Water Heaters: renting vs. buying - the best solution There are many advantages and disadvantages to buying or renting your hot water tank but with all the information out there trying to understand what is best for you may not be easy. So I have broken down the pros and cons for you so that you can make an informed decision to which is best for you - renting or buying your hot water tank. If you are looking only at the price - then buying is the logical way to go IF you plan on living in your house for the next 6 years or more. For example - most standard hot water tanks last approximately 10 to 12 years on average. So based on the low end (10 years) here is the differential.
$24 per month x 12 months = $288.00 per year times 10 years = $2,880.00 Total
New buying price average* (including installation) electric $700 to $900
New buying price average* (including installation) gas natural draft $900 to 1400
New buying price average* (including installation) gas power vent $1400 to $2000
Even if you buy a top of the line $2,000 power vent gas hot water tank you still have $880.00 in your pocket IF you buy instead of rent. The only exception to this is based on how long you plan on living in your current home. If you only plan on living there for only a few more years then 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 a gas HWT purchase)
5 years paying $288 per year = $1440.00 (more than a power vent gas HWT purchase)
As you can see, it really doesn't take very many years to more than pay for a new hot water tank in full - after those first few years it just doesn't make sense to rent. Now here is the information that many water heater suppliers don't want you to know - in Ottawa Ontario Canada the hydro company or Gas Company isn't the ones renting you the tank even though you pay them each month - they are actually renting them to you through a different company that you may or may not even be aware of! To find out whom you are actually renting your water heater from look at your itemized utility bill.