Tankless water heaters—also known as on-demand water heaters—have become increasingly popular among homeowners seeking energy efficiency, longer-lasting equipment, and virtually endless hot water. But as with any home upgrade, they’re not a one-size-fits-all solution. If you’re considering making the switch from a traditional tank system, it’s important to understand the pros and cons, how they work, and whether a tankless system is the right fit for your home’s needs.
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How Tankless Water Heaters Work

Unlike traditional water heaters that continuously store and heat a tank of water, tankless systems heat water only when you need it. When you turn on a hot water tap, cold water flows through a heat exchanger powered by electricity or gas, rapidly warming the water on its way to the fixture.

Because they don’t store hot water, tankless heaters can provide a virtually endless supply—ideal for larger households, back-to-back showers, or filling deep bathtubs without worry.

The Benefits of Going Tankless

The biggest appeal of a tankless water heater is efficiency. Since the system doesn’t work to maintain a standing supply of hot water, you avoid the constant energy drain associated with tank-based heaters. That means lower utility bills, especially if you use a lot of hot water or have multiple people in the home.

Tankless systems also take up much less space. They’re wall-mounted and compact, freeing up storage or utility room space—especially beneficial in smaller homes.

Another benefit is longevity. While traditional water heaters last around 8–12 years, tankless models often last 15–20 years with proper maintenance. And because they’re less prone to the sediment buildup that affects tank systems, they typically experience fewer performance issues over time.

When a Tankless Water Heater Might Not Be Ideal

Despite their advantages, tankless water heaters aren’t the right solution for every home. One of the main drawbacks is the upfront cost. Installation and equipment are more expensive than traditional systems, and depending on your home’s plumbing and electrical setup, retrofitting can add to that cost.

In some cases, tankless systems may struggle to keep up with simultaneous hot water demands—like running multiple showers and the dishwasher at the same time. To address this, some households opt to install multiple units or point-of-use heaters near high-demand areas, which again adds to the cost.

It’s also important to consider local water conditions. In areas with hard water, like many parts of Michigan, mineral buildup can affect the performance of any water heater, tankless or not. Regular maintenance, including flushing the system, becomes especially important to prevent scaling and reduced efficiency.

Gas vs. Electric Tankless Heaters

If you decide to go tankless, the next question is whether to choose a gas or electric model. Gas units typically offer higher flow rates and are better suited for larger households. However, they also require proper venting and access to a natural gas line.

Electric units are smaller, easier to install, and often more energy-efficient in smaller homes or for point-of-use applications. That said, they may not provide enough flow for larger homes with simultaneous hot water demands.

A professional plumber can assess your household needs and recommend the best type and size based on your usage patterns, home layout, and available utilities.

Considerations Before Making the Switch

Before deciding to switch to a tankless water heater, you should:

• Assess your daily hot water usage.

• Consider how many fixtures or appliances might run at once.

• Determine if your current plumbing and electrical systems are compatible.

• Evaluate how long you plan to stay in the home (to justify the upfront cost with long-term savings).

• Think about your space and whether freeing up room with a compact system is a priority.

While the initial cost is higher, the long-term energy savings, space savings, and increased comfort often outweigh the upfront investment for many homeowners.

Make the Smart Choice for Your Water Heating Needs

Tankless water heaters are efficient, space-saving, and deliver hot water when you need it—without the waste and worry of a storage tank. But like any major home improvement, the key to success lies in matching the right system to your needs and ensuring a professional installation.

Premier Plumbing is here to help you evaluate whether a tankless water heater is right for your home. Our team will assess your household’s hot water demands, provide honest recommendations, and handle installation with expert care. Contact us today to schedule a consultation and take the first step toward smarter, more efficient hot water.