Those that have, typically fail due to a manufacturing defect and are replaced.You also mentioned your water is hard, which is more incentive to use a better heaterI with a better tank and components.  

The title is now recorded with a defect and the bank says they are not going to fix it because they found some title company that will insure it.

If the selling agent is someone who thinks like that, and puts their needs in front of their clients needs...then they are also likely to be an accomplished liar, who will steer the deal towards you, but they will also make sure you are doing something stupid in the process like over bidding, or hiding defects in the home from you.

the other risk is HOA litigation on construction defects.. its financial suicide for the owners and they don't realize it when some HOA sue happy lawyer talks them into some big suit. seen that show a few times.

Even if you did find that home, no listing broker would ever sign a form stating there are no code violations either (as they do not have the expertise to make this guarantee and would have no ability to detect latent defects).

An open permit, in Florida anyway, is not considered a title defect. 

Any defective valves, etc need to be replaced regardless of the boiler.

Your's has a defect vs. the comps.  

They will trip over their shoelaces running to play "Bend over Betty" for anyone with a fancier hat.Look at how Cadillac gets narcissists to part with their money.In reality, the narcissist is a defect.

Is there any latent defects he may not be telling you?