The True Cost of Furnace Replacement: A Consumer Guide
Straight talk from Wisconsin’s Master Tradesman about the true total cost to install a new furnace.
If you’re in Southeast Wisconsin and considering a replacement for your heating system, chances are it’s been a while since the last time you checked on furnace pricing. Or maybe you weren’t considering a replacement, but a sudden furnace failure has taken you by surprise. It happens to the best of us!
So the big question is: How much does a furnace cost these days? Here we aim to give a comprehensive answer, one that details all the contributing factors to the final, real price of a new furnace.
Installing a forced-air furnace in your home should cost between $4,200 and $10,000.
This is the type of short-but-sweet answer you might come across early in your research. Is it accurate? Yes (we did the math). Is it satisfactory? Probably not. That’s a $5,800 difference between the minimum and maximum estimates for a new furnace, which leaves a lot of room for unexpected costs.
A reasonable person would argue there’s no sense budgeting for a $4,200 purchase only to be jump-scared by a $10,000 bill. Likewise, setting aside $10,000 for a new heating system “just in case” is not feasible for most people.
Fortunately, you DO have some control over the final amount you’ll pay for your new furnace. Grab a coffee and get comfortable, because it’s time to learn the ins and outs of the furnace replacement process as it pertains to you, the buyer.
From Initial Quote to Final Invoice (and Everything in Between)
If honesty is the best policy, then specificity must be a virtue. That’s why, before we even touch your heating system, we’ll provide you an itemized quote that lists any anticipated costs associated with your new furnace installation.
The items you see on the quote may include some unfamiliar terms, but they’re not written in a cipher or dipped in magic ink so that only we can interpret them. Rather, they are listed for your benefit. We actually want you to understand what you’re looking at! And that starts with knowing the three main parts of the installation process.
The total cost of a furnace replacement comes down to 3 major factors:
Equipment and materials (~$2,000 to $6,000)
Permits and installation (~$800-$2,125)
Complementary services and accessories (~$100-$2,000)
Remember the total price range we started with? It was too wide, too vague, and just not that helpful. By breaking it down into these three categories, we’ve already come a long way toward specificity.
Calculating the “Big Three” (One at a Time)
Equipment & Materials: ~$2,000-$6,000
Number one is first for a reason: the purchase price of your new heating system is largely determined at this point in the decision-making process.
Things that can increase or decrease this number include:
- The type of furnace you select to replace your previous one.
- The efficiency rating of your replacement furnace.
- The heating requirements of your home and family.
The type of furnace you select is 100% your choice. If you have questions about your options, our furnace experts are both knowledgeable and happy to make good-faith recommendations for you. What we’ll never do is push for expensive equipment that you neither want nor need.
Keep in mind that the more similar your new furnace is to your old one, the easier it will be to install! Upgrading to a significantly newer model can absolutely be worthwhile, but may require a little extra work to make sure it runs smoothly with your home HVAC system. In this case, we’ll account for the cost of the upgrade and make sure it’s stated clearly in your initial quote.
Understanding the Relationship between Equipment Costs and Material Costs
Equipment and materials are technically separate things, but they’re heavily interrelated. We’ll take a quick look at each one for the sake of seeing how they work together.
Equipment alone: $1,400 to $3,000
Team Austin installs and repairs all kinds of furnaces, but we do not manufacture their parts for individual sale. Instead, the price of each part is factored into the cost of the installation. Predicted equipment costs depend on furnace type.
- For a standard gas furnace (80% energy-efficient): $1,400.
- For a mid-efficiency furnace (92%, single-stage): $1,800.
- For a high-efficiency furnace (96%, two-stage): $2,000-$2,700
- For an ultra-high-efficiency furnace (97%, modulating): $2,500 to $3,000+.
Materials alone: $150 to $500
Even the most basic of furnace replacements tends to require some ductwork mods, new fittings, and other materials to make it happen. These vary according to the furnace types shown above. Common examples include:
- Sheet metal for reconnection to plenum
- Electrical fittings
- Gas pipe fittings
- Incoming gas shut-off valve
- Flue and vent pipe fittings
- Condensate drain fittings and tubing
The only real difference between equipment and materials is logistics. We say “materials” to refer to equipment that is not built into the furnace itself. Even though we have to acquire them separately, they’re reflected the same way in your bill (as overhead costs).
Give it to me straight: What’s a “normal” amount to budget for equipment + materials?
It really does come down to your preference of furnace. But, as a rule of thumb, equipment/material costs should represent at least one-third of the total price. For example, there’s no reason your bill should total $10,000 (the high end) if the furnace you selected and the tools required to install it only add up to $2,000 (the low end). On the other hand, if your choice of furnace weighs in at a value of $6,000, you can reasonably expect your final bill to total around $10k.
Permits & Installation: ~$800-$2,650
It takes effort to adapt a new furnace to one’s existing ductwork, air conditioner, and other home HVAC system components. Needless to say, furnace installation is a matter of time and labor just like any other service.
Before we can even begin an installation, HVAC companies must first acquire a permit. This represents a small, but necessary part of your bill, which many homeowners aren’t aware of before we explain it to them.
The Permit: $150
The permit’s benefit to you is found in the post inspection. After we’ve replaced your furnace, the local building inspector will come out to evaluate our work and verify we did everything by the books. It’s extremely rare for the price of a permit to exceed $150, and even rarer for the inspector to order any modifications-at least, when you choose the right HVAC company.
