I love 'em. I recently switched to a tankless water heater myself. It seems that the rest of the world has been using these forever...and us Americans are just catching on.
By and large, tank-less or instant water heaters are more energy efficient compared to the regular kind since they don't have to heat and reheat the water in the tank. However, depending on the plumbing in your dwelling, it may take a minute for the water to heat and pup through to the faucet...so it may also result in a lot of water waste as you have to let the cold water run until the hot water makes its way to you.
Also, buying the right capacity can be tricky...if you don't buy a large enough model, it may not be able to heat and pump enough hot water to satisfy the usage in your household...so make sure you do research and buy for the number of people in your house.
Check out this website for more info: http://www.tanklesswaterheaterguide.com/
and also http://en.wikipedia.org/wiki/Tankless_w ... ss_heaters
My favorite manufacturers are Rheem and Bosch.