How Much Does It Cost to Replace a 50-Gallon Water Heater in 2025?

In the United States, 50-gallon water heaters are among the most common, so they make up a large volume of repairs and replacements. Costs vary a lot from place to place and even between the different types of water heaters, so shopping around, requesting multiple quotes, and doing research can ensure you get the best deal. Let’s break it down. 

Average Cost to Replace a 50-Gallon Water Heater in 2025

The average cost to replace a 50-gallon water heater in 2025 depends on the type and location. Josh Mitchell, owner of Plumbing Lab, shared that 50-gallon tank water heaters start at around $1,200 but may cost as much as $2,000 depending on where you live and installation difficulty. He added, “Prices are up about 15–20% compared to five years ago, primarily due to new energy efficiency requirements and rising labor costs.” You may incur additional costs if you have to schedule an emergency repair.

Electric water heaters account for the lower end of this range, while gas-powered water heaters are more expensive. Hybrid water heaters, or those that use a combination of gas and electricity, are often much more expensive than these ranges due to the additional complexity of installation.

However, 50 gallons isn’t always the optimal size, so it can be helpful to shop around and heed expert opinions. Here’s a quick comparison of the different costs for water heaters, including installation, in 2025:

How Location Affects Water Heater Replacement Costs

Location is one of the key factors that affects the cost of water heater replacement, but it is multi-faceted.

Permit Costs

New water heater installations and replacements often require permits, but the cost can vary tremendously based on your municipality and other local regulations. You can contact your local government for a breakdown of the fee schedule. For example, some areas will have a minimum fee for plumbing work, while others determine permit costs based on square footage. 

Accessibility and Labor

If your existing water heater is hard to reach or needs to be relocated to a better area in your home, you may have to pay additional costs to install or update plumbing lines and a power source. Labor costs can vary significantly depending on the cost of living and availability of qualified plumbers in your area, but they’re typically quoted hourly. The average hourly plumbing labor cost ranges from $75 to $200. 

Energy Source

The energy source that supplies your water heater significantly affects installation costs. Gas water heaters are typically more energy efficient and cheaper to run, but you can expect to pay more upfront to accommodate gas lines and sufficient venting. On the other hand, electric water heaters are initially less expensive but may cost more in the long term. 

Cost Breakdown: Labor, Materials, and Disposal Fees

Water heater replacement costs can best be understood in three parts: labor, materials, and disposal fees. Labor is your contractor’s fee for their time. Materials include the water heater and any parts needed to install it, and disposal fees are the costs to pick up, transport, and appropriately recycle or dispose of the water heater. 

• Labor: On average, you can expect to pay $150 to $500 for the labor. We recommend requesting a quote from at least three plumbers to confirm you’re getting the most competitive cost in your area. 
• Materials: Water heaters start around $500 at Big Box stores like Lowe’s and Home Depot, but they can cost up to $2,000. You can expect additional costs if your existing system needs to be brought up to code or otherwise updated to accommodate your needs.
• Disposal Fees: Many plumbing contractors will dispose of your old water heater for an extra fee, typically around $100. In the event that they don’t, you can contact a local scrapper or deliver it to a junkyard. 

Signs Your Water Heater Needs to Be Replaced

It’s 10 Years or Older

Water heaters have a maximum lifespan of about 15 years, but they lose efficiency and become outpaced by newer models as they age. If your water heater is 10 years or older, it can be helpful to schedule an inspection and request quotes for a replacement to determine if the time is right. 

You can also request figures on your anticipated energy cost savings within the first few years of replacement. These figures can prove the value of spending money upfront for long term savings. Keep in mind that last-minute and emergency replacements are often more expensive, so a proactive response can also save you money.

Discolored Water

Rust-colored or cloudy water can indicate corrosion in your water heater and surrounding pipes. A foul smell or metallic taste when you run the hot water can also indicate your water heater is no longer operating effectively due to sediment or other wear.

Leaks

Pools of water around your water heater or drips in the surrounding pipes can be a clear sign it needs repair. Cracks and rust are a frequent cause of leaks, so a visual inspection is usually enough to locate the source of the problem. If you’ve had to clean up water near your water heater more than once, it’s likely time to have a plumber assess the unit.

Frequent Repairs

If you’ve had to repair your water heater several times, you may be spending money in excess compared to a new unit. Next time you have a plumber out to repair your water heater, ask them to investigate your replacement options so you can compare costs. 

Higher Utility Bills

As your system ages, it loses efficiency. If you’ve noticed a recent spike in your electric or gas bills and can’t identify a cause, it’s a good idea to look at your water heater as a potential culprit.

Strange Noises

Look out for knocking, gurgling, or rumbling sounds, which can indicate you have sediment build-up in your water heater. Calcium and magnesium can reduce your water heater’s efficiency and potentially lead to other issues. 

Lack of Hot Water

One of the tell-tale signs your water heater needs to be replaced is if it can no longer keep up with your needs. Running out of hot water while you shower or hand wash dishes can indicate a loss of efficiency and overall function. 

How to Choose the Right Water Heater

You’ll need to keep a few things in mind to ensure you choose the right water heater for your needs:

Household Size

Your household size directly informs your hot water needs. Larger households will have more robust hot water demands, as will those with small children and pets. If your current water heater is already struggling to keep up with your hot water needs, you may need to upgrade to a larger size. Fifty-gallon water heaters are optimal for 3–5 person households, which aligns with the typical American family size.

Smaller households typically pair well with the tankless water heater’s on-demand style.

Fuel

You’ll have to shop for a water heater based on your home’s energy source. Gas-powered water heaters are often more expensive upfront, including the more complex installation costs, but they’re cheaper to run. Electric water heaters can be cheaper, but the energy costs are higher in the long-term. If you’re updating your fuel source, you can expect additional costs for that as well.

Energy-Star Rating

However, all water heaters are created equally. Shop around and compare different models. Energy-Star rated water heaters are more cost-effective in the long run.  

Installation and Maintenance

You’ll want to balance the cost of installation with ongoing maintenance. It can be tempting to DIY home repairs, but professional water heater installation and maintenance can be a core part of ensuring it reaches its full lifespan. You may have to have a professional inspection after installation to comply with regulations.

Tank vs. Tankless: Is Upgrading Worth the Cost?

Deciding between a tank and tankless water heater system is nuanced. Tank water heaters are more affordable to install and work well for families, but they have the major downside of energy waste. Tank-style water heaters will heat regardless of demand, so you’re paying for it whether you use it or not. 

Tankless water heaters are more expensive to purchase and install, but they’re much less wasteful from an energy perspective. They’re also ideal for smaller footprint homes that don’t have the square footage for a traditional water heater.

Dan Oppedisano, owner of Bedrock Plumbing and Drain Cleaning, says the energy source matters a lot here too. Gas tankless water heaters are known to be more efficient than their electric counterparts, which translates to a longer lifespan.  

Be Prepared for Water Heater Replacement with A Liberty Home Guard Home Warranty

While many water heater installation companies and manufacturers will supply an initial warranty, it’s unlikely to cover the life of your water heater. Purchasing a home warranty for a water heater outside its initial warranties can provide additional peace of mind without much added cost. However, it’s important to hold on to all maintenance records and to file claims promptly to avoid pre-existing claims issues. 

Our Systems and Total Home Guard plans cover water heater repairs and replacements for all mechanical parts up to $2,000, as long as they aren’t the result of sediment build-up. Even more, we have a massive network of qualified technicians who can respond and assess your water heater issues, often much quicker than you could locate and schedule a contractor on your own. Call (833) 547-3728  today or request an online quote to learn more about your coverage options.