A furnace keeps your home warm by blowing heated air through ducts. The average cost to install a furnace ranges from $3,290 to $5,360, including materials and labor.
Your project may cost as little as $1,800 if you have a small home that doesn’t need much heating power, but if your home requires new ductwork or presents other complications, the total cost would be significantly higher.
The prices in this guide are based on average furnace costs from different locations across the nation, including small towns and large cities. What you pay will depend on the type, size, and brand of furnace you choose.
Cost by Location
Furnace installation costs vary depending on where you live. Labor charges are higher in areas where the cost of living is higher. So, homeowners living in metropolitan and urban areas pay more than those in rural areas.
Climate also affects the cost. In the South, winters are mild, so homeowners can opt for electric furnaces or models that aren’t particularly powerful. In the North, where temperatures drop and snowfall is common, you’ll need a more robust gas furnace, which will incur higher installation costs (especially if your home isn’t located near a natural gas line).
Here’s a quick look at average furnace installation costs in cities across the U.S.
| Location | Average Furnace Installation Cost (Including Labor and Materials) |
| Northeast U.S. | |
| Pittsburgh, PA | $3,234 – $5,270 |
| Boston, MA | $3,546 – $6,745 |
| New York, NY | $3,857 – $6,465 |
| Southeast U.S. | |
| Dothan, AL | $2,923 – $4,720 |
| Ellenwood, GA | $3,001 – $5,195 |
| Sarasota, FL | $3,079 – $4,740 |
| Midwest U.S. | |
| Columbus, OH | $3,110 – $5,240 |
| Minneapolis, MN | $3,390 – $5,625 |
| Chicago, IL | $3,546 – $5,730 |
| Northwest U.S. | |
| Corvallis, OR | $3,157 – $4,905 |
| Seattle, WA | $3,623 – $5,530 |
| Southwest U.S. | |
| Salt Lake City, UT | $3,001 – $5,035 |
| Denver, CO | $3,079 – $5,360 |
| Copperpolis, CA | $3,390 – $5,210 |
Cost by Power Source
The cost to install a furnace depends on the type. Gas furnaces are the most common type in the U.S., but the best option for your home depends on your location and the availability of fuel.
| Furnace Power Source | Average Cost (Including Materials and Labor) |
| Electric | $2,100 – $7,000 |
| Natural Gas | $3,600 – $10,000 |
| Propane | $3,350 – $13,500 |
| Oil | $6,200 – $10,000 |
Electric Furnaces
Electric furnaces are the easiest and least expensive to install. They don’t need a fuel line or storage tank and require little maintenance. However, they take longer to heat a home and can raise your monthly electric bills. These are best for areas with mild or short winters.
Gas Furnaces
Gas furnaces are the most widely used and are generally considered the best option for areas with harsh winters. They run on natural gas, but some models can be converted to propane. They heat homes quickly and work well in cold climates. While installation can be costly, they are usually the cheapest to run. You’ll need a gas line, and there’s a very small risk of gas leaks.
Propane Furnaces
Propane furnaces are similar to gas furnaces but use propane stored in a tank instead of natural gas. These are a good option if your home isn’t connected to a gas line. They heat quickly but require regular fuel deliveries and a storage tank, which can add upkeep.
Oil Furnaces
Oil furnaces are more environmentally friendly than gas, but are less common today. They require a tank to store fuel on-site and necessitate regular refills. They tend to cost more to install and run. These are usually found in older homes or places without access to natural gas.
Cost by Home Size
The size of your home affects how much heat your furnace needs to produce, which is measured in BTUs (British Thermal Units). In technical terms, a BTU is a unit that measures the energy required to raise the temperature of 1 pound of water by 1 degree Fahrenheit.
The larger the home, the more BTUs you’ll need. The more BTUs you need, the more expensive the furnace will be. Other factors like the number of windows, insulation quality, and local climate also affect how many BTUs are required.
