How Much Does a New Furnace and AC Unit Cost Installed

Replacing heating and cooling equipment involves significant investment and planning. This article breaks down the costs, factors, financing options, and tips to estimate how much a new furnace and AC unit installed will cost for typical U.S. homes. Readers will find realistic price ranges, key decision points, and strategies to reduce overall expense.

Component	Typical Installed Cost Range	Notes
Furnace (Gas, Mid-Efficiency)	$2,000 – $4,500	Depends on AFUE, size, and venting
Furnace (High-Efficiency)	$3,500 – $7,500	Includes condensing furnaces, may need PVC venting
Central AC (Single-Stage)	$3,000 – $6,000	Price varies by SEER rating and tonnage
Heat Pump System	$4,000 – $10,000	Includes ducted ductless options; provides heating and cooling
Full HVAC Replace (Furnace + AC)	$6,000 – $15,000+	Depends on equipment quality and ductwork

How Costs Break Down: Equipment, Labor, And Extras

Installed cost equals equipment price plus labor, permits, disposal, and possible modifications. Equipment is driven by brand, efficiency rating, and capacity. Labor depends on local market and installation complexity. Extras include permit fees, thermostat upgrades, duct sealing, condensate pump, and line set or venting changes.

Equipment often represents 40–60% of the total installed price. High-efficiency furnaces and variable-speed compressors typically add upfront cost but can lower operating expenses. A simple like-for-like replacement is less expensive than converting fuel types or upgrading duct systems.

Typical Price Ranges For Furnaces

Furnace prices vary by fuel type, capacity, and efficiency. Here are common ranges for installed furnaces in the U.S.

• Standard Efficiency Gas Furnace (80–90% AFUE): $2,000–$4,500 Installed.
• High-Efficiency Gas Furnace (95%+ AFUE): $3,500–$7,500 Installed.
• Electric Furnace: $1,500–$4,000 Installed; attractive where gas isn’t available but higher operating costs.
• Oil Furnace: $3,000–$6,000 Installed; regional pricing varies in Northeast and rural areas.

Capacity matters: undersized furnaces underperform; oversized units cycle frequently and waste energy. Proper sizing via a Manual J load calculation is critical and may add $100–$300 but prevents costly mistakes.

Typical Price Ranges For Air Conditioners And Heat Pumps

Cooling equipment cost depends on tonnage, SEER rating, and whether the system is a conventional split AC or a heat pump.

• Central AC (2–5 Ton, 13–16 SEER): $3,000–$6,000 Installed.
• High-Efficiency AC (16–20+ SEER): $5,000–$9,000 Installed.
• Air-Source Heat Pump: $4,000–$10,000 Installed; provides both heating and cooling.
• Ductless Mini-Split: $2,500–$8,000+ per zone; multi-zone systems cost more.

Upgrading to a higher SEER model increases initial cost but yields lower energy bills. Incentives and rebates can offset part of the premium for heat pumps and high-SEER units.

Factors That Increase Installation Cost

Several common conditions drive installed costs upward. Homeowners should evaluate these before signing a contract.

• Ductwork Repairs Or Replacement: Poor or leaking ducts often add $1,000–$5,000 or more.
• Changing Fuel Type: Converting from electric to gas or vice versa requires additional equipment and permits.
• Complex Installations: Multi-story homes, tight spaces, or roof or masonry work increases labor time and cost.
• High Efficiency Or Specialty Equipment: Variable-speed compressors, modulating furnaces, and geothermal systems are pricier.
• Permits And Inspections: Local fees and required inspections can add several hundred dollars.

How Location And Season Affect Price

Installed prices vary widely by region and season. Labor rates are higher in coastal and metropolitan areas, and supply chain constraints can increase equipment prices.

Seasonal demand matters: HVAC contractors are busiest in summer and winter peaks, raising lead times and sometimes pricing. Spring and fall often offer better scheduling and promotional pricing.

How To Get Accurate Estimates: Shop Smart

To determine how much a new furnace and AC unit installed will cost, follow a structured approach to get accurate bids.

1. Obtain At Least Three Written Estimates From Licensed Contractors.
2. Request Detailed Breakdowns For Equipment, Labor, Permits, And Extras.
3. Ask For Manual J Load Calculations And Duct Assessments.
4. Compare Warranties, Installation Practices, And References.

