Furnace Replacement Cost by Type
Fuel type is the biggest driver of what you’ll pay. Most homeowners replace like for like, so if you already have a gas line and a chimney or PVC vent, a new gas furnace is usually the most economical swap. Converting fuels (for example, oil to gas) adds fuel-line, venting and sometimes tank-removal work.
| Furnace type | Typical installed cost | Efficiency (AFUE) | Best fit |
|---|---|---|---|
| Electric | $2,000 – $7,000 | ~95–100% | Mild climates, homes without gas service |
| Natural gas, standard (80%) | $3,200 – $6,000 | 80% | Like-for-like swaps, moderate climates |
| Natural gas, high-efficiency | $4,000 – $7,500+ | 90–98% | Cold climates, long heating seasons |
| Propane | $3,700 – $12,000+ | 80–98% | Rural homes without a gas main |
| Oil | $6,000 – $10,000 | 80–90% | Existing oil homes, mainly the Northeast |
Electric furnaces are the cheapest to buy and install because there’s no gas line or flue, but they’re usually the most expensive to run where electricity costs are high. That’s why many homeowners who are shopping electric also price out a heat pump installation, which heats with far less electricity.
High-efficiency condensing gas furnaces (90% AFUE and up) typically add $1,000 to $2,000 over a standard 80% model. They vent through PVC pipe and need a condensate drain, so the first upgrade from an 80% unit may include some venting changes. In cold northern states the fuel savings usually justify the premium; in the South, a standard unit often makes more financial sense.
Cost by Home Size and BTU Rating
Furnaces are sized in BTUs. A common rule of thumb is 30 to 60 BTUs per square foot depending on climate and insulation, but a proper installer should run a Manual J load calculation rather than just matching your old unit.
| Home size | Approx. BTUs needed | Typical installed cost |
|---|---|---|
| 1,000 – 1,500 sq ft | 40,000 – 60,000 | $2,500 – $5,000 |
| 1,500 – 2,500 sq ft | 60,000 – 100,000 | $3,500 – $6,500 |
| 2,500 – 3,500 sq ft | 80,000 – 120,000 | $4,000 – $9,500 |
| 3,500+ sq ft | 120,000+ (or two systems) | $5,500 – $10,000+ |
Bigger isn’t better. An oversized furnace short-cycles, wears out parts faster and leaves rooms uneven. If your home has had new windows or attic insulation added since the old furnace went in, you may be able to drop a size and save money.
Cost Breakdown: Materials vs. Labor
The furnace itself is usually the largest line item, but labor, permits and small parts add up. Here’s how a typical mid-size gas furnace replacement breaks down:
| Item | Typical cost |
|---|---|
| Furnace unit (gas, 60k–100k BTU) | $1,500 – $4,500 |
| Installation labor (4–10 hours) | $800 – $2,500 |
| Venting, fittings, filter rack, gas connector | $150 – $600 |
| Old furnace removal and disposal | $50 – $330 |
| Permit and inspection | $50 – $400 |
| Thermostat (optional smart upgrade) | $200 – $500 |
HVAC technicians generally bill $75 to $150 per hour, and a straightforward swap takes most of a day. Contractors usually quote a flat installed price rather than hourly, so compare total bids, not labor rates.
Other Factors That Affect the Price
Efficiency and features
Single-stage furnaces are the cheapest. Two-stage and modulating models with variable-speed blowers cost more but run quieter, hold temperatures more evenly and use less electricity for the fan.
Ductwork condition
Minor duct repairs and sealing commonly run $200 to $700. If the ducts are undersized, leaky or falling apart, partial or full replacement can add $1,400 to $6,000 or more to the project.
Venting and gas line changes
Moving from an 80% to a 90%+ furnace means new PVC venting and a condensate drain. Switching fuels or relocating the unit may require a new gas line; see our gas line installation cost guide for those numbers.
Access and location
Basement installs are easiest. Attics, tight closets and crawl spaces take longer and cost more, especially if the unit has to be carried through a small hatch.
Permits
Most jurisdictions require a mechanical permit for furnace replacement. Fees range from about $50 to several hundred dollars depending on the city. A reputable contractor pulls the permit and schedules the inspection.
Region and season
Labor is pricier in large metro areas and the Northeast and West Coast. Demand spikes in fall and during the first cold snap, when emergency replacements leave little room to negotiate.
Add-ons bundled into the quote
Some bids include extras you may or may not need: a whole-house humidifier ($400 to $1,200 installed), an air filtration upgrade ($400 and up), duct cleaning ($450 to $1,000) or a service plan. None is required for the furnace to work, so ask for them as separate line items.
