Water Heaters - Renting Vs. Buying - The Best Solution

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.

CONSUMER REPORTS WATER SOFTENERS

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.

per month x 12 months = 8.00 per year times 10 years = ,880.00 Total

New buying price average* (including installation) electric 0 to 0

New buying price average* (including installation) gas natural draft 0 to 1400

New buying price average* (including installation) gas power vent 00 to 00

Even if you buy a top of the line ,000 power vent gas hot water tank you still have 0.00 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 8 per year = 6.00

3 years paying 8 per year = 4.00 (more than an electric HWT purchase)

4 years paying 8 per year = 52.00 (more than a gas HWT purchase)

5 years paying 8 per year = 40.00 (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.

Hidden costs - Many utility companies offer you extended warranties on your water heater so you could be paying an additional .50 to .00 per month for a warranty** that actually has NO VALUE! If you want the proof simply request a written copy of your extended warranty... they may cover the tank itself, but they usually do NOT cover the parts that are more likely to break like the heating element, the pressure relief valve, replacing the anode, OR labour costs: just the tank itself which is just a big metal water bottle without all the working parts.

Here is the next surprise along the way - most of these warranties are ONLY valid if the water heater is properly maintained and serviced (as stated in your owners manual IF you even kept that document). So here's the question: did you pay to have it serviced annually? Odds are you didn't (like all the rest of the people I know including myself) which means they don't have to honour your warranty.

Not only does the warranty cover nothing but now the warranty isn't even valid - even if you pay for it every single month on time for 10 years!

Let's do the math on that extended warranty (based on a cheap .50 per month price):

.50 per month x 12 months = .00 times 10 years = 0.00

Can you imagine giving away 0 of your hard earned money for a warranty that doesn't even exist?

Consumers love feeling secure in their purchases, but too many times they get taken for a financial ride that will keep them paying for years to come. The company renting the tank to you gets rich while we end up retiring broke - all those years of paying could have been avoided and that a month payments could be going to your retirement or vacation account! Wouldn't you rather have the extra money sitting in YOUR bank account earning you interest rather than making the utility companies richer?

Please note that not all companies are the same when it comes to renting hot water tanks and that there are a few companies out there who do actually offer you value for your money, but they are not easy to find. It requires that each of us 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 to 5 years then where is the money savings? Here are the things to look for when buying or renting a hot water tank:

What brand and model of hot water tank is being offered? Does the price include installation? Does the price include the now mandatory in Ontario "mixing valve"? Does the installer offer any guarantees on their installation? Is the installer licensed to install these tanks or is he just a handyman (please note that using a handy man can potentially negate your home owners insurance policy IF damage occurs due to the improperly installed water heater). What guarantees are offered (if any)? Is the guaranty "pro-rated"? A pro-rated guaranty works just like your car value, buy a new car and drive it off the lot and it already depreciates in value - a pro-rated warranty no matter how long it is will not cover the costs of replacing the tank only a small portion of the tank only value (usually excludes installation as well). If the warranty is only going to cover 0 of the costs after only 2 years then what value is that warranty if you have to dish out the balance? Does the installer offer a maintenance plan for your hot water tank? The anode should be replaced every 3 years in the city, every 2 years in the country on well water.
Nothing in life is simple - but you can certainly take simple steps to insuring that you are getting value for your hard earned money. Please note that you may have to pay a bit more up front to get the security and warranties you want, but in the long run it will save you serious money.

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 buying prices are based on Ottawa Ontario Canada pricing and may not accurately reflect the prices in your country or region.

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

Water Heaters - Renting Vs. Buying - The Best Solution

CONSUMER REPORTS WATER SOFTENERS