The Cost of Your Hot Water Heater
You’ll be surprised by the real cost of renting your water heater. Here’s why you should own.
Most homeowners in Ontario rent their water heater. It’s a habit. Everyone rents their hot water heaters, right?
But you don’t have to. Renting your water heater is actually more expensive and leaves you with fewer options for changing or upgrading your service and appliance.
If you’re budget conscious, you should seriously consider owning. If you want greater control over your home, ownership of your water heater (and other home comfort appliances) is an option you should consider.
Here’s the straightforward rundown:
- The cost of renting in Ontario is somewhere between $16 and $40 a month from the big utility-like companies, depending on the size and type of your tank.
- A typical water heater will last 15-20 years when properly maintained
- After about 8 to 9 years, ownership becomes markedly better on your budget than renting.
The yearly increases in hot water heater rental costs
Read the fine print. Your rental contract most likely includes an increase to the rental cost every year, usually between 3.5% and 3.8%. Over the life of a typical rental contract, your cost could go up by more than 45%. That’s not what you signed on for!
Here’s an example of the cost of renting over
15 years (a typical rental contract term):
|Year||Water heater rental cost with a yearly increase of 3.8%|
|1||$25.00 a month ($300.00 for the year)|
|2||$25.95 a month ($311.40 for the year)|
|3||$26.93 a month ($323.16 for the year)|
|4||$27.95 a month ($335.40 for the year)|
|5||$29.01 a month ($348.15 for the year)|
|6||$30.11 a month ($361.35 for the year)|
|7||$31.25 a month ($375.00 for the year)|
|8||$32.44 a month ($389.28 for the year)|
|9||$33.67 a month ($404.04 for the year)|
|10||$34.95 a month ($419.40 for the year)|
|11||$36.28 a month ($435.36 for the year)|
|12||$37.66 a month ($451.92 for the year)|
|13||$39.11 a month ($469.34 for the year)|
|14||$40.60 a month ($487.18 for the year)|
|15||$42.14 a month ($505.69 for the year)|
|16||You try to negotiate a new contract and keep
paying for a water heater you don’t own.
By the end of your contract, you’ve spent over $5,900 on renting your water heater! And, the payments will just keep going up! And did you ever receive maintenance from your rental company to keep your tank working efficiently and in a safe manner? Probably not!
The cost of your hot water heater is much more manageable if you own. It’s not the standard in Ontario for some reason, but it should be. And it will be.
Here’s what your monthly payments look like with monthly cost of ownership over 12 years:
|Year||Water heater monthy cost of ownership|
|1||NO PAYMENTS for the first 3 months!
$25.00 a month ($225.00 for the year)
|2||$25.00 a month ($300.00 for the year)|
|3||$25.00 a month ($300.00 for the year)|
|4||$25.00 a month ($300.00 for the year)|
|5||$25.00 a month ($300.00 for the year)|
|6||$25.00 a month ($300.00 for the year)|
|7||$25.00 a month ($300.00 for the year)|
|8||$25.00 a month ($300.00 for the year)|
|9||$25.00 a month ($300.00 for the year)|
|10||$25.00 a month ($300.00 for the year)|
|11||$25.00 a month ($300.00 for the year)|
|12||$25.00 a month ($300.00 for the year)|
|13||You’re done paying and now you own
your water heater!
With monthly cost of ownership, the monthly payments will remain the same. The best part, once you’ve finished paying, there will be no more payments! You will own the water heater outright, and your total cost is only $3,525!
Plus, CLARITY by ClimateCare has been providing you with maintenance, included in your purchase*, so your water heater is still in great shape long after you’ve finished paying for it!
How long do you plan to live in your current home?
If owning your water heater becomes more financially smart after 8-9 years, should you own if you might move before that? Yes!
Your owned water heater can simply be included in the asking price when you sell your home. You’ll never get the money back you spent on your rental contract.
Plus, you could run into trouble if the people buying your home don’t want to assume your hot water heater rental contract. To close the deal, you may have to buy out your hot water heater agreement at an inflated cost, including potential penalties, often much more than you would have had to pay if you simply removed it and installed a new one. This could be a serious complication to a purchase and sale agreement. Owning removes that complication and keeps things simple.
* Annual maintenance performed when performing a precision tune-up on any other piece of home comfort equipment.