How Much Does Furnace Replacement Cost?

Last Updated on September 9, 2024
Written by CPA Alec Pow | Content Reviewed by CFA Alexander Popinker

As the central heating engine powering a home’s climate system, furnaces operate continuously through seasons of variable weather. But after an average of 15-20 years, most residential furnaces reach the end of their functional lifespan and require replacement. What should homeowners expect to budget for a new heating unit and professional installation?

This guide thoroughly examines pricing ranges, efficiency comparisons, brand differences, installation considerations, expected lifespans, and tips from trusted HVAC specialists to provide the comprehensive details needed to maximize value from this vital home system investment.

How Much Does Furnace Replacement Cost?

With all factors considered, total furnace replacement project costs typically range $4,000 to $12,000+ depending on the unit, features, installation complexity, and additional services necessary for optimal efficiency and performance.

When all necessary components, labor, and services are factored together, homeowners can expect to budget the following average overall investment ranges for a complete furnace replacement project:

• Gas or Electric Furnace Unit – $2,000 to $4,500 for the heating unit itself depending on model, features, and output size.
• Oil Furnace Unit – $4,000 to $8,000 for an oil burning furnace and tank removal.
• Professional Installation Labor – $2,000 to $4,000 for contractor fees to safely install the new equipment.
• Ancillary Services – $1,000 to $3,000 for any ductwork, venting modifications, wiring upgrades or permitted alterations to optimize new furnace function.
• Total Turnkey Installation Budget – $4,000 to $12,000+ when all necessary equipment, labor, and services are combined for a top to bottom heating system replacement.

Higher efficiency models, more complex installations involving structural modifications, and any repairs or upgrades needed in conjunction with the project can push overall budgets above these general cost averages. Securing 3-5 competitive fixed price quotes from local licensed contractors allows homeowners to compare pricing fairly on equivalent project scopes.

Standard vs High-Efficiency

When selecting a replacement furnace, one of the biggest considerations is whether to invest extra upfront cost into a higher efficiency model for improved energy savings over time. Below outlines key trade-offs to weigh:

Furnace Type	Average Cost	Efficiency Rating	Annual Energy Savings
Standard 80% AFUE	$3,000 to $6,500	80-85% AFUE	Baseline
High-Efficiency 92-98% AFUE	$4,500 to $10,000+	Up to 98% AFUE	15-30%+

According to Atlas AC Repair, the cost for a new furnace installation typically ranges from $2,930 to $5,430. This estimate includes various components such as equipment, labor, and miscellaneous materials. For instance, the removal and installation of a furnace can cost between $1,400 and $2,300, while the installation of an evaporator coil may add an additional $500 to $700.

Gee! Heating & Air provides a detailed breakdown of costs based on the fuel source. They report that replacing an electric furnace can cost between $2,500 and $4,500, while gas furnaces typically range from $3,500 to $10,000, with an average around $7,000. Propane furnaces fall between these ranges, costing around $2,500 to $7,500. The site emphasizes that the fuel type significantly impacts overall costs.

According to Quality Comfort, a new furnace generally costs between $3,000 and $7,000. The total cost is influenced by factors such as the size of the furnace, efficiency ratings, and whether the installation company offers competitive pricing. They also note that higher efficiency models, which can have an AFUE rating of 90% or higher, may come with a higher initial cost but lead to savings in the long run.

Homesense states that the national average for furnace installation is between $2,500 and $6,000, depending on the efficiency and size of the unit. They highlight that gas furnaces typically range from $3,500 to over $6,000, while heat pump systems can cost significantly more, ranging from $7,500 to $20,000. This reflects the complexity and efficiency of the installation.

Lastly, Airling HVAC mentions that the average cost for furnace replacement is around $4,700, with typical installation costs ranging from $2,800 to $6,800. They explain that the size of the furnace and the type of fuel used are crucial factors in determining the final cost. For example, a furnace suitable for a larger home may cost closer to the higher end of the range.

Weigh projected energy savings against higher equipment costs and feature requirements in your specific climate zone and household energy usage needs. Extended warranties, energy rebates, and tax incentives can help offset the initial investment in a high-efficiency model. A 5-7 year payback period through monthly energy savings is typical for households that heat regularly.

Residential Furnace Replacements

The central furnace is the hardworking engine that powers a home’s indoor climate comfort system, continuously circulating warmed air through ductwork to maintain set temperatures in interior living spaces during heating seasons.

After providing approximately 15-20 years of reliable operation, most residential furnaces reach the end point of their functional lifespan and require proactive replacement to avoid unexpected breakdowns, comfort issues, and spiraling repair costs. Savvy homeowners who invest wisely in new furnace installations stand to gain:

• Greatly enhanced home energy efficiency and temperature consistency from advanced technologies.
• Reduced monthly utility bills and electrical load, saving potentially hundreds of dollars annually from improved efficiency capabilities.
• Minimized repair costs and discomfort by preempting problems before catastrophic furnace failures occur.
• Peace of mind from comprehensive 10-15 year manufacturer warranties on new unit components.
• Precision temperature control and energy optimization through integrated smart thermostat management features.

When timed properly and budgeted for in advance, proactive furnace replacement maintains ideal home comfort while preventing costly emergencies down the road.

