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Water Heater Replacement Cost

Water heater replacement cost can vary depending on the type of water heater, tank capacity, and a few other factors.

Your water heater is a very important piece of equipment to your home and your family’s home comfort. You use it every single day when taking a shower, doing the dishes, or doing the laundry. If your looking to replace your current water heater, one of the pieces of information you’d like to know first is the water heater replacement cost. Below you’ll find all of the relevant pricing information you’ll need before you choose the water heater that aligns with your budget and needs.

Water Heater Replacement CostCost distribution: Equipment vs. Labour

Water heater replacement cost involves the cost for both the equipment as well as the labour involved with installing the new equipment and getting rid of your old water heater. The cost distribution is 73% on equipment and 27% on labour. The average costs for a standard water heater tank are $850 for equipment and $315 for labour.

The cost for replacing a water heater can range from $250 to $8,300, with the average cost being $1,500.

Water heater options:

Traditional Tank Water Heaters

Traditional water heaters have a tank which stores water and is fueled by either gas or electricity. The water tanks can hold between 20 to 80 gallons depending on their size. Compared to their tankless counterpart, traditional water heaters have a lower upfront cost but maintenance and operation costs are higher. The cost of a traditional water heater can range between $950 to $2,100, with the average cost being $1,310.

Traditional Water Heater Features & Their Impact on Cost

The price of a traditional water heater can vary greatly depending on the size of the unit, with larger capacity units costing the most. Water heaters that are more energy efficient will also cost more, but will save money on operation due to their energy efficient operation. The most energy efficient water heaters are typically Energy Star certified. Government rebates may also help to lower the cost of an energy efficient water heater. If there is any additional work that needs to be done to complete the installation up to code or to make room for the new unit, then the cost will also increase.

Tankless Water Heaters

Tankless water heaters are fueled by gas or electricity in the same way that traditional heaters are, but they do not store any water within the unit. Tankless water heaters heat the water on-demand as its needed. This makes tankless heaters more environmentally friendly than traditional water heaters.They also have the benefit of being able to provide you with endless hot water, A tankless water heater will have a higher upfront cost, but a lower operation cost. The cost of a tankless water heater can range between $2,045 to $5,900, with the average cost being $2,980. On-demand tankless units can conserve between 24% to 34% more energy than tank water heaters in homes that use 41 gallons or less of hot water. The higher cost of a tankless water heater will be paid off in the long run due to its lower cost of operation and higher level of efficiency.

Natural gas water heaters tend to be more expensive to run than electric water heaters. If you’re thinking of switching from an electric to a natural gas water heater, it’s important that you factor in the cost of running gas lines. As electricity prices continue to increase across Canada, it would be in your best interest to compare the cost of running a natural gas or electric water heater in your area.

Labour and Equipment Removal Costs:

A significant component of the water heater replacement cost is the amount you pay for the labour involved from a licenced and trained professional technician. Technicians can choose to charge a flat rate or by the hour for the labour work involved with installing your new water heater. Labour costs can include charges for addition any electrical, gas or plumbing connections for your new water heater. There may also be a disposal fee for removing and disposing of your old equipment.

Factors That Impact Water Heater Replacement Cost:

  • Changing fuel sources
  • Changing from traditional to tankless
  • Amount of work necessary to bring plumbing connections up to code
  • Size of the water tank
  • Cost of the permit
  • Length of the warranty
  • Energy efficient certification
  • Any other special or upgraded features


If you are in need of a new water heater, but don’t want to spend thousands of dollars upfront then our rent to own water heater program may be what you’re looking for. With our rent to own program you pay zero dollars upfront and instead pay a single low monthly fee. Our rent to own program provides you with peace of mind as any maintenance or repairs are already included in the program at no additional cost.


If you have any further questions regarding water heater replacement cost or any of your other HVAC needs, don’t hesitate to contact DeMark Home Ontario today. We offer a free installation done by our highly trained and experienced technicians. You’re saving more when you rent your water heater from DeMark Home Ontario. We offer the lowest rental rates on the market and provide our customers with professional and reliable service. If you’re considering an upgrade to a new high efficiency water heater for your home, DeMark Home Ontario is here to make the change as easy and convenient as possible. For more information, give us a call at 1 (855) 998-2998 or fill out our online request form and we will be happy to assist you.

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Notice for Power Vent Water Heater Customers

Effective August 2007, gas code requires technicians working on venting to replace black ABS vent pipe with white UL-certified vent pipe.

We will upgrade your venting pipes at no additional cost.

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