Tankless water heater were always much more economical than tanked systems.
I know that because I have a modern unit in my apartment, only to fill my washers.
it uses more gas than a tank burner, but it turns on only when you open the tap and heats only what you need.
You'll also never run out of hot water.
My heater costed around $200 and the installation was so simple that I did it myself.
Of course, there are bigger models, costing up to 900 dollars.
Simple, reliable, economical, very small (saves lots of space as I have it on the wall, above the laundry sink), cheap and fully manteinance free...
I simply love them!