Most houses have a line going from the heater to the tap, not a loop, so the water just sits in the pipe waiting for pressure behind it to push it out of the tap. The cold water in the pipes can’t be recirculated. I suppose you could plumb a loop through the whole house and constantly rerun the cooling water through the heater but that kind of defeats the energy savings from a tankless heater. That loop becomes a really long skinny tank that’s right next to all of your taps.