The following are general safety and installation requirements for a tankless gas water heater.
Tankless heaters potentially can explode and cause significant damage, injury, or death if certain safety devices are not installed. A safety device called a pressure relief valve, is normally attached to the hot water side of tankless heaters to dump water if the temperature or pressure becomes too high. If a gas tankless water heater is installed in a garage or basement, many plumbing codes require that it be elevated at least 18 in (46 cm) above the floor to reduce the potential for fire or explosion due to spillage or leakage of combustible Gas fired tankless water heaters should not be located in sleeping areas.
Tankless heater controls are generally set to 120° F or less to help prevent accidental scalding.

Recovery Rate
Gas fired tankless water heaters do not produce hot water until a tap is turned on and hot water is called for.