5 Signs Your Water Heater Is Going Bad (And What to Do About It)

Your water heater works quietly in the background—until something goes wrong. The good news? Most water heaters show early warning signs before they fail. Recognizing those signs can help you avoid cold showers, unexpected leaks, and costly water damage. Below are the five most common red flags to watch for, plus what to do if you notice them.  

1. Your Water Heater Is Making Unusual Noises 

If your water heater is rumbling, popping, or cracking during operation, sediment buildup is usually the culprit. In standard tank units, mineral deposits settle at the bottom of the tank, forcing the burner or heating element to work harder to heat the water. Over time, this added strain reduces efficiency, increases energy use, and can eventually cause the tank to overheat or fail. 

Tankless water heaters aren’t immune to noise either. Scale can accumulate inside the heat exchanger, restricting water flow and causing whistling or hissing. Whether it’s a tank or a tankless system, unusual noises shouldn’t be ignored. If left unaddressed, they often lead to performance issues, rising energy bills, or system failure down the line.  

2. Your Water Heater Is Leaking 

Leaks are one of the most obvious signs a water heater is going bad, but they aren’t always catastrophic failures. Some leaks come from loose fittings, a failing temperature and pressure relief (T&P) valve, or condensation. However, pooling water around the tank body itself is a serious concern. It often indicates internal corrosion that has eaten through the metal, and once a tank begins to deteriorate from the inside, replacement becomes the only safe and cost-effective solution. 

Even a small drip can worsen quickly. Since water heaters operate under pressure, a compromised tank may suddenly release more water, leading to significant water damage to your home. Early detection helps prevent structural issues, mold growth, and unexpected system failure.  

3. Your Water Is Discolored or Smelly 

Rusty, muddy, or foul-smelling hot water is another warning sign that your water heater is in trouble. Discoloration—especially brown or reddish water—often points to corrosion inside the tank or a deteriorating anode rod. 

A sulfur-like or “rotten egg” odor may indicate bacterial growth, especially in warm, stagnant areas inside the tank. While some discoloration issues can be resolved with maintenance or a new anode rod, persistent problems usually suggest your water heater is nearing the end of its lifespan.  

4. You’re Getting Less Hot Water Than Usual 

Running out of hot water faster than usual can point to several underlying issues. Heavy sediment buildup may reduce the amount of usable hot water in a tank system, since deposits take up space and force the heating elements to work harder. Faulty thermostats, burned-out heating elements, or damaged dip tubes can also limit hot water supply. 

For tankless systems, reduced output may signal scale buildup or failing components within the heat exchanger. If your household has grown or your hot water usage has changed, your existing system may also simply be undersized for current demand. 

5. Your Energy Bills Are Suddenly Increasing 

A failing water heater often consumes more energy to produce the same amount of hot water. Sediment buildup, aging parts, and worn heating elements decrease efficiency, forcing the system to run longer and more frequently. If you notice a pattern of higher utility bills without changes in usage, your water heater may be to blame. 

Upgrading to an ENERGY STAR^®–certified unit or a heat-pump water heater can restore efficiency and significantly reduce long-term operating costs. It’s also worth checking for available rebate programs in your area, which can help offset the cost of an upgrade.  

Bonus Signs to Watch For 

1. Reduced Water Flow 

If your faucets and showerheads aren’t clogged but your system delivers noticeably less water, the issue often lies inside the unit. Internal scale buildup or a deteriorating heat exchanger can restrict flow and reduce performance. This is one of the earliest signs of tankless failure and should be evaluated promptly.  

2. Loud Compressor Cycling or Vibrations 

Heat-pump water heaters normally operate quietly, so loud cycling, banging, or excessive vibration signals a problem. It may indicate compressor strain, airflow issues, or internal component failure, all of which should be inspected before larger damage occurs.  

What to Do If Your Water Heater Shows These Warning Signs 

Schedule a Professional Evaluation 

If you notice any of the signs above, the safest step is to bring in a licensed plumber. A professional can determine whether your water heater can be repaired or if replacement is the more cost-effective option. To find a qualified local expert, visit Rheem’s Find a Pro directory.  

Consider a High-Efficiency Upgrade 

Newer water heaters offer better performance, lower operating costs, and improved reliability. ENERGY STAR^® models and heat-pump water heaters provide significant long-term savings, and rebates may be available to help reduce upfront costs.  

Keep Up With Annual Maintenance 

Regular inspections help reduce sediment buildup, maintain efficiency, and extend your system’s lifespan. To learn more, browse Rheem’s full library of water heating resources and expert tips.  

When Should I Expect to Replace My Water Heater? 

Most conventional tank water heaters last around 10 years. Once your unit reaches this age, it’s smart to begin planning for replacement rather than waiting for an emergency. If your heater is showing signs like leaks, rust-colored water, inconsistent temperatures, or increased energy bills, replacement is often the most economical solution. 

Rheem recommends beginning replacement planning around year 10 to maintain reliable performance and avoid unexpected issues.  

FAQ 

Q: What is the most common sign that a water heater is going bad? 

A: Unusual noises like popping or rumbling are common early indicators and often point to sediment buildup reducing performance.  

Q: Are leaks always a sign that I need a new water heater? 

A: Not always. Some leaks are caused by loose fittings or valves, but moisture around the tank body typically signals internal corrosion and the need for replacement.  

Q: Why is my hot water discolored or smelly? 

A: Discoloration or odor can indicate a failing anode rod, rust inside the tank, or bacterial growth. A professional inspection will determine the cause.  

Q: What does it mean if I suddenly have less hot water? 

A: Reduced hot water may result from sediment buildup, failing heating elements, or thermostat issues. Older units may simply no longer meet household demand.  

Q: Can a bad water heater increase my energy bills? 

A: Yes. Declining efficiency causes the system to use more energy to heat water. Upgrading to an ENERGY STAR^® or heat pump model can reduce costs.