If you’re reading this when the weather outside is warm and toasty, it may seem like a ridiculous time to think about buying a furnace — but it just might, be the best time. You can make your purchase when prices are likely to be lower, and when you don’t need to make a quick, panicked decision because it’s freezing outside.
When you need a new furnace, there’s typically not much time to hem and haw over costs. In cold weather, being without your furnace can be dangerous to residents living in the home and potentially lead to water damage from a burst pipe in a deep freeze. But you don’t want to overpay for your furnace replacement, either.
If you’ve been having repeated issues with your furnace or know that the heat source is nearing the end of its functional life, be proactive by researching your cost options now.
The average cost of a new furnace in the U.S. is $4,801, according to HomeAdvisor.com, with a range between $2,819-$6,879.
Factors that influence the price of a furnace include the materials used in its construction, the type of equipment it is and the labor required for installation.
To help you understand how the total cost of your furnace replacement adds up, we break down the details about the furnace itself, labor and additional materials costs for installation and how to keep your new furnace in working order after it’s installed.
[READ: 10 Ways to Save Energy and Lower Utility Bills]
How Much Does a Furnace Cost?
First, you’ll need to know if you have a gas, electric or oil furnace. Electric furnace installation tends to be the least expensive, ranging between $2,116 and $7,888, according to HomeAdvisor. Installing a natural gas furnace falls in the range of $3,800 to $10,000, and an oil furnace ranges $6,750 to $10,000.
It is possible to change the type of furnace you have, or even to a new system like a heat pump, which typically requires less energy to heat through electricity and is considered more environmentally friendly.
The cost to transfer from a furnace heating system to heat pump will be more than a simple furnace replacement, but homeowners who switch in 2025 can claim a tax break up to 30% of the cost to purchase and install heat pumps in their homes (up to $2,000) along with up to another $600 for needed electrical upgrades to install the new system.
Furnace sizes are based on the measurement of British thermal units, or Btu, which is the amount of energy required to increase the temperature of a pound of water by 1 degree Fahrenheit.
To figure out how many Btu your furnace must have to heat your home, you need to know the square footage of your house and what climate zone or region your house is in — there are five. Armed with that information, you can find many Btu calculators online that will help you determine your furnace size, including Modernize’s calculator, which has a climate zone map to help you determine the right zone and also asks the rough age of your windows and insulation.
According to the calculator, for a 2,000-square-foot home with new windows in the last 15 years in zone 3 (which includes the mid-Atlantic, roughly all of Kentucky, parts of the lower Midwest and upper South and some patches of New Mexico, California, Oregon and Washington), the right-size furnace is 80,000-90,000 Btu. The price of that size furnace varies widely depending on brand and distributor, but ranges between $1,500 and $5,000 for a standalone item from the likes of Lowe’s, HVACDirect.com, Walmart and Amazon. And, of course, look hard enough, and you may find a furnace that is cheaper or more expensive.
“I always recommend choosing modern high-efficiency models with an AFUE rating of 95% and above,” says Jason Altshuler, CEO of My Electric Home, a home electrification services company in Centennial, Colorado.
AFUE stands for annual fuel utilization efficiency, and it measures how efficiently a furnace converts fuel into energy.
“These allow you to significantly reduce energy costs because nearly all the energy goes toward heating rather than being wasted,” Altshuler says. “However, choosing a new furnace shouldn’t be based only on brand or price.”
Altshuler says that “one of the most common misconceptions is that more power means better performance. In practice this often causes an oversized furnace to cycle on and off frequently before it can reach its optimal operating temperature. This is called short cycling and it results not just in a loss of efficiency but also in faster wear on the equipment.”
But don’t get a furnace that’s too small, Altshuler warns. In that case, “the system will run constantly and still struggle to keep the home warm.”
[Related:What Is Radiant Heat? Pros, Cons and Costs (2023)]
How Much Does Furnace Replacement Cost?
Aside from the furnace itself, there are a few factors that contribute to the total cost of getting it up and running. Here’s what to keep in mind:
— Labor. Home improvement website Angi suggests that you’ll pay $75 to $100 an hour for someone to install your home furnace. Of course, this number goes up or down for a variety of reasons — location and availability of skilled laborers to do the work, for one, and the time of year and demand for furnace installation can also impact the total price tag.
