Air Conditioner Cost: Installation or Replacement

By: Brian Schutt  |  March 11, 2021

Indianapolis summers get unbearable very quickly. You know the 90+ degree days where by the afternoon you have sweat the back out of your shirt multiple times. I’m a firm believer that most people would have long moved out of central Indiana if central AC’s didn’t exist. But sadly, most folks take air conditioners for granted until they’re not working right. And when they aren’t working right, many homeowners make dubious decisions based on desperation, not research and comparison shopping. As is always our goal at Homesense, we want to have home owners armed with the right information so that they can make the best decisions for their home that maximizes value. An important first step toward that end is to have a good grasp on air conditioner cost.

So what should these units cost when it gets down to it?


There is a great range of pricing when estimating an air conditioner cost. The three primary variables are:

  1. Brand
  2. Efficiency
  3. Size


We are a Daikin dealer, so we always include that brand within our proposals. Daikin is the world’s largest manufacturer of air conditioning equipment, with a slate of brands to fit any customer’s needs. With their years of industry experience and innovation, you can trust that you are getting the best product possible with Daikin. In our estimates, you’ll see two Daikin brands: Goodman and Daikin. If you are looking at a mini-split unit, we may also offer Mitsubishi. These varied brands will also bring varied prices. Your choice will have more to do with the quality you are looking for and the length of time you foresee being in your current home.


When it come to efficiency, air conditioner cost is fairly straightforward: the greater the efficiency, the higher the price. Based upon the air conditioning systems we replace in Indianapolis, we usually see an increase in efficiency with a new unit. One of the main reasons that is the case is because the EPA has increased the minimum efficiencies that manufacturers can make. The current minimum efficiency in Indiana is 13 SEER (Seasonal Energy Efficiency Ratio) for air conditioners and 14 SEER for heat pumps. For each SEER increase we estimate that home owners see a 6% increase in operating efficiency. With systems that increase up above 20 SEER, prices can nearly double from the 13 SEER options. What we often do for home owners is help estimate the cost vs. benefit of additional SEER. Then they can estimate where the additional efficiency will have a financial benefit.


For system sizing, we recommend a load calculation be done on your home. A load calculation takes into account variables like square footage, windows, insulation, among other factors. This determines what amount of cooling capacity is needed to maintain a comfortable temperature. In sizing a system, bigger is not better. Correct sizing is better. This is an area where a quality, experienced contractor should give you direction on the best size for your home. If you believe your current system is undersized, you might be correct. But many times, a lack of comfort has more to do with duct design and insulation.

Air Conditioner Cost Ranges

Using the above variables, below is a range based upon a normal installation with many bells and whistles:

2 ton 13 SEER Air Conditioner & Coil including labor, taxes, warranty:

$3,000 – $4,000

3 ton, 15 SEER Air Conditioner & Coil including labor, taxes, warranty:

$4,500 – $6,000

5 ton, 19 SEER Air Conditioner & Coil, including labor, taxes, warranty:

$10,000 – $12,000

Clearly, every home has unique variables that require different material and labor to accomplish a quality air conditioning installation. Hopefully this helps in your selection of the right vendor for your work. If we can help in any way, or you’d like to get an ac repair cost estimate from us, call or text us at 317-203-8149.

Posted in: Air Conditioning

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