Furnace Installation Cost Calculator
Quick answer: Furnace installation typically costs $2,350–$6,000, averaging $4,100 installed — close to the $4,200 national average. Gas furnaces run $2,200–$5,500, electric $1,500–$4,800, and oil or propane $2,500–$8,000, depending on efficiency tier and home size. Use the calculator above for an estimate based on your fuel type, square footage, and efficiency tier.
Get an accurate furnace replacement cost estimate — by fuel type, home size, and efficiency tier. Built from regional contractor data across all 50 states.
Reviewed by MyProjectCost Team
Furnace Installation Cost by Type (2026)
Fully installed cost including unit, labor, and standard connections. Costs assume a 1,500–2,000 sq ft home with existing compatible ductwork.
| Furnace Type | Low | Average | High | Notes |
|---|---|---|---|---|
| Gas — Standard (80 AFUE) | $2,200 | $3,800 | $5,500 | Most common choice; lower fuel cost than electric in most regions |
| Gas — High-Efficiency (95+ AFUE) | $3,000 | $5,200 | $7,500 | Two-stage or modulating burner; qualifies for federal tax credits |
| Electric | $1,500 | $3,000 | $4,800 | Lower install cost; higher monthly operating cost in cold climates |
| Oil | $3,200 | $5,500 | $8,000 | Prevalent in Northeast; requires oil tank, subject to fuel price swings |
| Propane | $2,500 | $4,200 | $6,500 | Used where natural gas lines are unavailable; requires propane tank |
Furnace Installation Cost by Size (BTU)
Costs below reflect gas furnace installation — the most common scenario. Electric furnaces run 15–25% lower; oil furnaces run 20–35% higher at equivalent BTU ratings.
| BTU Capacity | Typical Home Size | Low | Average | High |
|---|---|---|---|---|
| Up to 60,000 BTU | Under 1,000 sq ft | $1,800 | $2,900 | $4,500 |
| 60,000 – 80,000 BTU | 1,000 – 1,500 sq ft | $2,200 | $3,500 | $5,500 |
| 80,000 – 100,000 BTU | 1,500 – 2,200 sq ft | $2,700 | $4,200 | $6,500 |
| 100,000 – 120,000 BTU | 2,200 – 3,000 sq ft | $3,200 | $5,000 | $7,500 |
| 120,000+ BTU | 3,000+ sq ft | $3,800 | $6,000 | $9,000 |
How Much Does Gas Furnace Replacement Cost?
A gas furnace replacement costs $2,200 to $7,500 installed, with the national average landing near $4,200 for a standard 80 AFUE unit in a mid-size home. The wide range reflects the difference between a budget 80,000 BTU Goodman unit in an easy-access utility room versus a 100,000 BTU Carrier Infinity variable-speed high-efficiency model with new flue venting.
Natural gas remains the dominant heating fuel in the United States — roughly 47% of homes heat with gas furnaces — for good reason: gas fuel costs are typically 30–50% lower per BTU than electricity in most markets, and gas furnaces deliver forceful, fast heat that most homeowners prefer in cold climates.
The single biggest decision in a gas furnace replacement is efficiency tier. A standard 80 AFUE furnace converts 80 cents of every dollar of gas into heat; a high-efficiency 95–98 AFUE model converts 95–98 cents. The tradeoff is upfront cost: high-efficiency models run $800–$2,000 more to purchase and install because they require a secondary heat exchanger and PVC venting rather than the metal flue used by 80 AFUE units. In cold northern climates where furnaces run 1,500+ hours per heating season, the annual savings of $200–$600 makes the premium worthwhile for most homeowners planning to stay in the home 5+ years.
How Much Do Different Furnace Brands Cost to Install?
Budget brands like Goodman start around $1,800 installed, mid-range brands like Rheem run $2,200–$4,700, and premium brands like Carrier or Lennox range from $3,000–$8,500.
Brand choice is one of the most consequential decisions in furnace replacement — not just for upfront furnace cost, but for long-term reliability, parts availability, and contractor relationships. Premium brands like Carrier, Trane, and Lennox operate through factory-authorized dealer networks, which means installation quality is more tightly controlled but list prices are less negotiable. Budget brands like Goodman and Daikin (Goodman's parent) are widely available and installed by any HVAC contractor, giving you more ability to shop labor costs.
