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A good water heater project runs in four steps: size it (first hour rating for a tank, GPM at your temperature rise for tankless), choose a type, vet the installer and confirm licensing and permits, then verify the work at handover. Skipping the sizing step is the most common and most expensive mistake.

Sizing. Write down your busiest hour of hot water use — showers, dishwasher, laundry, all of it. Then buy a storage unit whose first hour rating covers it, or a tankless unit whose GPM at your winter incoming temperature covers it. ENERGY STAR's certified gas storage units carry an FHR of at least 51 gallons and certified gas tankless units at least 2.8 GPM over a 67°F rise — use those as reference points, not as your answer.

Choosing a type. The default is like-for-like. Move away from it only for a named reason: you run out of hot water, you need the space, you want the lowest electric running cost (heat pump, UEF 3.30+ under ENERGY STAR criteria), or you are already redoing venting.

Vetting. Verify the license on your state licensing board's own lookup. Confirm insurance. Require an itemized quote with the specific model number. Ask who pulls the permit. Get three bids if you are not in an emergency — NerdWallet's 2026 ranges ($600-$2,500 tank, $1,400-$3,900 tankless) tell you when a bid is far outside normal.

Verifying. Permit number, inspection scheduled, warranty registered, no drips, T&P discharge properly terminated, shutoffs shown to you, temperature set deliberately. Then put the paperwork somewhere you will find it in eight years.

How to choose

Do the busiest-hour exercise before you shop
Ten minutes with a pen prevents the two most common outcomes: an undersized unit you regret daily, and an oversized one you pay to keep hot for 12 years.
Verify licensing at the source
State licensing boards publish searchable lookups. A license number on a truck is not verification.
Plan the replacement before the failure
Past year 10 on a tank, start getting bids. A planned replacement costs less and lets you actually choose.
Never DIY gas or venting
Sizing, shopping, and even flushing an electric tank are reasonable homeowner activities. Combustion appliances are not.
Keep every document
Invoice, model and serial, permit, inspection report, warranty registration. All five get asked for eventually — at a claim, a service call, or a sale.
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FAQ

Water Heater guides — common questions

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Estimate your peak hour of hot water use and match it to the unit's first hour rating for a storage tank, or to GPM at your winter temperature rise for tankless. Household size is a rough proxy; peak simultaneous use is the real driver.
Verify the license on your state board's lookup, confirm insurance, require an itemized quote with the exact model number, and ask who pulls the permit. Get three bids when it is not an emergency.
Replacing in a panic. An emergency swap means one quote, no sizing exercise, no permit conversation, and whatever unit is on the truck. If your tank is over 10 years old, start the process now.
Some installers will, many will not, and it can affect warranty coverage — several manufacturers condition coverage on professional installation and may treat retail-channel units differently. Ask about the warranty implications before buying the unit yourself.
Sources

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