Not all home upgrades are created equal. Some are purely cosmetic – quick fixes to win over buyers at a glance. Others sit in the background, quietly improving how a home functions and feels day to day. One such behind the scenes upgrade is the tankless water heater.

You won’t see it in the home listing headline but for many buyers today energy efficient systems play a growing role in how they assess value. So will installing a tankless water heater bump up your property’s appeal – and price? The answer isn’t a simple yes or no but there’s plenty to consider.

What Is a Tankless Water Heater, Really?

“Unlike conventional water heaters that heat and reheat water at a preset temperature regardless of your needs, tankless models heat water only when you turn the faucet on. This means no more cold showers and no energy wasted on heating water you won’t use”, says Metropolitan Hot Water.

No running out of hot water mid hair wash. No big cylinder taking up valuable storage space. And no wasted energy keeping unused water hot in case someone decides to do the dishes later.

It’s a simple but significant shift in how homes manage water heating – and it’s gaining ground with builders and renovators looking to create more streamlined, efficient homes.

Why Energy Efficiency Is Now a Selling Feature

It’s easy to overlook systems hidden in cupboards or behind walls but energy use is part of the conversation in many property inspections. Buyers are savvier. Rising energy costs have forced them to think not only what they’re buying but what it will cost to run.

A report from the University of Technology Sydney’s Institute for Sustainable Futures found that domestic hot water accounts for about one quarter of household energy use and around one fifth of residential greenhouse-gas emissions.

That’s a sizable chunk of your household’s energy footprint—second only to heating and cooling. So, when a prospective buyer sees that a home has already been upgraded with a more efficient system, they don’t just see the convenience. They see lower energy bills and a smaller environmental impact.

Will It Actually Raise Your Price?

Here’s where nuance matters.Installing a tankless water heater won’t add tens of thousands to your home’s value on its own. It’s not the kind of upgrade that gets gasps at open homes. But it can contribute to the broader picture of a home that’s well thought out, lower in running costs and ready for the future.

It’s often less about the raw dollar figure and more about marketability. A home with modern infrastructure – especially one that promises lower power bills – is easier to sell and in some cases may sell faster or get a better offer in competitive markets.

Buyers today are looking for signs a home has been cared for. Replacing an old, inefficient water heater with a sleek modern tankless system sends a clear message: this isn’t a home full of problems waiting to happen. It’s a place to move into.

When It Makes Sense

While every home could technically benefit from a tankless system the impact on value tends to be strongest in certain contexts.

• Smaller homes or townhouses: Where cupboard or floor space is at a premium the compact nature of tankless systems becomes a real advantage. You get back valuable storage that would otherwise be taken up by a cylinder.
• Eco-conscious homes: If your property already has solar panels, energy efficient lighting or good insulation a tankless system adds to the sustainability story and makes the home more attractive to green minded buyers.
• Homes with growing families: Larger households have more intense hot water needs. A well sized tankless system means everyone can shower in the morning without someone getting stuck with cold water – a seemingly small thing that can actually leave a big impression.
• Buyers who’ve done their homework: Some prospective buyers turn up with spreadsheets in hand. They’ve compared power bills, calculated long term costs and weighed up features that offer real savings. A modern energy smart hot water system fits into that equation.

What About the Cost and Practicalities?

It would be misleading to say there’s no cost or complexity involved. Switching to a tankless system especially if you’re moving from an older or different type of system can involve changes to plumbing, wiring or gas lines. That’s why professional installation is essential – not just for safety but to make sure the unit performs as it should. 

Some properties may need more than one unit especially if you have multiple bathrooms that are used at the same time. Getting the sizing and placement right matters. An undersized system won’t meet demand and that can lead to frustration rather than value.

Maintenance is another thing to consider. Tankless systems need to be flushed or serviced annually to prevent mineral build-up especially in areas with hard water. It’s not complicated or expensive but it’s something homeowners need to stay on top of.

That said many owners find these systems more reliable and longer lasting than conventional hot water units. With fewer moving parts and no tank to corrode or rupture the long term maintenance can actually be simpler once the system is in place.

A Subtle Edge in a Crowded Market

Think of a tankless water heater as part of a modern home’s quiet confidence. It may not sparkle like a new benchtop or trendy pendant lights but it adds weight where it counts – lower bills, less maintenance and thoughtful design.

And in a property market where buyers increasingly ask, “What’s it going to cost me to live here?” Those small details start to stand out. A home that runs efficiently, heats water only when needed and frees up valuable space? That’s the kind of practical upgrade that appeals to both head and heart.

Making It Count in Your Listing

If you’re installing one with resale in mind don’t bury the feature. It’s worth mentioning in the listing description especially alongside other modern upgrades. Phrases like “energy efficient on demand hot water system” or “modern tankless water heater for reduced power bills” help plant the seed with buyers who may not have considered it before.

And if you’re not selling anytime soon all the better – you get to enjoy the convenience, comfort and savings yourself.

Final Thoughts

A tankless water heater won’t turn a modest home into a mansion. But it will improve how the home feels to live in – and how it’s perceived when viewed. It tells a subtle story about what kind of owner you are: someone who plans ahead, who values efficiency and who understands not all upgrades are meant to be flashy.

Some just quietly make life better. And when the right buyer walks through the door they’ll notice.