| Brand | Tier | Unit Cost | Install Labor | Total Installed | Notes |
|---|---|---|---|---|---|
| Carrier | Premium | $1,800 – $3,500 | $1,500 – $3,000 | $3,500 – $6,500 | Infinity series tops at 98% AFUE; strong dealer network nationwide |
| Trane | Premium | $1,900 – $3,800 | $1,500 – $3,200 | $3,700 – $7,000 | XV series known for long-term reliability and quiet operation |
| Lennox | Premium | $1,700 – $3,600 | $1,500 – $2,900 | $3,400 – $6,500 | Dave Lennox Signature Collection reaches 98.7% AFUE — industry high |
| Rheem | Mid-Range | $900 – $2,200 | $1,200 – $2,500 | $2,200 – $4,700 | Classic Plus series widely available; good warranty coverage |
| Goodman | Budget | $700 – $1,800 | $1,100 – $2,200 | $1,800 – $4,000 | Lowest installed cost; 10-year parts warranty included standard |
📊 Our Pricing Methodology
MyProjectCost furnace installation estimates are built from regional HVAC contractor pricing data, equipment wholesale cost trends, and installation labor rates across all 50 states. Figures represent fully installed costs — unit price plus professional labor, standard connections, and disposal of the old unit where noted. Costs are reviewed and updated regularly to reflect current market conditions. Individual quotes will vary based on your contractor, local labor market, home configuration, venting requirements, and equipment selection.
Last reviewed: June 2026
Gas vs. Electric Furnace: Pros & Cons
The gas vs. electric decision is the most common choice homeowners face when replacing a furnace. Here's how the two compare across the factors that matter most.
| Factor | Gas Furnace | Electric Furnace |
|---|---|---|
| Installed Cost | $2,200 – $7,500 | $1,500 – $4,800 |
| Annual Operating Cost | $500 – $1,200 (cold climate) | $1,200 – $2,500 (cold climate) |
| Heat Output Speed | Fast — powerful heat delivery | Slower — gentler warm air |
| Lifespan | 15 – 20 years | 20 – 30 years |
| Maintenance | Annual tune-up recommended | Lower maintenance; no combustion |
| Safety | CO risk if heat exchanger cracks | No combustion — no CO risk |
| Best For | Cold climates, homes with gas service | Mild climates, homes without gas lines |
| Environmental Impact | Combustion emissions | Zero direct emissions (grid-dependent) |
What Affects Furnace Installation Cost?
The six biggest factors are ductwork condition, permits, home size, regional labor rates, old unit removal, and efficiency tier — with ductwork and labor rates causing the widest swings.
1. Ductwork Condition
The single biggest variable most homeowners overlook when budgeting for furnace replacement is ductwork. If your existing ducts are leaky, undersized, or poorly routed, a new high-efficiency furnace won't perform as rated — it will work harder to compensate for distribution losses. Duct sealing adds $500–$1,500; duct replacement in a mid-size home runs $2,000–$6,000. Always ask your contractor to perform a duct leakage test as part of the replacement project. Homes with leakage above 15% benefit significantly from sealing before — not after — installing a new furnace.
2. Permit Requirements
Most municipalities require a mechanical permit for furnace installation, typically ranging from $50–$250. In jurisdictions with stricter code enforcement, inspectors will verify that the installation meets current combustion air, venting, and electrical requirements. A high-efficiency condensing furnace vents through PVC pipe rather than a metal flue — if your home's existing flue isn't compatible or usable for the old venting system anymore, re-routing adds $200–$600 in labor and materials. Your contractor should pull permits and schedule inspections as a standard part of the job. Unpermitted HVAC work can complicate home sales and void manufacturer warranties.
3. Home Size and BTU Requirements
Larger homes need higher BTU furnaces, which cost more to purchase and install. The relationship isn't perfectly linear — a 3,000 sq ft home doesn't necessarily cost twice as much as a 1,500 sq ft install because much of the labor is fixed regardless of unit size. The BTU size you need also depends on your climate zone, ceiling height, insulation quality, and window area, not square footage alone. Improving home insulation — see our insulation cost calculator — can sometimes allow you to downsize your furnace at replacement, saving $400–$1,200 on unit cost while also reducing annual heating costs.
4. Regional Labor Rates
HVAC labor rates vary significantly across the country. High cost-of-living metros like San Francisco, New York, Boston, and Seattle see installation labor of $1,800–$3,500 for a standard furnace replacement. In lower-cost markets across the Midwest, South, and Mountain states, labor typically runs $1,000–$1,800 for the same job scope. Equipment unit prices are largely consistent nationwide since they're shipped from national distributors — labor rate variance accounts for the majority of regional price differences. Always collect at least three local contractor quotes before committing.
