Replacing your home’s HVAC system is a significant investment, with costs typically ranging from $5,000 to $12,500, including installation and removal of the old system. Most homeowners spend around $7,500 for a standard setup, but prices can vary widely depending on the type of system you choose. A simple window AC unit might cost as little as $450, while high-efficiency geothermal systems can reach $25,000 or more.
The total cost of an HVAC installation depends heavily on the type of unit you have and the brand you choose. It also makes a difference if we’re talking about an air conditioner, furnace, or a combination. Modern homes often combine heating and cooling into a single system, making it easier to maintain comfort year-round.
Planning ahead for HVAC replacement can help you avoid unexpected expenses and ensure your home stays comfortable in every season. In this guide, we’ll break down HVAC installation costs, key factors that affect pricing, and what to expect when upgrading your system.
Not sure what type of HVAC system you have? Check outside for a large metal unit with a fan. If it runs year-round, it’s a heat pump. If it only works in summer, it’s your AC. Look in your basement, too—the big metal box is your furnace. Take pictures of any model numbers to show your HVAC pro.
This site receives compensation from the companies featured in this listing, which may impact where and how products appear. This listing doesn’t feature all companies, products, or offers that may be available.
This site receives compensation from the companies featured in this listing, which may impact where and how products appear. This listing doesn’t feature all companies, products, or offers that may be available.
Types (and Costs) of HVAC Systems
The type of system you need has the largest impact on your total cost. The three main options are below:
Heat Pumps: Heat pumps are best for moderate climates. They handle both heating and cooling and cost, on average, between $4,200 and $8,000. Learn more about heat pump costs.
Furnaces: Furnaces are best for cold climates and only provide heating. If you need cooling in the summer, you’ll need to pair it with an AC unit. Average furnace costs range from $1,700 to $10,000, depending on size, fuel type, and efficiency. Learn more about furnace costs.
Central AC: Central AC units are essential in warmer climates. They only provide cooling and cost an average of $3,900 to $7,900. Learn more about central air conditioner costs.
Cost data includes the unit, labor, and demolition, if applicable. I gathered cost data from the RS Means construction materials and labor database.
Heat Pump Installation Costs
Basic heat pumps cost $4,200 to $8,000, while geothermal models can reach $24,500. Your price includes the unit, installation work, and removal of the old system.
Heat pumps move warmth instead of creating it. In summer, they pull heat from your house and release it outside. In winter, they grab heat from outdoor air to warm your home. They shine in areas where winter doesn’t drop below 20°F or get much warmer than 32°F. Heat pumps can pay for themselves through lower energy bills, especially in places like the Southeast, where winters stay mild.
| Heat Pump Type | Cost Range | Best For |
|---|---|---|
| Air Source | $4,200–$8,000 | Most homes in moderate climates |
| Dual Fuel | $4,200–$10,000 | Areas with occasional freezing temperatures |
| Geothermal | $4,500–$24,500 | Long-term energy savings, apt for any climate |
Check out our complete heat pump installation cost guide for a detailed breakdown of heat pump costs, installation considerations, and energy efficiency ratings.
Read More: What’s the Best Heat Pump Brand?
Furnace Installation Costs
A new furnace costs from $1,700 to $10,000, though most homeowners spend about $4,000 to $7,000 on a standard model. Your price mainly depends on the type you pick, the size of your home, and the furnace’s efficiency.
| Furnace Type | Cost Range | Best For |
|---|---|---|
| Electric | $1,700–$7,100 | Areas with low electricity rates |
| Gas | $3,800–$10,000 | Most cold-climate homes |
| Oil | $3,800–$10,000 | Areas without natural gas service |
Gas furnaces heat homes fast and run cheaper than electric ones, making them the best choice in cold areas. Electric models make sense in areas where electricity rates are low or natural gas isn’t available. Oil furnaces will work well in places without gas lines, too.
Higher-efficiency units cost more up-front but cut your energy bills. For example, an 80% AFUE furnace costs around $4,500, while a 96% model runs around $7,500.
Read our complete furnace replacement cost guide for more details on furnace options, efficiency ratings, and installation factors.
Central AC Installation Costs
A new central air conditioning system costs between $3,900 and $7,900, but high-efficiency models can cost $10,000 or more. This price includes the outdoor unit, indoor components, installation work, and the removal of your old AC unit.
The Seasonal Energy Efficiency Ratings (SEER) affect your price, too. Basic 14-15 SEER2 units cost $3,900 to $6,200. High-efficiency 20-24 SEER2 models typically run $8,500 or more but save money on your monthly bills. I recommend getting something in the middle to balance the up-front cost and energy savings.
Visit our complete AC installation cost guide for more detailed information about AC installation factors, brands, and energy efficiency options.
Other HVAC Systems & Their Installation Costs
There are many types of HVAC systems, and some are less common than others. Here are the installation costs of HVAC systems that aren’t as popular as the ones already mentioned.
Geothermal Heat Pumps
Geothermal heat pumps cost the most up-front, ranging from $4,500 to $24,500. However, they tap into steady underground temperatures to heat and cool your home, often lasting 50+ years. This means they can pay back their cost through energy savings within a single decade.