Beware of unusually low bids that omit critical steps like proper sizing, permitting, or condensate management. A lower upfront price can lead to higher operating costs and premature failures.

Incentives, Rebates, And Tax Credits

Federal, state, and utility incentives significantly reduce net costs for high-efficiency equipment and heat pumps. The U.S. federal government and many states offer tax credits or rebates for qualified systems.

Key steps: check the Database of State Incentives for Renewables & Efficiency (DSIRE), review local utility rebate programs, and confirm manufacturer and contractor requirements before purchase. Some incentives require pre-approval or installation by certified contractors.

Financing Options And Cost Spreading

Many homeowners finance HVAC replacements. Options include home equity loans, personal loans, credit cards, contractor financing, and energy-efficiency loan programs.

Contractor financing often includes promotional rates or deferred interest but requires careful review of terms. Energy-efficient mortgages and PACE programs can attach payments to the property tax bill in some jurisdictions.

How To Reduce Total Installed Cost Without Sacrificing Quality

Several strategies lower cost while maintaining system performance.

• Opt For Mid-Range Efficiency If Payback Is Long: Balance equipment cost with expected energy savings.
• Bundle Work: Replacing both furnace and AC at once can reduce labor costs.
• Request Rebates Upfront: Factor incentives into bids to compare net costs accurately.
• Improve Existing Ductwork: Sealing and insulating ducts can enhance efficiency at modest cost compared to full replacement.
• Schedule During Off-Peak Seasons: Spring and fall often yield better pricing and availability.

Comparing Replacement Scenarios: Sample Cost Estimates

Examples illustrate how variables change final prices.

Scenario	Equipment	Estimated Installed Cost
Basic Replacement	80% AFUE Furnace + 13 SEER AC, Same Ducts	$5,000–$8,000
High-Efficiency Upgrade	95% AFUE Furnace + 18 SEER AC, Minor Ductwork	$9,000–$14,000
Heat Pump Conversion	Air-Source Heat Pump Replacing Furnace+AC	$6,000–$12,000
Full System With Duct Replacement	New Furnace + AC + Ducts	$10,000–$20,000+

Questions To Ask Prospective Contractors

Asking the right questions uncovers value and avoids surprises.

• Will The Contractor Perform A Manual J Load Calculation?
• Are Permits And Inspections Included In The Estimate?
• What Are The Warranty Terms For Equipment And Labor?
• Is The Installation Team Employed Or Subcontracted?
• Are Rebates And Incentives Included Or Handled By The Contractor?

Documenting answers in writing and comparing them across bids clarifies true value beyond sticker price.

Maintenance Costs And Lifespan Considerations

Initial cost is only part of lifetime expense. Annual maintenance, filter replacement, and occasional repairs affect total ownership cost.

Typical lifespans: furnaces 15–20 years, central AC 12–15 years, heat pumps 10–15 years. High-quality maintenance extends operating life and preserves manufacturer warranties.

When Replacement Is Recommended Versus Repair

Decisions to replace often hinge on age, repair frequency, and efficiency. Common guidelines: replace if the furnace or AC is over 10–15 years old, repair costs exceed 50% of replacement, or the system can’t meet comfort needs despite servicing.

Replacing both furnace and AC together often yields better system compatibility, efficiency, and longer-term savings.

Key Takeaways And Next Steps

Estimating how much a new furnace and AC unit installed will cost depends on equipment selection, home specifics, local labor rates, and incentives. Typical combined replacement ranges from $6,000 to $15,000, with variations based on efficiency and ductwork needs.

Next steps: obtain multiple detailed estimates, verify incentives, request load calculations, and evaluate financing if needed. Proper due diligence helps ensure a fair price and a reliable, efficient HVAC system.

Resources And Where To Learn More

Useful resources include the Department of Energy, ENERGY STAR, DSIRE, and local utility program pages. Manufacturer websites and consumer reviews help compare models and warranties, while local licensing boards confirm contractor credentials.

Contacting multiple licensed HVAC contractors and requesting written, itemized estimates is the most practical way to determine the exact cost for a specific home and project.