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Before you buy a heater, think about:

The kind of water heater you want

A traditional tank (storage) heater or a tankless (demand) one? The first one comes with a tank in which water is stored before it is heated and dispensed. On the other hand, the tankless heater does not have a storage area. It heats water as and when hot water is required. Tankless heaters are known to be approximately 24% - 34% more energy-efficient than storage heaters. They also last around 10 years longer than conventional heaters.

Size of the water heater

If you opt for a tank water heater, pay careful attention to the size of the tank or the storage area. If you choose one that is too small, you may constantly find yourself short of the necessary amount of hot water. On the other hand, if the tank is too large for your needs, it will result in energy wastage. Alternately, instead of one big central heater, you can choose several smaller heaters.

A tankless heater is a more flexible option. Since you get water on demand, the size of the heater does not matter.

Where you should install the water heater

If the new heater is replacing an older one, consider installing it in the same place. This way, the new heater will not require extensive plumbing modifications.

Permissions needed for installation

Mostly, water heater installations need to follow certain municipal codes. Most municipalities insist on licensed professionals getting a permit first. They may also mandate regular inspections before the heater is first used.

Whether you can fit it in the rough-in

If the heater installation is part of a new construction or a remodel, it can be included in the rough-in section of the project. This way, you can first identify and mark out gas lines and other electrical and plumbing lines necessary for the actual installation. This makes the installation easier and more fool-proof.

The kind of fuel you prefer

The basic choice is between electricity and natural gas. Choice of fuel will determine your cost of use. This may vary across locations. For example, where price of gas is expensive, using a heater that runs on gas may not be feasible.