5. Removal of the Old Unit
Old furnace removal and disposal adds $150–$400 to most projects. Some contractors include removal in their installation quote; others charge separately. Oil furnace removal is more complex when an oil tank is also being decommissioned — tank removal adds $500–$2,500 depending on whether it's above-ground or buried, and buried tanks that have leaked can trigger environmental remediation costs. Always clarify whether removal and disposal are included in contractor quotes before comparing bids.
6. Efficiency Tier and Venting Compatibility
Upgrading from an 80 AFUE to a 95+ AFUE high-efficiency condensing furnace involves more than just swapping equipment. High-efficiency furnaces produce a cool exhaust that must vent through PVC pipe, not the existing metal flue chimney. If your old flue is being abandoned, a chimney liner or cap may be needed. Adding new PVC vent runs to an exterior wall or roof penetration adds $200–$800 in most homes. This venting work is typically the largest "hidden" cost when switching efficiency tiers — budget for it explicitly when comparing 80 AFUE vs. 95+ AFUE installation quotes.
For homeowners planning broader home systems work — such as an HVAC system replacement or improvements to home weatherization — bundling furnace replacement with an insulation upgrade or other mechanical work can reduce your per-project mobilization costs. If you're also addressing water quality, see our water softener installation cost guide for another home systems project frequently scheduled alongside HVAC work.
Frequently Asked Questions
The average furnace installation cost is $4,200 for a gas furnace in a typical 1,500–2,000 sq ft home. Most homeowners spend between $2,500 and $6,500 depending on furnace type, efficiency rating, and regional labor rates. Electric furnaces run lower at $1,500–$4,800 installed, while oil furnaces are the most expensive at $3,200–$8,000. High-efficiency models (95+ AFUE) cost $1,000–$2,000 more upfront but typically save $200–$600 per year on heating bills, reaching payback in 3–7 years.
A gas furnace typically lasts 15–20 years with regular maintenance. Electric furnaces last 20–30 years because they have fewer moving parts and no combustion process. Oil furnaces average 15–25 years. Signs a furnace is approaching end-of-life include frequent repairs exceeding 50% of replacement cost, uneven room-to-room heating, rising utility bills without a change in usage, yellow or flickering burner flame on gas units, and unusual banging or rattling noises. Replacing a furnace before it fails outright avoids the emergency-rate premiums many HVAC contractors charge for unplanned installs.
In most U.S. regions, a gas furnace costs 30–50% less to operate per year than an electric resistance furnace. Natural gas averages $1.00–$1.30 per therm nationally, while electricity averages $0.13–$0.18 per kWh. Heating a 2,000 sq ft home in a cold climate typically costs $600–$1,200 per year with gas versus $1,400–$2,500 with electric resistance heat. That said, electric heat pumps — a different technology — can outperform gas in mild climates by delivering 2–4x more heat per dollar of electricity consumed. The gas vs. electric decision depends heavily on your local utility rates, climate zone, and whether ductwork is already installed.
The clearest signs you need furnace replacement include: age over 15 years (gas) or 20 years (electric), since efficiency drops sharply after these thresholds; a single repair bill exceeding 50% of replacement cost; rising heating bills without any change in usage or weather; uneven heating with some rooms consistently colder than others; a yellow or flickering burner flame on a gas unit, which can signal incomplete combustion or a cracked heat exchanger; frequent short-cycling; and unusual sounds such as banging, rattling, or squealing. An HVAC technician can inspect the heat exchanger to determine whether repair or replacement is the safer and more economical choice.
Yes. Most HVAC contractors offer third-party financing at 0% APR for 12–18 months, or longer-term installment plans for qualified buyers. The federal Inflation Reduction Act provides a tax credit of up to $600 for qualifying high-efficiency gas furnaces and up to $2,000 for heat pump systems. Many state utility programs offer rebates of $150–$600 for upgrading to a 95+ AFUE model — check the ENERGY STAR rebate finder for your state. Financing through your contractor is convenient but may carry higher interest than a home improvement loan or HELOC. Compare options before committing.
Furnace size is measured in BTUs per hour. A rough estimate: multiply your home's conditioned square footage by 30–60 BTUs depending on climate. In a cold northern climate, a 2,000 sq ft home typically needs 80,000–100,000 BTU capacity. In a mild southern climate, the same home may only need 60,000–70,000 BTUs. Oversized furnaces short-cycle — turning on and off too frequently — causing comfort issues and accelerated wear. Undersized units run continuously without reaching the set temperature. A licensed HVAC contractor performs a Manual J heat load calculation to determine the exact right size. Always request this calculation before purchase rather than replacing unit for unit without reassessing your home's actual heating needs.