I only recommend these systems to energy-conscious homeowners and those who can afford the significant investment. If you’re moving in the next few years, opt for a more affordable system.
Ductless Mini-Split Systems
The cost of mini-splits ranges from $2,000 to $14,500 per unit. Most homes need 2–4 indoor units linked to an outdoor condenser. They work perfectly for homes without ductwork, room additions, or separate temperature zones. I suggest getting these flexible systems if you’re an apartment dweller or need to cool or heat a smaller home.
Window AC Units
Window air conditioners make the most budget-friendly option, running $450 to $750. These units cool single rooms well and are easy to install. While they cost less up-front, they use more electricity than central AC systems, only cool limited areas, and block your view out the window. They work best as a backup cooling solution or for small spaces.
If you don’t want to fully block out your window, consider a portable AC unit instead. Portable ACs work the same as window units but sit on the floor of the room. Although they do take up floor space, you’ll still be able to look out of your window. They also have comparable costs to window AC units.
HVAC Brands & Price Tiers
HVAC brands vary in price, quality, and features. Understanding how each brand stacks up will help you match your cost with the performance you need.
Premium HVAC brands include Carrier, Lennox, and Trane. They offer high-efficiency ratings, long warranties, and advanced features. In general, they cost 15%–30% more than standard brands, but they’re more reliable and more efficient, which can help lower your monthly energy bills.
Standard brands include American Standard, Bryant, Rheem, and Ruud. These midrange brands balance quality and price. You’ll get solid warranty coverage and reliable performance without premium costs.
Budget-friendly brands, including Goodman, Amana, and Coleman, focus on basic heating and cooling at lower prices. While offering fewer bells and whistles, they keep your home comfortable for an affordable price.
Working With HVAC Contractors
Almost all HVAC contractors partner with specific brands as authorized dealers. This setup guarantees proper installation and warranty coverage but limits your brand choices. For example, a Carrier dealer won’t install Lennox systems.
To get the best value for your home, follow these steps when hiring an HVAC pro:
- Get quotes from contractors representing different brands
- Compare efficiency ratings across the quotes
- Ask about maintenance costs and warranty coverage
- Look at mid-tier brands with features similar to premium ones
A good installation matters more than a brand name. A well-installed mid-unit beats a poorly installed premium one every time. Don’t forget to ask your neighbors for recommendations for local HVAC companies.
Understanding Your HVAC Installation Estimate
When you get an estimate from an HVAC contractor for a new system, it may look something like this:
ABC HVAC Company
Installation Estimate #1 for Your Name
Date: January 20, 2025
Equipment:
- 3-ton Heat Pump Unit (model #: XYZ)…………………$3,800
- Air Handler (model #: XYZ)………………………..$1,200
- Programmable Thermostat (model #: XYZ)……………….$250
Materials:
- Refrigerant Line Set…………………$200
- Mounting Pad & Hardware……………….$150
- Drain Pan & Lines……………………$100
Labor:
- System Installation (16 hrs @ $95/hr)….$1,520
- System Testing & Startup………………$285
Additional:
- Permits & Inspections………………..$350
- Old System Removal…………………..$275
- Disposal Fees………………………$150
Subtotal………………………….$8,280
Tax (6%)…………………………..$497
Total……………………………$8,777
How To Read Your Estimate
Look for model numbers and sizes with equipment costs. Labor rates usually run $75–$150 per hour. Materials cover installation needs, and disposal fees ($200–$400) cover removing your old HVAC equipment. Check that the permit fees match your local rates.
How To Spot Problems in Your Estimate
Watch for vague material descriptions or missing details. Question disposal fees above $400 and look for duplicate charges. Every piece of equipment should list a model number. Ask about any service fees without clear explanations. Make sure labor hours match typical installation times.
Other Factors That Affect HVAC Installation Costs
Here are the main factors that will affect your HVAC installation cost:
Home Size and Layout
Your home’s size significantly affects the price of your HVAC installation. Bigger homes need more powerful units to keep your home at an optimal temperature. For example, our research found that a new HVAC system for a 2,000-square-foot home typically costs $3,500–$7,700 for heating and $3,670–$4,070 for cooling, which is almost twice as much as the cost to heat and cool a 1,000-square-foot home.
Here are the cost ranges you can expect based on the size of your home:
| Square Footage | Heating Cost Range | Cooling Cost Range |
|---|---|---|
| 1,000 square feet | $3,280–$4,275 | $1,550–$2,960 |
| 1,500 square feet | $3,500–$7,650 | $2,895–$3,305 |
| 2,000 square feet | $3,500–$7,700 | $3,670–$4,070 |
| 2,500 square feet | $4,000–$7,800 | $4,075–$4,485 |
| 3,000+ square feet | $4,600–$8,100 | $5,025–$5,435 |
Multi-story homes or complex layouts might require special equipment or extra labor, which could increase installation costs by up to 30%.
Ductwork Modifications
New ductwork means your HVAC project will likely cost more. Base repairs run from $500 to $1,000, while replacing sections costs $1,500 to $5,000. Complete duct installation in a home can range from $7,000 to $15,000, depending on the home’s layout and access points.
