This paper presents a multi-criteria optimization formulation for the optimal design of a water-heating system for homes. The proposed model accounts for the available solar radiation in the specific place where the solar collector is installed and the hot water demands. The goal is to target economic and environmental objectives by optimizing the design and operating conditions including the optimal hot water storage and distribution. The proposed model is applied to several scenarios for homes with different inhabitants and in various cities in Mexico. The results show that the location has significant effects on the optimal design and operation of the water-heating solar system.