Factors Affecting Furnace Replacement Costs

• Furnace Type and Output BTU Rating – Standard efficiency gas or electric units are generally more budget friendly. Upgraded variable speed high-efficiency models with modulating heat control provide the greatest energy savings but cost more upfront. Required output heating capacity depends on home size, insulation, and climate zone.
• Ductwork System Repairs or Modifications – Optimizing airflow efficiency often necessitates improving existing ducts, vents, returns which adds expenses for materials, labor, sealing.
• Added Features and Accessory Upgrades – Components like thermostats, humidifiers, high-end air filters, venting, electrical upgrades customize performance and influence cost.
• Installation Complexity – Straightforward swaps add minimal labor costs versus extensive replacements involving duct rerouting, venting changes, gas line extensions or electrical work which can add thousands to the bottom line price.
• Furnace Brand, Warranty, and Specific Model – Pricing can range widely across manufacturers and models made with differing materials, technology, energy ratings, and warranty terms. Comparison shopping is very important.

You might also like our articles about the cost of a propane furnace, furnace ignitor replacement, or gas fireplace maintenance.

Additional Services

• Ductwork System Improvements – $500 to $2,000+ for repairs, sealing, rerouting, insulation.
• Smart WiFi Thermostat Integration – $200 to $500 for control integration and optimization.
• Whole Home Humidifier – $400 to $1,000 to offset dryness during winter months.
• High-End Media Air Filter Upgrades – $100 to $500 to screen allergens and pollutants.
• Venting Improvements – $200 to $1,000 if materials, routing, or termination require modifications.
• Electrical and Gas Line Work – $200 to $1,000 if power, grounding, or gas pipes need alterations to meet equipment requirements.

Anticipate an extra 20-40% in potential costs above the base furnace unit price to handle necessary accessories or site conditions the new system requires for safe and ideal performance.

Warranties and Lifespans

When making such a major home investment, carefully examining warranties as well as realistic equipment lifespan expectations is advised:

• Manufacturer Parts Warranty – Typically 10-20 years. Covers defects in original materials and workmanship only.
• Optional Labor Warranties – For $100-300 more, provide added peace of mind by covering repair labor costs for 1-5 years.
• Average Furnace Lifespan – 15-20 years for new units when properly maintained. Heat exchangers may last 10-15 years before major repairs needed. Don’t expect 30+ years of like-new performance.
• Annual Maintenance – $75 to $200 allows professional tune-ups to maximize lifespan. DIY care saves but requires expertise.

Review all warranty terms closely including exclusions and limitations before committing. Proper maintenance is key to achieving maximum potential from a furnace replacement.

Furnace Brands and Models

When selecting a replacement furnace, most homeowners narrow options to a few of the major national brands below:

Carrier – Often considered top tier for proven reliability, performance capabilities, and leading technologies but comes at a higher price point.

Trane – Excellent brand reputation backed by great warranties, competitive pricing, and good technical support makes this a sound mid-range investment.

Lennox – Leading efficiency innovations ideal for cold and mixed climates to substantially reduce energy costs over time.

Goodman – Budget-minded basic models still offer decent value for cost-conscious buyers willing to sacrifice some premium features for pricing.

Rheem – Mid-range brand competitively priced with proprietary features ideal for milder climates.

Carefully calculating the right size output, comparing features, warranties, expected lifespans, and matching the optimal replacement for your household needs and budget determines satisfaction long-term.

Expert Insights

Mark Johnston, HVAC Equipment Reviewer at CoolHomeGuide.com:

“When weighing furnace brands, look closely at warranties – longer coverage for parts and labor ensures your major investment is well-protected long term.”

Samantha Lee, Senior Editor at HVACHomeTips.com:

“Carefully compare furnace sizing output recommendations between contractors. Oversized units cost more upfront and operate less efficiently over time.”

James Smith, Veteran Furnace Technician:

“If your existing ductwork is old or insufficient, be prepared for potentially expensive modifications required to maximize performance of a new high-efficiency furnace.”

Michael Evans, Owner of Evans Heating and Cooling:

“Focus on value over lowest bid when selecting a qualified installation contractor – a poorly installed furnace will struggle to reach expected lifespan and efficiency projections.”

Sarah Davis, EnergyWiseHomes.com:

“Check current utility rebates – high-efficiency furnace replacements can qualify for $500+ which helps offset higher equipment costs through long-term savings.”

Andrew Kim, Home Improvement Expert:

“Review warranty terms closely – registration within 30 days, maintenance records, and using same-brand parts can be required to avoid voiding coverage.”

Final Words

In summary, replacing an aging or underperforming residential furnace represents a major home system investment, often ranging anywhere from $4,000 to well over $12,000 when all necessary components, customization, installation variables, and ancillary services are factored together.

While certainly no small outlay, when intelligently researched and budgeted for, a replacement furnace selected prudently to match your household can provide reliable, comfortable heating for a decade and peacefully pay dividends through significantly lower utility costs and reduced repair expenses over its lifespan.

Taking time to understand all the available replacement options allows homeowners to make informed furnace equipment decisions delivering savings and satisfaction for many future years inside the home.

Answers to Common Questions

Is it worth it to replace a furnace?

Yes, at about 15 years old it is generally recommended to replace instead of repairing very outdated furnaces. Newer models offer substantially improved temperature control, efficiency, lower energy bills, and fewer breakdowns.

What is most expensive part to replace in a furnace?

The heat exchanger, which directs air flow across the heat source, is often the costliest furnace component to replace, ranging from $1,500 to $3,000 including labor.

What is the life expectancy of a furnace?

The average lifespan of a new gas furnace is 15-20 years. Electric furnaces last 10-15 years on average. With diligent annual maintenance, furnaces can achieve lifespans at the higher ends of those ranges.