Uhhh GN Builders, apparently, you are in an area where there are basements. That just isnt true in a lot of places. There are a few basements in my area, but, they are very few and very hard to find. Most houses in this area, have a foundation the correct depth into the ground, and a house is built on top of that foundation. There are vents in that foundation, and there is an opening, for a door of sorts into that crawl space. Some houses are really crawl, like belly crawl, some you can hunch over and walk under, and some like mine, you can crawl around on you knees, and not have a problem bumping your head, etc. Yes, the water lines are in that crawl space, and so are heating/coolng duct work. Some even have their hot water heater in the crawl space.The height of the crawl space, depends upon the land the house is built on. Some houses have a very high crawl space on one side, and by the time you get to the other side, it is a belly crawl. It is the way houses are built, and I am guessing, you have no experience with them.

How much noise should we expect from a HPWH? - About as much as a fridge What downsides, if any would we experience with a HPWH vented to the conditioned crawlspace? This can work - but know that the air going into the crawl space has to return back to the water heater on the main floor. You have to provide some way for that to happen (a vent, openings, etc) One reason I was initially attracted to a HPWH in the pantry is the cooler/dryer conditions that would result in that space. is that a foolhardy approach? No, it's not. It's fine. Again that air being sent to the crawl space has to circulate back to the water heater. It will cool and dehumidify that area. Also a slightly unrelated question: we have to other hot water "zones" which are ~ 23 ft from the proposed water heater location. Is there a general rule of thumb regarding distance from the heater where electric demand water heater becomes preferred? The answer is complicated. What is the fixture being served, how sensitive is the use to delay in getting hot water? Also, plumbing layout and design matters. So, for example, let's say that one of the uses is the master bath sink. You use the bathroom and wash your hands - you will notice a delay. The fixture will use 1.5 gpm - if you use home run system and use smaller pipe, you will get hot water much faster than if you use a branch system with 3/4" lines. Insulating hot water lines keeps the water warmer between uses also. On the other hand a bath tub, for example, probably doesn't matter. It's moving a lot of water (4 or more GPM) and nobody really cares if it takes a few seconds to get there.

Thank you for your reply. I see that you are also a builder, I hope you don’t mine me asking you some builder related questions. We live in the northern part of SC so the ground is mostly red clay. As I said in my original post, our house was completely destroyed by a fire. We had the house torn down, lot scrapped and cleared. The builder is saying because we chose to build on the same lot the soil make up has changed, meaning the clay may not be as compacted. He says the water is coming in from under the ground from the original footings. The original footings were torn out and new ones were poured. While I can understand his logical what I’m struggling with is, I’m sure we are not the first family to build on an existing lot. Have you experienced anything similar to this? I do wonder if maybe the lot wasn’t graded correctly or if having the tankless water heater and air conditioner outlet pipes on the same side isn’t adding to the problem. That side of the house especially in that flower bed stays very wet (soaking wet). He wants to make sure “there isn’t anything from his build” that is causing the problem, which I appreciate. But even if it is the ground make up, shouldn’t he be expected to fix the problem....even if it requires a sump pump (I believe that will be the case), as the home is just over 6 months old? Also, what’s the potential for this standing water to do other damage...to footings, ground fall (I’m thinking moisture)? I can’t see to the other side of the crawl space, so I don’t know if the problem is on the other side as well. Thanks so much.

Use hydro cement and patch around the pipe if that is where the water coming in. On the general note, it seems like that the entire foundation wall is also problematic and allowing moisture through, not to mention there is dirt in the crawl space. If there is enough room, I would clean that up, put stone and plastic, and cover it with concrete and parge that entire wall. Have a mason contractor come out and make a few suggestions on what can be done to eliminate the existing and future moisture problems which could develop because of that. Good luck