Pros and Cons of Tankless Water Heaters

November 8, 2026

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  • Family owned & operatedMulti-generational business since 1975
  • 40+ years of experienceHeating and cooling know-how since 1975
  • Based in GravenhurstServing homes and cottages across Muskoka

Is it worth switching to a tankless water heater? For many homes it is, but not all. A tankless water heater heats water on demand instead of keeping a large tank hot around the clock, and that one difference drives every advantage and every drawback. Here is an honest look at the pros and cons of tankless water heaters from a family-owned Gravenhurst contractor that has served Muskoka since 1975.

How a Tankless Water Heater Works

When you open a hot tap, cold water flows into the unit. A gas burner or electric element heats it as it passes through, and hot water leaves the heater straight away. When the tap closes, the heater shuts off. There is no storage tank to keep hot, so nothing is heated while no one is using hot water.

A traditional tank water heater does the opposite. It stores a set volume of hot water and reheats it whenever the temperature drops, which is why it uses energy even when the house is empty.

The Pros of Tankless Water Heaters

  • They are more efficient than traditional tank-style water heaters. With no standby heat loss from a storage tank, energy efficiency is generally better, especially in homes that use a modest amount of hot water.
  • Hot water on demand. A properly sized unit keeps delivering hot water for as long as the tap is open, so back-to-back showers are not limited by tank size.
  • Tankless water heaters can last much longer. Many units have a longer service life than a typical storage tank, and parts can often be replaced instead of the whole heater.
  • A smaller footprint. Wall-mounted units free up floor space in a utility room, basement or cottage mechanical closet.
  • No storage tank to fail. There is no large tank that can corrode and release a lot of water at once.
  • Energy savings over time. Because the heater only runs when you need hot water, many homeowners see lower energy use on their utility bills.

The Cons of Tankless Water Heaters

What are two disadvantages of a tankless water heater? The two we hear about most are the higher upfront cost and the limits of your water supply and fuel or electrical service.

  • Higher upfront cost. The unit and the installation work usually involve more than a like-for-like tank replacement.
  • Flow limits. Every tankless heater can only heat so much water at once. Running several showers, the dishwasher and the washing machine together can exceed a smaller unit's capacity.
  • Gas, venting and electrical upgrades. A gas model may need a larger gas line and new venting. An electric model may need extra electrical capacity at the panel.
  • Cold-water sandwich. After a brief pause in use, a short slug of cooler water can reach the tap before hot water returns.
  • Maintenance matters. Muskoka homes on well water often have mineral content that builds scale inside a heat exchanger, so regular flushing is important.
  • Power outages. Most tankless models need electricity to operate, even gas-fired ones.

What Do Plumbers Say About Tankless Water Heaters?

Our honest view: tankless is a very good choice for the right house. It suits homes with steady hot water use, households that want to reclaim floor space, and cottages or second homes where a tank would otherwise sit hot and idle. It is less compelling when the home has a very high simultaneous demand and limited gas or electrical service, or when the budget for installation is tight.

Can You Replace a 50 Gallon Water Heater With a Tankless Water Heater?

Yes, in most cases you can. A 50 gallon tank is a common size for a family home, and a tankless unit can replace it. What matters is sizing the tankless heater to your peak demand, which depends on how many fixtures run at once and how cold your incoming water is in winter. Gas lines, venting, electrical capacity and your water quality all need to be checked before the swap.

Tankless vs Tank vs Heat Pump Water Heater

Tankless and tank heaters are not the only options. A heat pump water heater moves heat from the surrounding air into the water and can be very efficient. See What Is a Heat Pump Water Heater? and our Heat Pump Water Heater Installation page to compare.

Is It Worth Switching?

Tankless is usually worth considering if: - You plan to stay in the home for years - You value efficiency and a longer-lasting unit - Your gas or electrical service can support it, or you are willing to upgrade - Your household does not run many hot water fixtures all at once

A tank (or heat pump) water heater may suit you better if upfront cost is the priority or if your home's service would need major upgrades.

Installation, Repair and Maintenance in Muskoka

Bridlewood Mechanical installs, repairs and services water heaters across Gravenhurst, Bracebridge and the Muskoka region. We assess your hot water usage, available space and energy preferences before recommending a system. Learn more about Tankless Water Heater Installation, or see our main Water Heater Installation & Repair page. Already seeing trouble with your current heater? Read Signs Your Water Heater Is Failing.

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Free, no-obligation quote

Get in touch with Bridlewood

Tell us what's going on with your heating, cooling or water heater and we'll follow up to book a visit.

Prefer to talk? Call us directly(705) 706-7622

We only use your details to reply to this request.

Thanks, we've got your request.

We'll be in touch shortly. Need us sooner? Call (705) 706-7622.

  • Family owned & operatedMulti-generational business since 1975
  • 40+ years of experienceHeating and cooling know-how since 1975
  • Based in GravenhurstServing homes and cottages across Muskoka