Pros and Cons of a Tankless Water Heater

You’ve probably heard the pitch — endless hot water, lower energy bills, and a compact design that frees up space. Tankless water heaters sound like an easy win, but they’re not always the best fit for every household. At Benjamin Franklin Plumbing®, we help homeowners in Nashville weigh the real pros and cons before making the switch. If you’re not sure, this guide can help you determine if a tankless water heater is a good match for your home and how you use hot water.

How Tankless Systems Actually Work

A traditional water heater stores a fixed amount of hot water in a tank, constantly keeping that supply heated and ready to go. A tankless unit works a little differently. It heats water only when you turn on the tap. Cold water moves through a heat exchanger and comes out of the faucet already heated. That setup means you aren’t limited by the size of a tank. The hot water keeps flowing as long as the system is sized correctly and everything runs smoothly. You might notice the biggest change in how your house feels during high-demand times. For example, if you have back-to-back showers in the morning or run a load of laundry while the dishwasher is going, a tankless unit has to respond instantly to those needs. That can work well if your household is steady in how it uses water. But if multiple hot water appliances run at once and your system wasn’t sized with that in mind, you might feel the limits a bit.

Space-Saving Appeal for Small or Busy Homes

One of the clearest differences between traditional and tankless water heaters is how much space they take up. A standard tank unit often sits in a corner of the basement or a closet and takes up several feet of space. A tankless model mounts on the wall and can tuck into tighter spots. That can make a big difference in homes with tight storage space or in remodels with limited square footage. Depending on the model, you can place them in more flexible areas like inside utility rooms or even on exterior walls. That frees up extra room for shelves, cleaning supplies or stacked laundry machines. For anyone trying to make the most of every inch, especially in homes without basements, the switch can be a step toward better use of the space you already have.

Efficiency Gains You Can Actually Feel

Because tankless heaters don’t keep water warm all day, they skip the constant energy draw you get with storage tanks. That means less wasted energy heating water that no one is using. Instead, the system responds only when you turn on a faucet or start an appliance. For many households, that leads to noticeable drops in utility usage, especially during seasons when hot water use is steady but not extreme. The longer you live in your house, the more this change tends to add up. If your family uses hot water in regular bursts — think morning showers, nightly dishwashing, and weekend laundry — then you'll reap the benefits without needing the unit to stay on call 24/7. That rhythm fits well with how tankless systems are designed to perform. But if your household has frequent, high-volume demands or the water temperature entering the system is very cold, it may run longer to keep up, affecting how much you save.

Upfront Investment and Installation Considerations

Switching to a tankless unit costs more than simply swapping out your old water heater for a newer version of the same type. It’s not just the unit itself. Tankless models often require upgrades to your gas line or electrical panel to handle the demands of instant heating. If your plumbing layout wasn’t built for a tankless system, that may involve rerouting pipes or adding venting to keep things safe and functional. While that setup may only need to happen once, it does mean a bigger investment upfront. If you’re already planning a remodel or your current water heater needs replacement soon, it might make more sense to build those upgrades into your project. But if you’re not ready for changes to your plumbing or gas system, it’s something to factor into the timing. A professional can talk through how your home is set up and what kind of prep work a tankless switch would require.

Long-Term Durability and Maintenance

Tankless water heaters usually last longer than regular tank models, especially with good care. Many can keep working for more than 10 years. Some even last up to 20 years, depending on how they’re used and the quality of the water. Because there’s no storage tank to collect sediment, you avoid the kind of buildup that can slowly wear down a traditional system. That said, maintenance still matters. Nashville’s moderately hard water can leave minerals inside the heat exchanger, which makes the unit work less efficiently and wear out faster. A technician can flush the system periodically to clear out scale and keep it heating smoothly. You might also need to clean or replace filters, depending on the model. These small upkeep steps help the unit stay efficient and avoid the kind of repairs that pop up when things are ignored for too long.

What About Electricity Use?

A common question is whether tankless water heaters use more electricity. The answer depends on the type you install. Gas-fired tankless heaters typically rely less on electricity, using it mostly for ignition and control functions. Electric tankless models draw more current to heat water on demand, which can mean a noticeable increase in electrical use during high-demand periods. That doesn’t mean they’re inefficient, though. In fact, they can still use less total energy over time compared to tank-based electric water heaters, which cycle on and off throughout the day. But they do place a higher load on your electrical system while in use. If you’re considering an electric model, especially in an older house, it’s worth reviewing whether your panel can handle the added draw without causing other issues.

Are Tankless Systems Worth the Upgrade?

The answer depends on what you value most in your home. If you want hot water on demand, more open space, and a system that keeps running with fewer breakdowns, a tankless unit checks a lot of boxes. It works especially well in households with consistent patterns of use or for homeowners planning to stay put for a long stretch. If you want a fast replacement or don’t want to change your plumbing, then a regular tank might be a better choice. But with energy costs going up and new technology getting better, more people are starting to like the idea of going tankless. The savings might not show up instantly, but they build quietly as the system avoids running during the long hours when no one needs hot water at all.

Planning for the Right Fit

Not every home is ready for a tankless water heater straight out of the box. The size of your household, the number of bathrooms, your appliances, and your daily routines all shape what kind of system makes sense. If you tend to run multiple showers at once or use lots of hot water during short time frames, you’ll need a unit sized to handle that load without slowing down or sending lukewarm water to the last person in line. Sizing also depends on the incoming water temperature in your region. In colder areas, the system has to work harder to raise the water to the right level. That means your unit's heating capacity becomes even more important. A plumber can walk you through those numbers and help figure out what fits your layout. That way, you’re not guessing how much water your system can handle. Rather, you’re planning around how your household actually runs.

Learn More About Tankless Water Heaters

Tankless water heaters have clear advantages, especially if you want hot water on demand and fewer bulky appliances in the way. That said, they also require a little planning, an upfront investment, and an honest assessment of how your household uses water. If you're curious about whether one would suit your home, schedule a consultation with Benjamin Franklin Plumbing® today.