1. Just bought existing house that currently uses propane. Existing water heater is in the utility room. The only location for it in that room is in front of the freezer resulting in only being able to halfway open the door. So that is not a great location for a regular water heater. House is a 2000 sf one story house. Also as currently installed the T&P drain line slopes upward and does not have gravitional flow. In any event, not sure where else a regular water heater could be placed other than the utility room. If anyone has ideas would consider it.

2. Live in Texas, near Houston to it is not usually that cold.

3. Electrical panel is undersized and has a number of problems so we are changing the electrical panel and upgrading from 125 amp to 200 amp service even if we don't get a tankless water heater. We want to convert the house to all electric water than having propane at all.

4. To go tankless, electrician recommends 225 amp service instead of 200. This costs an additional $500 over the 200 amp service we would betting for a standard water heater.
Also for a standard water heater, he would install a 120/240 volt 40 amp circuit. For tankless he would install a 120/240 volt 120 amp circuit which is $535 more. So the extra electrical for the tankless water heater is a total of $1035 more.

I don't love the idea of spending $1035 more for tankless. I am willing to do it if the tankless will be advantageous or if I will be able open my freezer door! With the tankless there would be room to install it and still open the freezer door. Without tankless I would either have to lvie with the freezer door issue (I don't want to) or find somewhere else to relocate the water heater, but not sure what is feasible.

Oh, house is 2000 sf, there are 4 people living in it now. In a few years there will be 2.

Any thoughts?

A unit that draws 100 amps and uses two 60 amp breakers would produce 5 gpm (two showers) @ 105 degrees with 70 degree water going in. If the water inlet temp drops to 59 degrees, it's 3.8 gpm - not two showers.

I think that's borderline for a family of 4 unless you tell me the water inlet temps remain 70degeees or more.

House has two bathrooms so probably not that difficult to avoid two people taking showers at once. Might have shower and dishwasher running at same time.

If it is undersized, what kind of options might exist to relocate the regular water heater? What kind of space would it need?

I'm in TX, SW of Houston. I'm on a private well, semi-rural area at edge of my town. My pump tank is in my (detached) garage. My well and (submerged) pump is wayyyy around on the other side of the property due to logistics and requirements of sufficient space for both a well and septic, so it's a long (but underground) run from the pump to the tank. During the occasional cold snaps like this past winter, incoming water temp can drop to less than 40°F. In heat of the summer it may be 80°F or a tad more. My electric tankless is a 120amp unit. It doesn't have any problem generating 135°F to 140°F output when I (occasionally) want that high a temp for washing a load of whites. Otherwise I set the tankless at 100°F to 102°F in summer, 104°F in winter for normal use. That low temp is fine for dishes, my dishwasher has on-board heating and can work with a cold input. My tankless unit varies its power draw per the input temp, output temp, and flow rate. It may operate at little as 5% of full power or at 85%+ ... so obviously it doesn't always pull 120 amps, but the circuit must be able to supply full power when needed.