I use a hydronic air handler with a tankless gas water heater. It is 96% thermally efficient and handles both space heating and water heating with one appliance.
I did it myself, including a whole house electrostatic precipitator and all new PEX plumbing for under $4000.
If I could do it again, though, I would stay away from BRANCH plumbing using PEX manifolds, and would instead do a parallel loop circuit, so that a on-demand hot water reciculator could be used effectively. Right now I have a hot water recirculator that delivers hot water to the "master" bathroom sink on the press of a button, but because I used manifolds, it ONLY provides instant hot water to the sink, not to the other 6 branches of my plumbing system (unless I also install bypass check valves and wiring to each of those branches as well)
Another good thing about tankless heaters is that, if you wanted to use solar, it would still work. In that case, the tankless heater only heats the stored hot water up to your desired temperature if it isn't yet hot
enough from the sun. So, no cold water on cloudy days. The two things may not be able to work together, though, the hydronic air handler and solar... Because the air handler needs water at 160 degrees F to meet its RATED BTU output. Of course, you could just oversize the handler and use cooler 120 degree water for the same BTU output.