How to Price a Water Heater Replacement

Price a water heater swap from your hours, not from the heater. A clean swap takes 2 to 3 hours. Anything unusual adds more, so quote the job you expect to find.

This is the job plumbers quote most, and the one they underprice most. Everyone remembers the price of the heater. But the heater is not the risk. Your time is.

A like-for-like swap means the same fuel, size and spot, shutoffs that work, and venting that already meets code. That takes an experienced plumber 2 to 3 hours. It covers draining, disconnecting, setting the new unit, connecting water and gas, purging air and checking for leaks.

Anything that is not like-for-like adds time:

• A unit in a crawlspace or an attic.
• A stand that has to be rebuilt.
• A rusted union you have to cut out.
• A gas valve that will not close.
• A vent that is now the wrong size for the new unit.

Two hours is a floor, not an estimate. Price the visit you expect, not the one you hope for.

Here is one way the numbers add up for a 50-gallon gas tank swap in an easy-to-reach garage. Every figure is an example. Use your own labor rate and your supplier's prices.

• Labor: 3 hours at your hourly rate. At $150 an hour, that is $450.
• The heater: your cost plus your materials markup. A mid-grade 50-gallon gas unit, marked up 30 percent, might come to $1,100 to $1,300 on the quote.
• Connection kit: water connectors, a gas connector, fittings, thread sealant, and a relief valve if the unit lacks one. Add a drain pan where the spot calls for one. Expect $50 to $100 of parts, marked up.
• Expansion tank: many places require one when the water service has a backflow preventer or a pressure-reducing valve. Put it on its own line so the customer sees why.
• Permit: most cities require a plumbing permit for this job, and some also want a gas or mechanical permit. Pass the fee through at cost. Add half an hour to pull it and meet the inspector.
• Haul-away: a line of its own. The old tank does not go in the customer's trash.

Add those up and a clean garage swap lands around $1,900 to $2,400 in this example. That is the number to stand behind, with each line explaining itself.

Look for these on the walkthrough, or ask about them on the phone. Each one is a fair extra line. None of them is yours to eat.

• Shutoffs that do not hold. If the main or the cold-side valve will not close, you replace a valve before you start.
• Venting. A new unit with a different vent height, or a switch to a power-vent model, means new vent work.
• Gas line size. A bigger burner on a long, thin gas line can starve the heater. Check before you quote a bigger unit.
• Code catch-ups. Earthquake straps where required, a drain pan and drain line above finished rooms, a sediment trap on the gas line, and bonding of the water pipes. The inspector will want them, so your quote should already have them.
• Access. Attic and crawlspace units add carrying time, and often a second person for an afternoon.

Write each one on the quote as its own optional line. A customer who sees the expansion tank priced on its own, as a code item, does not think you padded the job.

Show the job as 3 or 4 lines: not one lump, and not 20.

• The heater, with a short note on the model and its warranty.
• The installation, as one labor line.
• The permit and the haul-away, passed through.
• Each code item on its own line, with one plain sentence on why it is required.

Then say what is not included. For example: drywall repair, moving the heater to a new spot, or pipe repairs past the connections.

Keep the heater, the connection kit, the expansion tank, the permit and the haul-away in your price book. Then the next swap takes a minute to quote, and it comes out the same every time.