Choosing between a tank and a tankless water heater comes down to household size, hot water habits, fuel and venting, and how long you plan to stay in the home. Tank heaters cost less up front and are simple to replace. Tankless heaters cost more to install but last longer, use less energy and never run out. Here is how to decide.

How they work

A tank water heater stores 40 to 75 gallons of pre-heated water. The downside is standby heat loss: the unit fires to keep that water hot whether or not anyone is using it. A tankless unit heats water on demand as it flows through a heat exchanger, so there is no storage and no standby loss, but the unit has to be sized for your peak simultaneous demand.

Installed cost in Oshawa and Durham Region (2026)

These ranges come from our article on hot water tank replacement in Oshawa:

  • Standard tank (40 to 60 gallon): $1,200 to $3,500 installed, depending on brand, venting type and whether it is gas or electric.
  • Power-vent tank: $1,800 to $3,800 installed.
  • Tankless (on-demand) unit: $3,000 to $6,000 installed. Gas line upsizing, dedicated venting and a condensate drain are common reasons a tankless install lands at the higher end.

Our 2026 cost guide lists water heater installation at $500 to $1,500, tank or tankless, depending on the model and installation complexity. Every job is quoted in writing before we start.

Lifespan

A tank water heater typically lasts 8 to 12 years. A tankless unit can last considerably longer with annual descaling. Hard water across Durham Region shortens the life of both, and skipping the descaling on a tankless unit is the fastest way to lose that advantage. A water softener helps protect either type.

Efficiency

According to Natural Resources Canada, an ENERGY STAR certified tankless water heater uses 30% less energy, on average, than a storage tank type. Over the life of the unit those savings add up, but the higher installed price means the payback depends on how much hot water your household uses.

Hot water capacity

A 50 gallon tank can run two showers at the same time for a while before it runs cold, then it needs time to recover. A properly sized tankless unit keeps delivering hot water as long as gas and water are flowing. For larger households, or homes where two bathrooms are used at the same time every morning, that is the biggest quality-of-life difference.

Which should you choose?

Choose a tank water heater if you have a small household, you are replacing on a tight budget, you do not plan to stay long, or your gas line and venting cannot take a tankless unit without major upgrades.

Choose a tankless water heater if you have a larger household, you regularly run out of hot water, you want long-term energy savings, you are finishing a basement or renovating anyway, or you want to free up the floor space the tank occupies.

Talk it through with a licensed plumber

Hayes Plumbing installs and services both. Call (905) 576-3043 or request an estimate and we will size the right unit for your home and give you the installed price in writing. See our water heater service and tankless water heater pages for more.