Considering installing a tankless, gas water heater system and underfloor heating--any experience with this?

We have an area to heat an a-frame which is approximately 750 sq feet. It will have to support one full bathroom and one guest bathroom as well as an apartment size clothes washer and a kitchen with hot water.
Though these tankless systems are very efficient and all over Europe, they are quite uncommon in the US. Are there problems or is it just that the initial cash outlay is considerably higher?

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