Buying Guide

Types of Water Heaters

Storage Tanks vs. Tankless

Choose between a traditional storage tank type water heater or a smaller, eco-friendly tankless water heater. They both work with gas and electric fuel sources. 

TIP: Make sure it fits. Compare the dimensions of your new water heater with the space you have available for your unit at home.

Types of Water Heaters
water heater storage tanks
tankless gas
point of use
Description Stores constantly heated water. Heats cold water with a gas burner or electric element as it passes through the water heater. Heats cold water via an electrical heating element and heat pump that pulls in ambient air and extracts the available heat. Delivers instant hot water to a specific location without wait time.
Feature/Benefits Economical. Can be positioned in closet, basement or garage. Capacity ranges from 20 to 80 gallons. Efficiency varies between models, brands and fuel sources. Requires a larger up-front investment. Hangs on wall and frees up floor space. Excellent option for residences occupied part-time. Reduces energy consumption by as much as 30%. Can run out of hot water during heavy usage. Requires ventilation. Requires a larger upfront investment. Magnesium anode rod extends life of the tank. Heat pump delivers more hot water, up to 33% faster than standard electric water heaters. Typically supplements a whole house system.
Storage Tank Water Heaters
a standard storage tank water heater

Storage tank water heaters are the most common type of water heater. They heat and store a large volume of hot water that can be dispersed throughout your entire home. 

  • They constantly use energy to keep stored water at a temperature near 120 degrees Fahrenheit at all times. 
  • If you buy a new tank that's too small, you'll run out of hot water before you need to. And if you get a tank that's too big, you're wasting money on heating water you won't use. 
Tankless Water Heaters
a tankless water heater

Tankless water heaters do not store heated water, but rather heat water only when you turn on the faucet or shower. 

  • These are also called demand-type or instantaneous water heaters.
  • They can save you money over traditional tank models because they eliminate the expense of continually keeping water hot in a storage tank between uses. 
  • You may need more than one tankless water heater depending on how far your unit is from all the rooms in your home that need hot water.
Point-of-Use Systems
a point-of-use water heater

Point-of-use systems are individual units that install directly under the sink or in a closet to supply a single, specific fixture. These types of units: 

  • Deliver instant hot water to a specific location without wait time. 
  • Work with a whole house system when additional hot water is needed.  
Hybrid Water Heaters

Hybrid water heaters have heat pumps that heat water by pulling the heat out of the surrounding air. Hybrids:

  • Have a higher upfront cost and are larger than standard electric units.
  • Are available as built-in water tanks or add-ons to existing tanks.
  • Are more energy efficient, which can result in lower bills. 
How to Choose a Water Heater

 First, pick your fuel type

  • Electric: less expensive, replaceable heating elements 
  • Natural gas: more expensive, more space for installation, more energy efficient 
  • Propane: heats water twice as fast as electric, takes up less space

Then choose between a storage tank or a tankless water heater. 

Storage Tank Water Heaters

Choose the right size storage tank water heater by matching its water gallon capacity to the number of people who will regularly use hot water in your home.
Household Size -- Gallon Capacity

  • 1–2 -- 23-36
  • 2– 4 -- 36-46
  • 3–5 -- 36-46
  • 6 or more --  56+

TIP:  If you need a larger unit than the space you have, you can relocate your unit or ask a Home Depot associate about non-standard sizes, such as a “low boy” model, which is shorter and wider. 

Tankless Water Heaters
Calculate Temperature - Water Heater

1.  Calculate your flow rate.
Use this chart to calculate the flow rate or gallons per minute (GPM) of hot water that each of your fixtures and appliances need. Add these amounts together for the total GPM for your household. For example, if you typically have a shower, dishwasher and washing machine running at the same time, you have a flow rate of 3.5-7.5 GPM.
Fixture/Appliance: Typical Flow Rates

  • Bathroom      Faucet: 0.5 – 1.5 GPM
  • Kitchen      Faucet: 3.0 – 7.0 GPM
  • Shower:      1.0 – 2.0 GPM
  • Dishwasher:      1.0 – 2.5 GPM
  • Clothes      Washer: 1.5 – 3.0 GPM

2.  Find your home’s required temperature rise.
Your temperature rise is the difference between your ground water temperature and your desired hot water temperature – typically around 120 degrees Fahrenheit. For example, if you live in Atlanta, you have a ground water temperature of 67 degrees Fahrenheit. To reach an ideal hot water temperature of 120 degrees Fahrenheit, subtract 67 from 120. You have a required temperature rise of 53 degrees Fahrenheit. Use the EPA’s map for average ground water temperature for guidance.

3.  Match your GPM and temperature rise to your new water heater unit.
TIP: Ask a Home Depot associate questions about choosing the right size water heater or contact our Installation Services team for help. 

Energy-Efficient Water Heaters

Look for the Energy Factor (EF) rating on the package. The EF rating measures how efficiently a water heater converts energy into heat as well as how much heat is lost during storage, if applicable. The higher the energy factor, the more efficient the water heater.  

Tankless Water Heater Installation Tips
  • Be sure the location you choose for installation meets the unit's ventilation requirements.
  • Install on a wall near a gas supply line, water supply line and electrical power source. This is also the easiest and most cost-effective way to run the venting.
  • Install on a wall near a gas supply line, water supply line and electrical power source. This is also the easiest and most cost-effective way to run the venting.
Tank and Hybrid Water Heater Installation Tips
  • We urge you to consider professional installation for tank water heaters for your safety.
  • The unit should have ½-inch clearance on the sides, 12 inches on the front and 18 inches off the floor.
  • The unit should have ½-inch clearance on the sides, 12 inches on the front and 18 inches off the floor.
  • Hybrids offer a narrow, 21-inch diameter for access into smaller locations. Allow a 7-inch clearance around. Install in a dry indoor area with access to or with at least 10 feet of circulating air.