Water heaters: rent vs. buy – the best solution

There are many pros and cons to buying or renting your hot water tank, but with all the information out there, trying to understand what’s best for you may not be easy. So I’ve broken down the pros and cons so you can make an informed decision about which is best for you: rent or buy your hot water tank.

If you’re just looking at price, then buying is the logical way to go IF you plan to live in your home for the next 6 years or more. For example, most standard hot water tanks last about 10-12 years on average. So based on the low end (10 years), here’s the spread.

$24 per month x 12 months = $288.00 per year multiplied by 10 years = $2,880.00 Total

Average New Purchase Price* (Including Installation) Electric $700-$900

New average purchase price* (installation included) natural gas shot $900 to 1400

New Median Purchase Price* (Including Installation) Gas Vent $1,400 to $2,000

Even if you buy a top of the line $2,000 electric vented gas hot water tank, you still have $880.00 in your pocket IF you buy instead of renting.

The only exception to this is based on how long you plan to live in your current home. If you only plan to live there for just a few more years, you can certainly save money by renting.

2 years paying $288 per year = $576.00

3 years paying $288 per year = $864.00 (more than an electric HWT purchase)

4 years paying $288 per year = $1152.00 (more than an HWT gas purchase)

5 years paying $288 per year = $1440.00 (more than an electric vent gas HWT purchase)

As you can see, it really doesn’t take many years to pay off a new hot water tank; after those first few years, it just doesn’t make sense to rent.

Now, here is the information that many water heater suppliers do not want you to know: In Ottawa, Ontario, Canada, the hydroelectric company or the gas company is not the one that rents you the tank even though you pay them every month , they are actually renting them. to you through a different company that you may or may not be aware of. To find out who you are renting your water heater from, look at your itemized utility bill.

Hidden Costs – Many utility companies offer extended warranties on your water heater, so you could be paying an extra $2.50-$11.00 per month for a warranty** that actually has NO VALUE! If you want proof, just ask for a written copy of your extended warranty…they may cover the tank itself, but usually do NOT cover the parts that are most likely to break, like the heating element, pressure relief valve , the anode replacement, OR labor costs – just the tank itself, which is just a big metal water bottle without all the working parts.

Here’s the next surprise down the road: Most of these warranties are ONLY valid if the water heater is properly maintained and repaired (as stated in your owner’s manual, IF you kept that document). So here’s the question: did you pay to have it checked annually? Chances are they haven’t (like everyone else I know, including me), which means they don’t have to honor their warranty.

Not only does the warranty cover nothing, but now it’s not even valid, even if you pay for it every month on time for 10 years!

Let’s do the math for that extended warranty (based on a cheap price of $2.50 per month):

$2.50 per month x 12 months = $30.00 per 10 years = $300.00

Can you imagine giving away $300 of your hard earned money for a warranty that doesn’t even exist?

Consumers love to feel safe in their purchases, but many times they find themselves in a financial ride that will keep them paying for years to come. The company that rents the tank to you gets rich while we end up retiring broke – all those years of pay could have been avoided and those $24 a month payments could go into your retirement or vacation account! Wouldn’t you rather have the extra money in YOUR bank account to earn interest rather than enrich the utility companies?

Keep in mind that not all companies are created equal when it comes to renting hot water tanks and there are some companies that really do offer you value for your money, but they are not easy to find. It requires each of us to do our homework to discover the real value of what is being offered.

Also note that the cheapest price may not always be the best price. If you have to keep replacing your hot water tank every 4 or 5 years, where is the money saved? Here are the things to look for when buying or renting a hot water tank:

• What brand and model of hot water tank is offered?
• Does the price include installation?
• Does the price include the now mandatory “mixing valve” in Ontario?
• Does the installer offer any guarantee on its installation?
• Is the installer licensed to install these tanks or is he just a handyman (note that using a handyman can potentially void your homeowners insurance policy IF damage occurs due to an improperly installed water heater).
• What guarantees are offered (if any)?
• Is the guarantee “prorated”? A prorated warranty works just like the value of your car, buy a new car and drive it off the lot and its value already depreciates – a prorated warranty, no matter how long it lasts, won’t cover the costs of replacing the tank alone. a small portion of the value of the tank only (usually excludes installation as well). If the warranty will only cover $100 of the costs after only 2 years, what is the value of that warranty if you have to spread the balance?
• Does the installer offer a maintenance plan for your hot water tank? The anode must be replaced every 3 years in the city, every 2 years in the country with well water.

Nothing in life is simple, but you can certainly take simple steps to ensure you’re getting value for your hard-earned money. Keep in mind that you may have to pay a little more up front to get the security and collateral you want, but it will save you a lot of money in the long run.

Be sure to check out my other articles on hot water tanks and water heaters for more ways to save money and avoid damaging your most precious asset, your home!

*Note: Average purchase prices are based on prices in Ottawa, Ontario, Canada and may not accurately reflect prices in your country or region.

**Guarantees differ from vendors and companies, read the fine print to understand what those differences are. Some extended warranties are worth the extra costs, most are not.