— Old furnace removal. How hard is your current furnace to get to and remove? Furnace removal can be simple or complicated and is often a part of the package for new furnace installation. When you get estimates from contractors, be sure this is part of the total cost — including disposing of the old unit.
— Venting. There are other factors about your home and existing furnace that could also drive up the cost. If you need to change your existing venting, for instance, that could drive up your costs.
— Local permits. Many parts of the country require permits to install new furnaces, and those often come with a small cost. Many HVAC professionals will take care of this part of the process for you, but be sure to check what your local municipality or county requires, and verify the contractor will be doing so.
— Ductwork. You may be able to see some ductwork in your attic or basement, as well as coming out of your current furnace. Old or undersized ductwork may need to be replaced to ensure a new furnace functions properly and efficiently. Home improvement project information company HomeWyse estimates it’ll take approximately $15 to $18 per linear foot to install ductwork. That can add up. If it’s easier to think in big numbers versus smaller per- foot numbers, This Old House estimates that replacing air ducts can cost between $250-$12,000, which is a stunningly wide range of dollars. “This step often gets overlooked, but leaks and blockages in the ductwork can waste 30% or more of the heat,” Altshuler says.
— Insulation, windows. The energy efficiency of your home plays a role in determining the type of furnace you may need, but you may also decide to improve your home and reduce heating costs throughout the winter. New insulation and windows in an old home can help slash the amount of heat escaping in cold weather, so your furnace doesn’t have to work as hard. If you can’t afford to replace windows, weatherstripping to reduce air leakage can help.
— Timing matters. “Off-season, like spring or early fall, is the best time to get the lowest pricing and better installer availability,” says Glenn Gault, the CEO of Gault Heating & Cooling, a family business since 1955 based out of Hubbard, Ohio. “An even smarter way will be buying a furnace in late spring, and installing it in early fall,” he says, explaining that buying and installing in the same off-season window limits your leverage. “Stagger it to get the best deal and lock in pricing before fall demand spikes.”
— Negotiate add-ons. “Negotiate add-ons, not discounts,” Gault says. “Most contractors won’t budge much on price, but you can often get extras thrown in, like a better thermostat, duct sealing or upgraded filter cabinet, for free if you ask after the initial bid.” Gault also advises: “Ask what doesn’t come standard. Some installers charge extra for things that should be included, like new flue piping or code upgrades. Knowing what’s optional helps you spot shady bids. That’s why you always should ask for all-in quotes. Insist on itemized bids that include ductwork tweaks, disposal, permits and labor, so you don’t get nickel-and-dimed later.”
— Don’t get hung up on the brand. “Skip the brand obsession, a lesser-known furnace with solid specs and a quality install often outperforms a premium brand done poorly,” Gault says. “Focus on fit, not just efficiency. An oversized furnace wastes energy and money. Have your contractor do a proper load calculation.”
— Think about incentives. “Don’t forget about utility rebates and tax credits,” Gault says. “Check DSIREusa.org or ask your installer what incentives apply to your region.”
— Be aware of scam artists. “Never agree to same-day install if you just met the contractor. Quick turnaround is great, but if someone pushes you to sign today with no time to compare or read the fine print, walk away,” Gault advises. Not that a same-day install offer is a sign that you’re working with someone shady, but you really can’t be too careful.
[Read: How Much Do Energy-Efficient Windows Cost?]
How to Keep New Furnace Maintenance Costs Down
Just like with every part of your heating and cooling system, it’s vital you change your air filter for your furnace regularly. Most recommendations say to do it between every 30 and 90 days. If you have pets that shed or live in a dusty or high-pollen region, you may want to change it closer to every 30 days.
Experts say you should also have your furnace serviced by a professional once a year to ensure parts are clean and it’s in good working order. Ideally, reach out before you turn on the heat regularly for the year.
Of course, if you suddenly notice higher- than-usual electric or gas bills, and especially if friends and neighbors aren’t reporting higher-than-the same about their energy bills, it might be a good idea to have a professional come take a look.
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Furnace Replacement: How Much a New Furnace Costs originally appeared on usnews.com
Update 07/03/25: This story was published at an earlier date and has been updated with new information.