The Installation: $1,200-2,500
The act of installing a furnace involves a lot of moving parts. Here are some examples of normal installation items you’ll likely see on your quote:
- Delivery of the new furnace
- Floor protection materials (drop cloths or other methods)
- Removal, haul-away, and disposal of your furnace by a secondary support technician
- Connecting the new furnace to your existing supply ductwork
- Connecting the new furnace to your existing return ductwork
- Connecting the new furnace to your electrical or gas system
- Reconnection to your venting or exhaust system
- Installation of any accessories purchased
- Completion of any necessary HVAC code updates
- Client training and install overview
- Warranty registration and post-installation follow-up
Essentially, our job can be summed up as adhering to state and local codes while adapting new furnaces to their respective homes. To us, they are of equal importance.
Optional Accessories: ~$100-$2,000
These are all the things that go hand-in-hand with furnace replacement. Some of them, such as humidification systems, are simply nice to have: they complement your new heating system well and add to a pleasant overall home experience. Other items, like filters, are things that must be bought eventually-some people just like to get this out of the way while we’re there.
Here are some common examples of popular furnace accessories and add-ons:
- Humidifiers. While your furnace is heating the air inside your home, it is also drying it out. Tons of Wisconsin homeowners end up discovering the joy of whole-home humidifiers, which return a healthy level of humidity to the air indoors. There’s quite a number of options within this category, ranging in price from $750 to $1,500.
- Thermostats. The mission control center of your heating and cooling system is your thermostat. If you have an old mechanical thermostat at home, you may want to consider replacing it with an easy-to-use digital thermostat. You may also choose to go with a wifi thermostat or a “smart stat”. Regardless, customers tend to prefer to get their thermostat upgraded at the same time as their furnace.
- Air Filtration. All furnaces require a filter. Furnace filters serve to catch small debris that could otherwise damage the internal blower. But what about the dirt, dust, pollen and other invisible debris suspended in the air we breathe? For clients who want cleaner, healthier air, we recommend adding an air cleaner to your new heating system. That leads us to…
- Air Purification. Viruses, Mold, Germs and other living organisms that float about the air in your home may be caught by the furnace filter or air filtration system-but as long as they’re alive, they still pose a health risk. It’s easy to see why clients who demand the highest quality indoor air opt to have an air purification system installed along with their furnace replacement.
- Ductwork Modifications. Unfortunately, some HVAC concerns just can’t be solved with a furnace replacement. If a room in your house isn’t heating or cooling properly, there’s a high chance that your ductwork (or lack thereof) is to blame. Is the area physically accessible? If so, we don’t recommend messing with it yourself-but we can install additional heat runs, duct-boosting fans, or make other modifications on the same day as your furnace installation. Why not gain a little comfort and save some money in the process.
- Air Duct Cleaning. The furnace installation process inevitably knocks loose all kinds of dust and debris from the surrounding ductwork. With all the dirt and allergens that suddenly reveal themselves-not to mention humans’ natural desire to start with a “clean slate”-it’s common for clients to kick off this chapter of their lives with a whole-home air-duct cleaning service, which takes place alongside the furnace installation.
Common Questions and Concerns about Buying a Furnace
“Am I getting my money’s worth?”
Because no two HVAC companies are alike, the price of an installation won’t be equal from company to company-even if the furnaces installed are identical. This is because they all have their own unique set of standards for installs.
For this reason, as well as the many other factors routinely lumped into overhead, the cost of the service reflects more than the quality of the furnace. It’s a statement about the quality of the company doing the work.
The adage that you “get what you pay for” is especially true in this industry. The more reputable companies tend to charge higher prices, and it’s usually not a good idea to go with the cheapest contractor or furnace you can find-unless you want a really short-term solution to your heating problems.
A new furnace is a once-in-a-lifetime investment for most Wisconsin homeowners. We treat this decision with the seriousness it deserves.
“Furnace brands: do they matter?”
Warning: unpopular fact incoming! Are you ready?
The least important factor of selecting a replacement furnace contractor is the brand of the furnace they install. Of the 50+ furnace brands out there, none of them are really unique when looking under the hood.
Why? Because behind these many brand names, there’s just a handful of furnace manufacturers.
Sure, there are little differences from brand to brand. But they boil down to things that don’t matter to the consumer-things you’re probably not even thinking about (nor should you have to). We’re talking about considerations like: How is the brand distributed in your market? How many different distributors can your HVAC contractor get parts from in the future? Is the product designed and assembled in the USA? As exciting as these things may sound (not), you don’t need to fall asleep pondering them.
Austin Plumbing, Heating & Air is a family business. Our name is on the line. That’s our motivation to be picky on your behalf, and it’s why we only install brands that we’d trust with our 80-year legacy.
Team Austin: Eight Decades of Keeping Wisconsin Warm
Want your furnace to live a long life? If you play your cards right, a new heating system can last 15 to 20 years. But if you pick the wrong contractor, it can break in as little as 10 (regardless of the brand name on the furnace).
The most important day of your furnace’s life is the day it’s installed. Seriously! A proper install has lasting ramifications that go well beyond any manufacturer’s control. Don’t set yourself up for regret. Get it done right the first time. Call on Austin Plumbing, Heating & Air at 262-367-3808 to have a heating guru replace your old furnace right away.