How Much Does It Really Cost To Replace Your Furnace?
How Much Does a Furnace Replacement Cost?
Updated Fall of 2023
Furnace replacement costs have increased in recent years due to various economic factors. The prices below are meant to give you a sense of what to expect. Contact us for a free estimate if you’re in the Indianapolis area.
One of the most common questions we get is: How much does a furnace replacement cost? While costs vary based on many factors, here are the key considerations that affect furnace replacement pricing.
What’s Your Energy Source?
The first thing to consider is where the energy for your furnace comes. The most common types of furnaces are powered by gas, which range from $3,500 to over $6,000 (depending on efficiency and size). If your home is all electric, you will most likely have a heat pump-air handler combination system. The heat pump is the outdoor system that functions like an A/C during summer, but reverses and is the primary heat source during the winter. The air handler is the indoor part of the system, and will have a backup “emergency” heat source that can be expensive to operate. Heat pump systems can range from $7,500 – $20,000 depending on efficiency and size.
How Efficient are Your Furnace Options?
Furnaces with higher AFUE (annual fuel utilization efficiency) are more efficient but cost more upfront. Higher usage means a faster return on investment through reduced operating costs.
Furnace efficiency is rated by percentage. Standard efficiency systems are rated at 80 percent—meaning 20 percent of the heat generated is lost through the flue. Newer models receive a rating of 90 percent or better, with some reaching 98 percent efficiency—resulting in lower utility costs.
What is the Size of Your Furnace?
Gas furnace heat output is measured in British Thermal Units (BTUs). Units with a higher BTU rating aren’t necessarily better for smaller homes. Oversized units can cycle on and off too frequently, which increases energy costs and reduces comfort. Single gas furnaces typically range from 40,000 to 135,000 BTUs. Homes larger than about 5,000 square feet often use two systems rather than one very large system.
How Much is a New Furnace?
This is completely dependent on the brand of furnace you choose to install, and the HVAC contractor you hire. Furnace installation typically takes most of a workday with a two-person team. Labor cost makes up about half of the overall installation price. Additionally, if the furnace installer finds that you need any repairs on ductwork or other components of your unit, installation costs may run higher.
Four Factors That Affect Installation Cost
1. The Brand
Brand choice depends on your budget and needs. High-end brands increase cost but aren’t always necessary for good long-term performance.
2. Upgraded Features
Most furnaces come with the features needed to heat your home effectively. Additional features may not be necessary depending on your climate and preferences.
3. Location of Furnace
If your furnace is in a difficult spot to reach in your home, the installation time may take longer, which will increase your cost.
4. HVAC Contractor
Research HVAC contractors, speak with them, and get your questions answered before making a decision. This helps ensure you’re working with a contractor you trust.
Important: Get a warranty in writing that specifies what’s covered, the coverage period, and what the contractor will do to address any issues.
Cost Summary
The national range for furnace installation is $2,500 – $6,000, though this varies based on the factors listed above. Research is important when preparing to replace your furnace. Resources like Home Advisor provide average costs by zip code.
For more information on furnace replacement costs in the Indianapolis area, give us a call at 317-203-8149.
Posted in: Heating, HVAC Indianapolis
