp. controls; Flexible installation
Efficiency	99% efficient
Warranty	5-year heat exchanger warranty; 1-year parts warranty
Overall Value	Efficient and effective water heating solution if you have the electrical service to handle it.

 

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Best Propane Tankless Water Heater: Rheem RTGH-RH 

Rheem has been around for more than 100 years, so they know a thing or two about designing the best tankless water heaters. That's a major reason why, if you need a propane unit, I recommend the Rheem RTGH-RH.

At 0.94 UEF, the RTGH-RH is highly efficient thanks to its condensing technology, and it also meets all Ultra Low-NOx emissions requirements. Thus, you can count on it to provide excellent water heating without driving up your propane costs.

Built-in recirculation means you'll save water too. The recirculation pump will keep hot water circulating in your pipes, serving even your most distant water fixtures on demand. This will reduce the amount of water you waste waiting for it to get warm.

The heater can be vented directly or concentrically and connected to a 1/2-inch gas line, making installation easier for your installer.  Another convenient feature is its size. The RTGH-RH is small in size, measuring about 2.3 feet tall and 1.5 feet wide. This allows for easy placement in any location without occupying much space.

With a 5-year parts and 12-year heat exchanger warranty, the RTGH-RH comes with excellent protection from Rheem. If you're dependent on propane as a fuel source, look no further for your water heating needs.

 

Specs	Details	Rating
Reliability	Dual stainless steel heat exchangers; Reliable direct or common venting options
Efficiency	Condensing tech; 0.94 UEF; Energy Star Certified; Built-in Recirculation pump can reduce water waste
Warranty	12-year heat exchanger warranty; 5-year parts warranty
Overall Value	Great technology, especially the built-in recirculation pump, at a good price.

 

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Best Point-of-Use Water Heater: Eemax LavAdvantage™ SPEX95T

If you're looking for instant hot water to a distant bathroom or utility faucet, you're going to want a point-of-use tankless water heater connected directly to that one fixture. I highly recommend the Eemac LavAdvantage SPEX95T tankless water heater for this purpose.

The SPEX95T provides 1.1 GPM of water at a 60° F water temperature rise, which is toward the higher end of single-fixture, point-of-use water heaters. That means you can use it for virtually any kitchen, bar, or bathroom sink, as well as eyewash fountains. It'll kick on when it detects at least 0.2 GPM of water flow, which is the industry's lowest activation rate and is perfect for multiple sensor or metering faucets in commercial or public applications.

Built compactly and designed for quiet operation, the SPEX95T will blend into its surroundings, able to mount in any orientation. Self-diagnostics with intelligent controls actively protect the heater, and a high-temperature limit switch enables safe operation. It also includes active energy management with precise temperature controls for sensitive applications like eyewash stations.

The water heater comes with a 5-year limited warranty on leaks and a 1-year warranty on parts. Overall, it's the perfect little unit for a single faucet fixture that's far from your main water heater.

Specs	Details	Rating
Reliability	Activates at 0.2 GPM of water flow; Includes self-diagnostics with intelligent controls; Prevents dry firing
Efficiency	0.98 UEF; Designed to provide instant hot water to the fixture; Active energy management & temp. control feature
Warranty	5-year limited warranty on leaks; 1-year warranty on parts
Overall Value	Great, low-cost water heating solution for a single sink faucet.

 

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Tankless Water Heater FAQs 

How Does a Tankless Water Heater Work?

A tankless water heater works by heating cold water instantaneously as it passes through the system. Gas tankless water heaters use heat exchangers, while electric and point-of-use tankless water heaters use heating elements.

Unlike a traditional storage-tank water heater, which regularly heats water in a large tank whether it's needed or not, a tankless water heater activates only when someone turns the hot water faucet. As a result, tankless water heaters are more efficient and much smaller since they don't require a tank.

They also cannot run out of hot water as long as they're properly sized, since they only heat as needed. Tankless water heaters require a significant amount of energy to rapidly heat water. As a result, you may need to upgrade your gas line or increase your electrical power supply. 

Learn more in our tankless water heater buyer's guide.

 

What Size Tankless Water Heater Do I Need?

Properly sizing a tankless water heater is crucial to ensure it can handle all your hot water needs instantaneously. If you buy an undersized heater, it won't be able to keep up with your needs, and you'll be dealing with cold showers!

To size a tankless water heater, you need to determine 1) the flow rate of all the hot water fixtures you'll plan to run at once and 2) the required water temperature rise in your area. Water temperature rise refers to how many degrees the water heater will need to raise the incoming water temperature. Once you have those pieces of information, you can use our free tankless water heater sizing tool to find recommended products.

 

Shop All Tankless Water Heaters

 

Can I Replace My Old Water Heater With a Tankless?

Yes, you can replace your old water heater with a tankless water heater. If you're replacing a tankless unit with a new tankless unit, it should be a clean swap. However, if you're replacing a storage-tank water heater with a tankless unit, there are a few extra considerations, particularly with gas-powered units.

Most storage-tank water heaters have plumbing connections on top, while many tankless units have them on the bottom. Switching may require extra material costs for your installer because they'll need to add plumbing to your existing setup.

Another consideration is the greater energy required by tankless water heaters to heat water on demand. If you have a gas model, you may need to make your gas line bigger. If you have an electric model, you might need to upgrade your panel or service. Be sure to discuss these and any additional requirements with your professional installer, and never attempt the installation yourself.

 

How Long Does a Tankless Water Heater Last?

A tankless water heater should last 20 years or more when properly maintained. Proper maintenance includes periodic inspections and descaling, which is the removal of limescale deposits caused by hard water. Some units, like the A.O. Smith X3, are able to prevent scale from forming and eliminate the need for this kind of maintenance.

 

 

About Ken 

Ken DeJong has been a versatile handyman for decades, able to adapt to every home improvement challenge thrown his way. From working on cars in his youth, to installing carpet, and even doing decorative painting, Ken is a determined jack-of-all-trades. He served as a manager at Lowes before joining the Power Equipment Direct team.

 

Ken has amassed a wealth of product knowledge across various categories, especially when it comes to heating and cooling equipment. He has taken roughly 130 hours of professional training hosted by industry vendors and now trains others in his department. He’s particularly fascinated by ductless mini splits and the inverter technology that makes them exceptionally quiet and efficient.

When he's not helping customers choose the right evaporator coil or tankless water heater, Ken puts his creativity to use designing t-shirts and writing royalty-free instrumental music. To sum up, Ken is a professional who is obsessed with acquiring new skills and sharing his knowledge to help others optimize their home living.