[HarryD]

I have mixed feelings about tankless water heaters.

PLUS
-Unlimited hot water
-If installed very close to the point of use, the water is hot right away
-Compact

NEGATIVE
-If someone likes to hang out in the shower, you will spend a lot on hot water. A regular water heater runs out and makes them stop.
-Must be sized to match the demand. If too small you will not have enough hot water. If to large, it will not heat properly.
-If far from the point of use, it can take a while to get the hot water to where you need it just like a tank type heater.

Personally, except for a hand sink in a remote bathroom or lacking adequate space, I would go with a standard tank type water heater.