Before we buy anything, we like to know how much it is going to cost. This is especially true for larger expense items such as a new furnace. And guess what? We’ve put together a helpful guide to give you an idea of what you can expect to pay for a new furnace. Let’s get started!
A new furnace, including installation, can range anywhere from $1,337 up to $15,000. That’s a pretty broad range, but there’s a reason.
The cost of a new furnace varies depending on the type of furnace being installed (gas, electric, oil), the size of the furnace, the brand, and how much labor and materials are required for the job. Simply replacing an old furnace with a new one is going to cost less in labor and materials compared to installing a new furnace system for the first time. Installing a new furnace for the first time, for a newly constructed house for example, would require brand new ductwork and other possible costs that would not be necessary with a simple furnace replacement job.
Let’s break down the costs for replacing the different types of furnaces first, and we will break down the cost of installing a new furnace for the first time afterwards.
How Much Does it Cost to Replace a Gas Furnace?
Gas furnaces are the most popular furnaces used today. They provide great heating ability and typically aren’t too expensive to run in areas where gas is readily available. If you are in an extremely cold climate and you have access to propane or natural gas, a gas furnace is the best choice.
Replacement costs for a gas furnace range from $1,457 to about $12,800. The specific cost is going to depend on the size, brand, and the model of the new furnace. The price range above begins with value-brand furnaces with heating power as low as 45,000 BTU’s and an AFUE of 80% (efficiency).
The higher end of the price range above are “higher end” brand furnaces with heating power of at least 100,000 BTU’s and an AFUE as high as 98.5%.
Wait, what!? BTU’s and AFUE? Don’t worry, I’ll explain.
BTU’s are used to determine the furnace’s heating capacity. BTU’s are also used in categorizing the different sizes of furnaces. With a furnace, BTU’s are used to determine how much heat is produced and delivered to the area to be heated. So, the size of space you are wanting to heat is going to determine what size furnace you need (how many BTU’s you will need).
AFUE simply refers to the furnace’s efficiency. It corresponds to how efficiently the furnace utilizes and uses it’s fuel – whether it is propane, natural gas, electric or oil. The most efficient furnaces use the smallest ratio of usable fuel to wasted fuel that is needed to heat the targeted area.
For example, a furnace with an AFUE of 80% wastes around 20% of the fuel and utilizes around 80% of it. A furnace with an AFUE of 98.5% wastes only 1.5% of the fuel and utilizes the other 98.5%. As you can see, the more efficient furnaces are going to waste less fuel, thus save energy and money on your energy bill.
How About Some Specific Numbers?
We went over some broad price ranges for replacing a gas furnace, but let’s get more practical. Because gas furnaces are so popular and are the most common type of furnace used today, we wanted to share some specific numbers with you. Below you will find the price range for replacing a gas furnace categorized by the size of the home (or business) in square footage.
| Square Footage | AFUE (Efficiency) | Price Range |
|---|---|---|
| 1,000 | 80% | $1,457 – $7,548 |
| 1,000 | 90%+ | $3,339 – $9,027 |
| 2,000 | 80% | $1,586 – $9,270 |
| 2,000 | 90%+ | $3,715 – $12,895 |
| 3,000+ (Could require 2 furnaces*) | 80% | $1,549 – $20,000+ |
| 3,000+ (Could require 2 furnaces*) | 90%+ | $6,696 – $20,000+ |
Please note that these are averages. It’s always advised to get a specific estimate from a certified HVAC contractor.
How Much Does it Cost to Replace an Electric Furnace?
Replacement costs for an electric furnace are slightly less when compared to a gas or an oil furnace. The price range to replace an electric furnace can range from $1,300 to $9,500. Electric furnaces are typically easier to install because they are strictly an electric system. There is no need for any gas lines or other additions. For this reason, their installation costs are going to be the cheapest when compared to the other types of furnaces. While this is a great perk, there are also some cons.
Electric furnaces tend to have higher energy costs because they run on electricity only. In most areas, where gas and oil are readily available, the cost of operation is lower for gas and oil when compared to electricity. The cost of operating an electric furnace can be over 100% more expensive than compared to its gas counterpart. To compound this problem, electric furnaces don’t seem to produce the same capacity of heat as a gas or oil furnace. Therefore, electric furnaces will usually run longer than a gas or oil furnace would when trying to heat a specific space. This equates to more energy use which equals a higher energy bill.
Electric furnaces are good options for mild climates where the temperature doesn’t drop below freezing for extended periods of time. But, they aren’t recommended for colder climates.
Here’s a quick tip: If you are considering an electric furnace, entertain the idea of getting a heat pump instead. A heat pump provides both cooling and heating from just one system.
Related: Gas Furnace vs Electric: Pros and Cons
How Much Does it Cost to Replace an Oil Furnace?
Oil furnaces aren’t as popular as gas furnaces, but they are still very effective. Oil furnaces aren’t quite as popular as they used to be. They seem to be phasing out primarily due to the cost of oil. They also tend to cost the most to install and they aren’t as efficient as gas furnaces.
Replacing an oil furnace can cost anywhere from $2,000 to $10,000 or more. Today, most of the people that are still purchasing oil furnaces are those who had one previously and don’t want to invest in a new type of furnace system.
How Much Does it Cost to Install a New Furnace (for the first time)?
When it comes to the costs associated with a new furnace, it is going to cost the most to install a new furnace in an area that doesn’t already have a furnace installed. New construction scenarios are going to be the main example of this. With new construction, new ductwork will have to be installed whereas simply replacing a furnace is as easy as connecting the new furnace to the old ductwork.
Another common scenario is changing out an electric furnace for a gas furnace. While the gas furnace can be connected to the old ductwork, gas lines will have to be installed and connected in order for the gas furnace to operate properly.
The typical price range for installing a new furnace for the first time is anywhere from $2,500 to around $15,000. As we stated earlier, the type of furnace, the size, the brand, and the labor and materials involved are all going to affect the price. But, the brand of the unit is usually going to affect the price the most.
Get Specific Prices through Free Estimates
We hope our furnace cost guide has helped you and given you a better idea of what you can expect to pay for a new furnace. We covered the different types of furnaces and the different scenarios you might face, such as replacing a furnace vs installing one for the first time.
Prior to purchasing a new furnace we strongly recommend getting an estimate or two from your local HVAC companies. Most companies will come out and provide you with an estimate for free. This will give you an exact price so that you know exactly what you will have to pay. You definitely want to take advantage of that!
Speaking of free estimates, if you live in or around the Jackson TN area and would like a free estimate on a new furnace, give us a call! You can reach us at 731-300-1030.
Thanks for stopping by!
Related: 4 Tips for Buying a New Furnace