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California homeowner discovers rain-damaged water heater was indoor-only, voiding the warranty

"Don't build an enclosure around it, it's still outside."

A tankless water heater.

Photo Credit: iStock

One California homeowner got a costly surprise after a new tankless water heater was installed outside, failed immediately after rain exposure, and lost its warranty coverage.

Here's what to know

After rain damaged the board on a tankless water heater, a Los Angeles-area homeowner described the situation on Reddit's r/Homeowners forum. 

In that thread, the homeowner said a local plumber had placed the new unit outside and later wrote, "My board on my tankless went out after the most recent rain."

The failure led to a call with a technician, who, according to the homeowner, identified the bigger problem: the heater was meant for indoor installation. The original poster then said the tech informed them that "my tank is an indoor and should not be installed outside. Because of that, my warranty is void."

With the warranty apparently no longer in play, the disagreement became about the fix. The plumber reportedly offered to repair the system and "build a housing around the water heater," but the homeowner wondered whether it would make more sense to insist on a full replacement.

OP then asked, "Is it acceptable for me to ask him to change out the water heater? Clearly, that would be thousands of dollars that he would have to swallow, and I doubt he'll want to do that. What should I do when he refuses?"

Commenters pointed out that an exterior setup is not automatically wrong and asked who picked the equipment. The OP responded to this question, confirming that the plumber had made that choice, writing, "He selected the unit for me but had me purchase [it] for 'warranty purposes.'"

The local climate also helps explain why the setup did not initially seem suspicious. When one commenter reacted to the idea of outdoor plumbing, the homeowner replied, "Los Angeles a few miles inland. Got our own slew of issues but frost's not one."

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That context shaped the homeowner's decision to go along with the install. They added, "He didn't explain it was an indoor unit. I live in Los Angeles and plenty of tankless are outdoors. The last place I rented before buying had an outdoor tankless. From my understanding there are tankless that are made for outdoor use. I assumed that is what he had me get, so yes I agreed for him to install it outside."

Most of the advice in the thread focused on properly replacing the unit rather than trying to shield the wrong one with an enclosure. One commenter suggested an "incredibly obvious compromise…You purchase a unit meant to be outdoors and he installs it for free." 

Another user was even more direct: "Don't build an enclosure around it, it's still outside."

Where can I learn more?

Water heater problems can get a lot messier when warranty disputes or installation mistakes are involved.

• One homeowner won a replacement after a leaking water heater was initially denied under warranty.

• After a second unit leaked, homeowners said the warranty should apply to the repeated failure.

• A homeowner's gas unit kept shutting off until the warranty helpline flagged possible venting problems.

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