Whether your water heater just died or you're proactively upgrading before it fails, one of the first things you want to know is what it's going to cost. Water heater prices in Texas depend on three main factors: the type of unit (tank vs. tankless), the size, and the fuel source (gas vs. electric). Here's a detailed breakdown for 2026.
Tank Water Heater Installation: $1,200–$2,000
A standard tank water heater is still the most popular choice for Central Texas homes. The unit stores 40–75 gallons of hot water and keeps it at temperature around the clock. When your old tank dies, replacing it with a new one of the same type is usually straightforward.
40-gallon tank (1–2 bathrooms): $1,200–$1,500 installed. This size works for 1–2 person households. It's the most affordable option and fits in the same footprint as your existing unit.
50-gallon tank (2–3 bathrooms): $1,400–$1,800 installed. The most common size for Central Texas homes. Handles a family of 3–4 people with typical usage — showers, dishwasher, laundry.
75-gallon tank (3+ bathrooms): $1,700–$2,000 installed. For larger families or homes with soaking tubs, multiple simultaneous showers, or high hot water demand.
These prices include the water heater, standard installation, haul-away of the old unit, and all fittings and connections. If additional work is needed — like upgrading a water line, moving the unit to a new location, or bringing the installation up to current building code — that adds to the cost.
Tankless Water Heater Installation: $2,500–$5,000
Tankless (on-demand) water heaters heat water as it flows through the unit rather than storing it. They take up much less space, last 15–20 years (compared to 8–12 for a tank), and use 8–34% less energy because there's no standby heat loss.
Whole-house gas tankless: $3,000–$5,000 installed. Gas tankless units produce higher flow rates and can handle multiple fixtures simultaneously. However, retrofitting from a tank to a gas tankless often requires upgrading the gas line (from 1/2 inch to 3/4 inch) and installing new venting — both of which add to the cost.
Whole-house electric tankless: $2,500–$4,000 installed. Electric tankless units are simpler to install but require significant electrical capacity — often a dedicated 200-amp panel and multiple 40-amp breakers. If your home's electrical panel needs upgrading, that's an additional cost.
Point-of-use tankless: $500–$1,200 installed. These small units serve a single fixture — like a bathroom sink or a kitchen faucet far from the main water heater. They're useful for eliminating the long wait for hot water at distant fixtures.
Gas vs. Electric: Which Costs More?
Gas water heaters have a lower operating cost in Texas because natural gas is relatively cheap here. A gas tank unit costs about $25–$35/month to operate. The upfront cost is slightly higher because of venting requirements, but you save on your monthly utility bill.
Electric water heaters are cheaper to purchase and install (no venting needed) but cost more to operate — roughly $40–$55/month in Central Texas. They're a good choice for homes without a gas line or for locations where venting is impractical (like an interior closet).
Heat pump water heaters are the most efficient option — they use about 60% less energy than a standard electric tank. Installed cost is $2,000–$3,500, but federal tax credits and energy savings can offset the premium within a few years. They need to be installed in a space with adequate airflow (not a tiny closet) because they pull heat from the surrounding air.
Size Chart: How to Choose the Right Capacity
1–2 people: 30–40 gallon tank, or a tankless unit rated for 2–3 GPM.
3–4 people: 40–50 gallon tank, or a tankless unit rated for 4–5 GPM.
5+ people: 50–75 gallon tank, or a tankless unit rated for 6+ GPM (or two smaller tankless units in parallel).
Undersizing is one of the most common water heater mistakes. If you consistently run out of hot water, the unit is too small for your household. Oversizing wastes energy because you're keeping more water hot than you need.
What's Included in a Kimco Installation
When you get a water heater installation from Kimco, the flat-rate price includes removal and disposal of the old unit, the new water heater, all necessary fittings, connections, and valves, a new expansion tank (required by Texas code), testing and commissioning, and cleanup. If any additional work is needed (gas line upgrade, electrical work, relocating the unit), we'll identify that during the estimate and include it in the quote — no surprises after the job starts.
Should You Repair or Replace?
If your current water heater is under 8 years old and the repair is under $500, repair usually makes sense. If it's over 10 years old and needs a repair over $300, replacement is almost always the better investment. You'll get a new warranty, better efficiency, and peace of mind.
Get a Free Estimate
Ready to replace your water heater? Call Kimco at (737) 260-7255 for a free, no-obligation estimate. We'll assess your household's hot water demand, recommend the right type and size, and give you a flat-rate price on the spot. We stock the most common tank and tankless models and can usually install same-day or next-day. Serving Taylor, Rockdale, Giddings, Bastrop, Elgin, and all of Central Texas.