Furnace Replacement Cost

Low

$720

High

$3600

How much does Furnace Replacement Cost cost?

Replacing an old furnace costs between $2,000 and $6,000 based on a national average. Things like the type of furnace (electric, gas or oil), how efficient the unit is and the brand name impact not only the furnace price itself, but the installation cost, too.

What's in this cost guide?

#cost_factors'>What affects the cost of furnace replacement?
#furnace_cost'>How much does a new furnace cost?
#Installation_cost'>How much does it cost to install a new furnace?
#furnace_upgrades'>Which furnace upgrades are worth it?
#warranties'>What about warranties?
#replacement_needs'>Do I really need to replace my furnace?
#spend'>How much should I spend on a new furnace?

What affects the cost of furnace replacement?

The cost to replace your furnace is determined by two things: the price of the furnace and the labor to install it. We'll cover labor in a bit. For now, let's look at furnace prices.

One of the main drivers of price is the furnace's efficiency rating, which is a percentage that tells you how well the unit converts fuel into heat. When shopping for a new furnace, look for the Annual Fuel Utilization Efficiency (AFUE). Most modern units have an efficiency rating between 85% and 95%. The higher the percentage, the better and the more it will cost you. Rule of thumb: If you're going to be in your home for less than 5 years, an AFUE of 80% is good. In that short amount of time, you likely wouldn't recoup the costs of a more expensive unit. If you plan to stay in your home long term or want to improve resale value, get one that's 95%.

The brand of your furnace also has a big impact on replacement costs. And while all manufacturers claim to have their own distinctive features, for the most part, they're pretty equal in terms of function. And any modern furnace will be far more efficient than whatever 20-year-old unit you're replacing.

Natural gas is currently the most common heating fuel (most new central heating systems use gas), so let's look at how the gas furnace manufacturers compare.

Brand	Pros and cons	Average unit price (nationally)
American Standard	Founded in 1929, American Standard is a (slightly) more affordable alternative to their flagship brand, Trane. Both brands offer a similar line of products.	About $3,000
Bryant	Bryant is a subsidiary of the more premium brand, Carrier. It's known for having the same high quality as Carrier, at a lower price point.	About $2,300
Carrier	One of the top-selling brands in the industry, Carrier furnaces are more expensive than many furnaces with comparable performance specifications.	About $2,800
Lennox	Lennox has pretty high purchase and installation costs, as well as high maintenance costs over time due to the fact that all their parts are proprietary. Because of the generally higher cost of proprietary parts, it may be worth getting an extended warranty with labor fees included.	About $2,500
Rheem	One of the fastest growing furnace brands in the U.S., Rheem units have a patented heat exchanger that improves air flow and reduces noise.	About $2,300
Trane	Trane is a premium brand with a big price tag. If you're planning to stay in your home less than 5 to 7 years, the brand may not be worth the investment.	About $3,000

How much does a new furnace cost?

The three most common furnace types are gas, electric and oil. When buying a replacement unit, it's fairly common for homeowners to stick with whichever fuel type they currently have. That said, there are benefits and drawbacks to all three.

Gas furnaces are more expensive than electric and have higher installation costs up front. But they save you money on energy bills down the road because the fuel used to power them is cheaper. Electric furnaces are more expensive to run, but have a higher efficiency rating and do a better job of heating your home. Oil furnaces are another option. They have fewer emissions than gas furnaces and there's no threat of carbon monoxide. But they require the most maintenance and have the lowest efficiency rating.

Here's a breakdown of furnace costs and benefits.

Type of furnace	Efficiency rating	Pros and cons	Furnace price
Oil Furnace	80-90%	Fewer emissions than gas furnaces. No threat of carbon monoxide. Heats large spaces evenly. Higher fuel prices than natural gas. Requires an on-site storage tank for fuel. Requires oil delivery service. Lowest efficiency rating. Lifespan 15 to 20 years.	$1,000 to $3,000
Gas Furnace	89-98%	More efficient than an oil furnace. Less efficient than electric. Lowest fuel costs; least expensive to run. High upfront costs to purchase and install. Risk of carbon monoxide. Needs ongoing more maintenance. Lifespan 15 to 20 years.	$900 to $3,000
Electric Furnace	95-100%	Lowest purchase price. Easy (and cheap) to install compared to a complicated gas furnace. Minimal, straightforward maintenance. Highest fuel costs; most expensive to run. Longest lifespan, 20 to 30 years.	$700 to $1,100

How much does it cost to install a new furnace?

On average, contractors charge around $75/hour nationwide, and typically it takes about a full working day to install a new furnace. That quoted rate may be higher if your current furnace is difficult to get to, extensive ductwork is needed for your new heating system, or if the new furnace is a different size and shape than your existing unit. Labor costs make up about half the price of your total installation cost.

Which furnace upgrades are worth it?

You obviously want your new heating system to run as efficiently as possible, so it makes sense to splurge on the highest efficiency rating money can buy, right? Not exactly. If your current furnace is more than 15 years old, it's probably only running at about 60% efficiency. So any new unit is going to save you money on energy bills and do a better job of heating your home.

You don't necessarily need a brand new electric furnace running at 100% efficiency to get the biggest bang for your buck. Here's a breakdown of furnace features that can drive up the price of a new unit. As with any appliance, the more bells and whistles, the more expensive it gets.

Single-stage vs. two-stage operation: Single-stage furnaces have only one setting: full blast. They use full fuel all the time, no matter the temperature outside. Two-stage furnaces change their output depending on how cold it is. In freezing temperatures they run at full capacity, two stages. If it's a little chilly out, they'll just run one stage, saving you fuel and money. The price difference between the two operating systems is a few hundred dollars. It's money well spent, if your budget allows it. Two-stage furnaces do a better job of removing cold spots and save you more money in heating costs.

Variable speed vs. non-variable speed: Standard furnace blowers usually have four (non-variable) speeds: low, medium-low, medium-high, high. In variable units, the blower will speed up or slow down based on the load on the home and the outside temperature, making them much more cost-effective. Variable units cost anywhere from $500 to $800 more than a non-variable unit. It's a nice upgrade, but certainly not a necessary one.

Ductwork: If you need ductwork on top of your furnace installation, it adds a few more days of labor and an extra $2,000 to $3,000 nationally. You don't always have to replace ductwork when you buy a new furnace but if yours is very old, you should have it looked at. The high efficiency rating on your fancy new furnace won't do you much good if your ductwork is in poor shape. An HVAC contractor can perform duct testing to find leaks and give you an estimate of what it will cost to repair or replace.

What about warranties?

There are two types of warranties related to your furnace: the manufacturer's warranty and the installation company's. The manufacturer's warranty covers any issues with furnace itself. Your contractor's warranty covers the labor involved to make repairs if the furnace doesn't work properly. If your HVAC contractor offers a warranty (a reputable one will!) be sure to get it in writing, specifying what exactly is covered and for how many years.

Do I really need to replace my furnace?

The expected life span of a forced-air furnace is between 15 and 20 years. Furnace repair can cost almost as much as buying a brand new one, so if your unit is nearing the end of its expected life, experts recommend you don't spend more than a third of the replacement cost to repair it.

Don't know how old your furnace is? Find the model and serial number and call the manufacturer. They can tell you how old it is and how much a replacement unit might cost.

How much should I spend on a new furnace?

Have an contractor perform a load test to determine which size furnace is recommended for your home so you don't waste money on features you may not need.

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