Location and Labor Rates
Where you live affects HVAC costs due to local wages, weather needs, and general market rates. Urban installations often cost 20–30% more than rural jobs due to higher overhead and labor costs.
Your local climate also plays a role in costs. Homes in areas with cold winters and hot summers often need HVAC systems that have a higher level of energy efficiency and more BTUs, driving up the cost of the HVAC system.
Permits and Code Requirements
Local codes will affect your project costs. Building permits run $250 to $750, inspections add $100 to $300, and meeting code requirements might add $500 to $2,500. Local laws often set minimum efficiency standards that influence which HVAC system you can install, which can have a big effect on the price you’ll pay.
How To Save Money on HVAC Installation
Here are some common ways you should use to save money on your HVAC installation:
Get Multiple Quotes
Ask three different HVAC contractors for estimates. Compare equipment details, cost breakdowns, timelines, and warranties. Prices often vary from $1,000 to $3,000 for the same job—just make sure you’re comparing equal work scopes.
Install in the Right Season
Book your HVAC installation during the slower seasons, if possible:
- AC installation: October-March
- Furnace installation: March-September
- Heat pump installation: Spring or fall
Off-season installation may save you 10–20%. Plus, your HVAC contractor may be able to complete your work faster or give you better attention and focus during the slower seasons.
Look for Incentives
Look for money-saving programs—a good HVAC contractor will be able to tell you which ones you qualify for:
- Federal tax credits for efficient systems
- State/local rebates
- Utility company incentives
- Manufacturer rebates
- Contractor financing deals
Skip Upgrades
Put your money toward system quality, not extras. Skip $500+ premium thermostats and extra warranty coverage that overlaps with the manufacturer’s protection. Wait on maintenance agreements—you can add those later. Only add zone systems if your home layout demands it.
Red Flags & Common Mistakes To Avoid
Here are some red flags you should be on the lookout for:
Contractor Issues
Good contractors always inspect your home before giving you a quote. Skip anyone pushing “today-only” deals, insisting on quoting just one model, or demanding full payment up-front. Check their physical address, license, and references, and read online reviews. Get everything in writing.
Quote Warning Signs
Be wary of estimates that lack model numbers or efficiency ratings. Question labor costs burned into equipment prices. Extremely low or high bids should come with solid explanations from the contractor. “Package deals” will often include unnecessary work (but not always).
Installation Planning
Quality HVAC contractors will calculate proper system loads, pull required permits, and discuss multiple models or brands with you. They should also carefully and accurately measure spaces and address any duct problems up-front.
Contract Basics
Request written warranty terms and service agreements from the HVAC contractor you hire. Make sure they register the manufacturer warranty and look for specific completion dates and fair payment schedules.
Final Thoughts on HVAC Installation Costs
A new HVAC system costs most homeowners between $5,000 to $12,500 on average. While that’s a big investment, proper installation will improve your home’s comfort, cut your energy bills, and boost the value of your home. Smart planning will get you the best value, so make sure to research thoroughly and get multiple contractor quotes, know your current system, and compare brands, efficiency ratings, and warranties before making any decisions.
Ready for estimates? Get Free HVAC Installation Quotes from qualified local contractors.
This site receives compensation from the companies featured in this listing, which may impact where and how products appear. This listing doesn’t feature all companies, products, or offers that may be available.
FAQS
The cost of replacing your HVAC system is divided into three parts: equipment at 60%, skilled labor at 30%, and permits at 10%. You’re mainly paying for the equipment, specialized tools, licensed HVAC experts who handle refrigerant and electrical work, and local permits and inspections.
Due to supply chain disruptions, labor shortages, extreme weather conditions, and the state of global manufacturing, the cost of HVAC parts and installation can be high. Looking for incentives, proper maintenance of your systems, and finding the right professional (in the off-season) to install your system can help keep HVAC costs more manageable.
Booking your AC installation in the winter (October–March) or furnace replacement in the summer (March–September) can lower HVAC costs. Shop mid-tier brands with good features but lower prices. Call several HVAC contractors to compare quotes and check for utility rebates in your area. Passing on fancy thermostats and extra warranty coverage you won’t use can also help you save.
In most cases, your contractor removes the old system, installs new indoor and outdoor units, hooks up refrigerant lines, and tests everything to ensure it functions properly. They’ll also handle permits, program your thermostat, check your ducts, and show you how to run your new system. However, every company is different, so be sure to ask what’s included when you’re getting quotes.
Replacing an old HVAC system depends on the age and condition. Look at replacing a system that’s over 15 years old or breaks down often. New units cut energy bills by 20–40%. A high-efficiency furnace may cost $2,000 more but saves $300-400 yearly on heating. Most homeowners break even in 5–7 years through lower bills and fewer repairs.
If your AC and furnace are about the same age, change both if your furnace tops 15 years old or your AC still uses R-22 refrigerant (freon). New units work better as a pair and cost less to install together. However, if your furnace runs well and hasn’t hit 10 years, just swap the AC unit if it’s failing or old.