What a Good Furnace Replacement Quote Should Include
Because contractors package jobs differently, two quotes with a $1,500 gap may not be for the same work. Before comparing prices, make sure each bid spells out:
- Exact model number and capacity (BTU input and output), plus the AFUE rating.
- Load calculation method, ideally a Manual J rather than a rule of thumb.
- Venting and gas work: new flue liner, PVC vent runs, condensate drain or pump, gas shutoff and connector.
- Permit, inspection and disposal of the old unit.
- Warranty terms: parts coverage (often 10 years with registration) and the contractor’s own labor warranty, which varies widely.
- Start-up and testing: combustion check, gas pressure, temperature rise and a carbon monoxide test.
A detailed written quote protects you if something is left out, and it makes it easy to tell whether a lower bid is a real bargain or just a smaller job.
Before you hire: get at least three written, itemized quotes from licensed and insured local pros. Prices for the same job often differ by 30% or more, and comparing line items is the fastest way to spot padding or missing work.
Repair vs. Replace: When a New Furnace Makes Sense
Gas furnaces commonly last 15 to 20 years with regular maintenance. Replacement usually makes more sense than repair when:
- The furnace is 15+ years old and needs a major part like a heat exchanger, control board or inducer motor.
- A cracked heat exchanger has been confirmed. This can leak carbon monoxide and is typically not worth repairing on an older unit.
- Repair bills are climbing year after year, or a single repair would cost a large share of a new unit.
- Heating bills keep rising even though usage hasn’t changed, which points to falling efficiency.
- Rooms heat unevenly or the system short-cycles, often a sign of a failing or wrongly sized unit.
Can you replace a furnace yourself?
Not realistically. Furnace installation involves gas connections, combustion venting, electrical wiring and carbon monoxide safety. Most areas require a licensed HVAC contractor and a permit, and manufacturers can void the warranty on units that weren’t professionally installed. Leave this one to a pro.
How to Save Money on Furnace Replacement
- Get at least three quotes. Installed prices for the same furnace often vary by $1,000 or more between contractors.
- Replace before it fails. Scheduling in spring or late summer gives you time to compare bids; emergency replacements in January rarely get the best price.
- Check utility rebates. Many gas and electric utilities offer rebates on high-efficiency furnaces, smart thermostats or heat pumps. Search your utility’s website or ENERGY STAR’s rebate finder.
- Know the federal credit is gone. The federal 25C tax credit that covered high-efficiency furnaces does not apply to equipment placed in service after December 31, 2025, so don’t count on it for a 2026 installation.
- Right-size the unit. Ask for a Manual J load calculation. A smaller, correctly sized furnace costs less to buy and run.
- Ask about manufacturer promotions and financing. Brands often run seasonal rebates through dealers, and some offer 0% financing.
- Compare mid-tier brands. Premium badges add cost; many mid-range furnaces share similar core components and warranties.
Keep your new furnace running efficiently with an annual tune-up (typically $70 to $300) and regular filter changes. If your cooling side is acting up at the same time, a failed part may be a cheap fix; see our AC capacitor replacement cost guide before assuming the whole system needs replacing.
Frequently Asked Questions
How much does it cost to replace a gas furnace?
A standard 80% AFUE gas furnace typically costs $3,200 to $6,000 installed. High-efficiency 90–98% AFUE models usually run $4,000 to $7,500 or more, depending on size and venting changes.
Is it cheaper to replace a furnace and AC at the same time?
Usually, yes, per unit of work. You pay for one installation visit, one permit in many areas, and you get matched equipment. Total cost is higher, of course, so it makes most sense when the AC is also aging.
How long does a furnace replacement take?
A like-for-like swap typically takes 4 to 10 hours, so most are finished in one day. Fuel conversions, new venting or ductwork can stretch it to two or three days.
Is there a tax credit for a new furnace in 2026?
No federal one. The 25C energy efficient home improvement credit does not apply to property placed in service after December 31, 2025, according to the IRS. Check your utility and state energy office for local rebates instead.
What size furnace do I need?
Rough estimates run 30 to 60 BTUs per square foot depending on climate, so a 2,000 sq ft home might need 60,000 to 120,000 BTUs. A contractor should confirm with a Manual J load calculation rather than just copying your old unit’s size.
Should I repair or replace a 20-year-old furnace?
At 20 years, most gas furnaces are at or past their expected lifespan. Unless the repair is minor and cheap, replacement is usually the better value, especially if the heat exchanger is cracked.
