What Does a New Furnace Cost? 5 Things You Need to Know

Posted on: September 28, 2017 | by: HVAC.com April 17, 2019

If you’re in the market for a new furnace, then you’re undoubtedly wondering how much it’s going to cost. Since every homeowner’s needs are different, it makes it impossible to give a “one-size-fits-all” answer. But consider these important things to get a better idea of how much your new furnace may cost:


1. Energy Source

  • The most important thing to consider when determining your new furnace cost is the energy source. Typically, unit costs for electric furnaces are the least expensive, followed by gas and then oil furnaces.


  • Check out the following chart for a better idea of furnace prices based on your energy source. It compares the average prices for a standard efficiency and a high efficiency, name brand furnace that would be best suited for use in a 1,500 to 2,000 sq. ft. home


  • Average New Furnace Cost (Price + Installation)*


Type of FurnaceStandard Efficiency FurnacesHigh Efficiency Furnaces

* These prices are an average estimated cost and are not guaranteed. Prices will vary based on city, cost of living, brand, efficiency, warranties included, and more.


2. Furnace Efficiency

  • Furnaces today are much more efficient than the hulking behemoths we remember from our childhood. That means that you have a host of different options when you’re looking to purchase your new unit. Furnaces with higher AFUE ratings run more efficiently, and therefore cost more to purchase upfront, but end up saving you money in the long run on your utility costs.As you search for your new furnace, keep in mind that a jump from a standard efficiency furnace to a high-efficiency furnace can cost anywhere between $400 and $1,000 more depending on the size and energy source.


3. Size Makes a Difference

  • We’ve written before about how the right-sized furnace can save hundreds in energy costs over the years. Well, it can also save money upfront.
  • Just like most things in this world, bigger means more expensive. Have your contractor perform a Manual J HVAC load test to determine the right-sized furnace for your home so you don’t waste money on a furnace that costs more upfront and increases utility bills over the years.
  • Depending on the furnace’s energy source, an increase in size can have different effects on a unit’s initial price. For gas furnaces, for example, a 20,000 BTU increase costs around $600 for smaller furnaces and up to $1,500 for larger furnaces, while the same capacity increase for oil furnaces stays in the $500-$600 range no matter what the unit size.


4. Installation

  • Installation costs include the time it takes to install the furnace, where it’s being installed, how difficult it is to install, and whether or not new ductwork needs to be installed.
  • I know, I know. Your ducts are fine, just install the new furnace already! But, odds are, your new furnace will be more efficient than your old system, and that usually means new ductwork is necessary to ensure proper airflow and maximum efficiency. Like everything else when it comes to HVAC installation, it all depends on your home and the furnace you choose.
  • The chart below gives a total price range for new furnace costs plus the installation, without any issues that may arise. If you want to make sure you budget for possible scenarios, you may want to also include a contingency budget for any unforeseen issues that may arise.


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5. Do-it-yourself home energy audits

Though the cost of a new furnace is one expense to plan for, overall energy bill savings are another consideration to make as you’re considering a new furnace purchase. Home energy audits help you assess the overall efficiency of your home, and can also help you find a way to save money on your HVAC equipment. By reviewing the interior and exterior of your home you can evaluate your home’s energy efficiency and determine where you can find energy savings. Like with many projects around the house, your budget will dictate who performs your home energy audit. Depending on how much time and money you want to spend, you can either hire an HVAC professional who is energy audit certified or perform a DIY home energy audit.


If you cannot afford the $500 to $800 that most homeowners spend on a home energy audit, you can perform a home test to locate some of your home’s inefficiencies on your own.


  • The first DIY home energy audit step is to review your energy bills.Energy Star has a simple and useful tool, called the Energy Star Home Energy Yardstick, that helps you compare your energy bills to similar homes across the country. If your bills are considerably higher than similar homes or they have been steadily increasing, you may have a problem.


  • Walk through your home and ensure that your doors and windows are free of any drafts.Poor insulation and gaps in your windows and doors let indoor air escape and outdoor air in, costing you money.


  • Caulk and seal any drafty windows or doors.This is one of the easiest things you can do to save energy and money!


  • What to expect during a professional audit: once you find a professional, there are several things you should expect during your two to three hour home energy audit.
      • First, your professional will walk the exterior of the home searching for leaks or broken seals and assessing your outdoor HVAC units, window location and plants or trees that affect your home’s energy use.


      • Next, your professional will inspect the inside of your home. Here, your HVAC pro will be looking to make sure that things like insulation, window seals, ventilation ducts and all other parts of your HVAC system are free of problems and running efficiently. As a part of the internal inspection, your professional should conduct two important tests: the blower door test and an infrared or thermographic test.


      • The blower door test is used to measure the airflow leakages in your home. Your audit professional will attach a blower door to your front door and blow air out of your home until it has reached a standard pressure. He will then measure the air flowing back in through the blower door and other cracks in your home, establishing where potential problem areas are.


      • Infrared scans, also called thermographic scans, are another tool energy auditors use to assess how much air your home is leaking. Often times, this test is performed during the blower door test to maximize the opportunities for finding leaks. Your professional will use an infrared scanner to determine whether or not the insulation in your home is effective and if not, where additional insulation is needed.


    • Once your auditor has finished, you will receive a report with the findings of your home energy audit. This report will include steps you can take to increase the efficiency of your home. This is where the energy savings is recognized. In order to take advantage of your energy audit, take the recommendations of your energy audit professional seriously. Implement as many of the recommendations as you can, and I promise that your investment will pay off.



Finding the right furnace and determining how best to save money on your energy bills can be a difficult process, especially when you consider all the different factors that affect how much you’ll pay for your new unit and overall heating costs. As you begin your search for the perfect furnace for your home and budget, use the information here to help you make informed decisions. And, if you need help, feel free to contact an HVAC professional by browsing HVAC.com’s Contractor Directory.

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