Quick answer
Replacing a tank water heater in Ontario costs $1,200–$2,500 installed; a tankless conversion runs $3,500–$6,500, with the most common 199,000 BTU gas swap landing at $4,200–$5,000. The number moves with tank size, power-vent versus atmospheric venting, gas-line work, and whether the old unit is owned or rented — a rental buyout comes on top. Repairs, for comparison, run $150–$800.
How much it costs to replace a water heater in Ontario is one of the more predictable HVAC numbers, but the range is wide because 'a water heater' covers everything from a basic 40-gallon atmospheric gas tank to a wall-hung condensing tankless with new venting and gas piping. Five things drive the quote — fuel, size, venting, gas line and ownership — and every one of them is visible before anyone lifts a wrench.
Typical installed costs in the GTA
- Gas or electric tank water heater: $1,200–$2,500 installed, depending on size and venting.
- Tankless (on-demand) water heater: $3,500–$6,500 installed, including gas-line and venting work.
- The most common conversion — a 199,000 BTU Rinnai or Navien replacing an existing tank: $4,200–$5,000 installed.
- Minor repairs instead of replacement: $150–$800, worth pricing if the unit is under 8 years old.
- Diagnostic service call: $90–$150, typically credited toward the work if you proceed.
What drives the price
- Tank size and fuel — a 50-gallon gas tank costs more than a 40, and a power-vented model adds the blower and its wiring.
- Venting changes — switching from atmospheric to power-vent, or to condensing tankless, means new PVC venting through the wall and a condensate drain.
- Gas line — a tankless conversion often needs the run upsized from 1/2-inch to 3/4-inch, adding $400–$1,200; the tankless cost guide itemizes it.
- Code items — an expansion tank where the house has a check valve or pressure-reducing valve on the main, a drain pan over finished space, and a proper discharge pipe on the relief valve.
- Removal and disposal of the old unit, which a professional install includes.
Owned or rented changes the first step
Before pricing anything, confirm you own the current unit — a large share of GTA and Hamilton homes are still on a rental contract someone else signed. If it is rented, ending the contract means a buyout based on the tank's age, sometimes plus removal or termination charges, and that figure belongs in your comparison. Since Ontario's 2024 ban on registering Notices of Security Interest (NOSI) on title, rental companies can no longer attach these contracts to your home's title, which has made switching to an owned unit cleaner. Renting vs. buying walks through the full lifetime math.
Tank or tankless at replacement time?
Replacement day is the cheapest moment to switch types, because you are paying for the labour either way. Stay with a tank if the budget is tight, the household is small, or a move is plausible within a few years. Go tankless if you run out of hot water, want the floor space back, and will stay long enough for the energy savings and the longer lifespan to earn back the premium — is a tankless worth it in Ontario weighs both sides.
What a proper replacement quote includes
- A TSSA-licensed technician on the gas side — a tank swap is licensed work in Ontario, not a handyman job.
- A new shut-off valve, proper connections and a drip leg on the gas drop, rather than reused corroded fittings.
- The relief valve's discharge pipe run toward the floor, and the venting checked — including a draft test on an atmospheric tank sharing a chimney.
- The tank filled, purged and fired, with combustion or element operation verified before the crew leaves.
- A written price before work starts, disposal included, and the warranty registered with the install date.
How long the replacement takes
A like-for-like tank swap is 2–3 hours of on-site work, because 40- and 50-gallon gas tanks are stocked locally. A power-vent conversion adds the fan wiring and new venting, and a tankless conversion with gas and venting work is most of a day. If the old tank is leaking, close its cold-water feed valve and shut off the gas or breaker while you arrange the swap — that caps the flood at what is already on the floor. For a unit that is ailing rather than dead, the repair-vs-replace analysis keeps you from sinking money into a tank at the end of its life.
ZK Mechanical replaces tank and tankless water heaters across the GTA and Hamilton, with written pricing before the work and financing through lending partners — request a free quote or call (647) 801-1252.