All homes have some sort of water heating system whether its gas, electric, or tankless. Most standard water heaters have an average life span of anywhere from 12-15 years, give or take.

How to tell when it is time for a replacement:
lack of hot water
leaking water heater
rust-colored water

Gas water heaters
These operate via natural gas or in some cases propane. They use a burner to heat up the tank of water to an adjustable temperature, usually no more than 125 degrees. Gas water heaters have a fast recovery rate, meaning that once all the hot water from the tank is depleted, they can quickly heat up a full tank again, allowing for multiple fixtures to be used at once shower, dishwasher, etc. . Gas water heaters produce combustion, so they have a vent at the top to channel all spent hot gases away from the unit itself.

Electric Water Heaters
These function by using two thermostats located on the side of the tank to heat up two elements within the tank. These elements get red hot, heating all the water inside. The thermostats are adjustable to 125 degrees in most cases. Electric water heaters do not require a vent, so they can be installed in a wider variety of spaces. However, they have a slower recovery rate than gas water heaters.

Both systems will function in any home built for them, and have roughly the same life span. All sizes are available, from small, 10-gallon units to large scale 100-gallon units and everything in between.

Tankless water heaters
They are relatively new concept to the U.S., having been popular in Japan and Europe for years. These are very small area, averaging about the size of a small suitcase, and are wall-mountable. On most units they use a combination of gas and electricity to operate, and are much more efficient than standard water heaters. They operate cleanly and quietly, and require little to no maintenance. They can be installed inside or outside, and as such, have different venting requirements than tank-type heaters. Also, they are available with an optional wall-mounted keypad to adjust temperature. There average life span is 25 years.