[wolvesechoes]

I don't know about US, but it is not a novelty in Europe to use heat pump to prepare hot water and cool the air in a house at the same time. It is just that such designs are much more expensive than simple AC units or air-to-air heat pumps.

[argiopetech]

At least from my perspective in the US South, this is non-existent. Hot water is heated with resistive heating elements and stored in an (under-) insulated cylinder until needed, accounting for as much as 30% of monthly household energy use.

On-demand systems (gas and electric) are available, but I've not personally been in a house where they were used for other than quality of life (i.e., providing hot water sooner than and until the water can get from the hot water heater).

[OptionOfT]

I actually have one of these on-demand hot water systems at home, on gas, as it is much more powerful than an electric one.

What really bothers me is that you always read that they are instant.

The fact that they are instant is not because they don't have storage, it is because they are smaller and thus could be placed much closer to where you need the heat. The problem is that everybody who replaces their hot-water tank puts that 'instant' (I prefer the term on-demand) water heater in that place.

The following is anecdotal, I promise you, I'm not lying, but again, N=1.

We have one that we unlocked to go up to 140F (default 120F for protection).

I live in North Phoenix, bordering the desert, so it gets to around 32F (8 hard freezes last winter).

The capacity of our hot water heater, which is already high, as they really work hard, isn't enough to heat up city water fast enough to get water that is the temperature I like, in winter. Remember that thing needs to heat up water from say 40F to 140F. And while it can do that, it cannot do it at the same pressure as the previous one with a tank. It'll literally reduce pressure if it cannot reach the right temperature, which is really annoying, as that makes the overall temperature go down.

The previous one with the tank was 140F, got refilled with 40F, but could deliver me a much more continuous pressure for much longer.

[throwway120385]

I have a hydronic heating system in one of my houses, but the electrical service can't provide enough amperage to heat the water up, so it's running on propane. Unless you're willing to spring for an upgrade to a 300A service, usually you'll have some combination of gas for heat or for water heating or for clothes drying. There are electric versions of all of these but you don't normally have enough budget on a 200A service to run them all at the same time because you also have to have budget for a lot of 120VAC kitchen and garage appliances. Houses built 20 years ago also had weird circuit configurations to accommodate separate lighting and power circuits because incandescent bulbs were so inefficient. So you'll have a bunch of lighting circuits that are only pulling an amp or two and then a bunch of appliance circuits that are pulling 10's of amps, but your panel gets filled up because of the unnecessary lighting circuits.

At least, in my experience this is how it goes as a homeowner.

So to get to an on-demand water heater you'll probably have a lot of electrical work that needs to be done(potentially thousands of dollars).