See the table below to get an idea of the recommended BTUs and the furnace installation costs based on home size. On average, you can expect to pay between $1.30 and $2.20 per square foot.
| Home Size (in square feet) | Furnace Size (in BTUs) | Average Furnace Cost (Including Materials and Labor) |
| 1,000 | 30,000 – 60,000 | $1,600 – $2,500 |
| 1,500 | 45,000 – 90,000 | $2,200 – $3,670 |
| 2,000 | 60,000 – 120,000 | $2,680 – $4,380 |
| 2,500 | 75,000 – 150,000 | $3,330 – $5,500 |
| 3,000 | 90,000 – 180,000 | $3,890 – $6,250 |
| 3,500 | 105,000 – 210,000 | $4,2000 – $7,000 |
| 4,000 | 120,000 – 240,000 | $4,800 – $8,000 |
| 4,500 | 135,000 – 270,000 | $5,400 – $9,000 |
| 5,000 | 150,000 – 300,000 | $6,000 – $10,000 |
Cost by Brand
As with any product, certain brands’ furnaces will cost more than others. Units from more expensive brands might have exclusive features, higher quality construction, or greater name recognition and credibility. You will have to look into the specific brands you’re interested in to find out exactly what they offer.
Some of the most popular and reputable makers of furnaces include Trane, American Standard, Bryant, Carrier, Lennox, Rheem, Heil, Goodman, Maytag, Armstrong, and York.
See the table below for furnace costs from various brands that are sold on e-commerce websites like Lowe’s and Home Depot:
| Brand | Price Range (Furnace Only) |
| Goodman | $1,110 – $2,995 |
| MRCOOL | $1,145 – $2,670 |
| Winchester | $1,230 – $1,910 |
| Royalton | $1,410 – $2,635 |
| Rinnai | $1,425 – $2,690 |
Cost of Labor
HVAC professionals typically charge between $78 and $140 per hour. On average, it takes around 10 hours for pros to remove the old furnace and install a new one. If you need the installation done after regular business hours, expect to pay an extra fee for after-hours service.
Labor costs can increase if the job is more complex. This can happen if the furnace needs to be installed in a tight space like an attic or crawlspace, or if the existing ductwork needs to be adjusted. Costs may also increase if the ductwork needs to be changed or if electrical or gas line work is required.
Other Factors That Affect Cost
Many other factors impact the overall installation cost. Below are the most common factors:
Tax Credits and Rebates
Some states and utility companies offer rebates if you choose an eco-friendly furnace. Consult your state’s laws and your utility company’s policies to determine if you’re eligible.
To receive these credits or rebates, you must select an ENERGY STAR-certified furnace. In the southern U.S., where winters are not too cold, models with an AFUE rating of at least 90% are suitable. The standard is higher for northern states, where a furnace needs a 95% or higher rating to qualify.
Using a “green” energy source, such as geothermal or solar, may also qualify for credits, rebates, or other incentives. Again, it depends on where you live and your utility company.
Permits
You might be required to pay for one or more building permits to install a new furnace. The kind of permit you need and its cost will depend on the city, county, and municipality ordinances.
Typically, a new furnace permit costs between $280 and $1,100. The permitting process typically includes the cost of an HVAC inspection of your system. Your HVAC pro should be able to help you navigate the permit process. They may even handle the whole thing and add the permit fee to your bill.
Furnace Removal
If you’re getting a new furnace, the old one will need to be taken out. Most people hire an HVAC contractor or a junk removal service. On average, you can expect to pay between $60 and $300 for furnace removal, depending on your location and the size of the furnace.
Variable Speed Furnaces
Most basic furnaces have a single-stage blower. That means it’s either on or off—no middle setting. Some models have a two-stage blower, which can run at low or high power depending on how much heat your home needs.
A variable speed furnace gives you much more control. It can adjust to many different levels instead of just one or two speeds. These are more efficient and can lower your energy bills over time. However, they cost more upfront than standard models.
Efficiency
All furnaces have an annual fuel utilization efficiency (AFUE) rating, regardless of the power source, which ranges from 1 to 100. That number indicates the percentage of the furnace’s total energy usage that it converts to heat output.
For example, a furnace with an AFUE rating of 90% uses 90% of the energy it burns to heat your home, while the other 10% escapes as waste through the chimney, ducts, pipes, or other outlets.
The higher a furnace’s AFUE rating, the more energy efficient that furnace is. The higher the efficiency, the higher the furnace cost.
All new furnaces must now have an AFUE rating of 78% or higher. Currently, the lowest efficiency units on the market have a rating of approximately 80% to 89%. Modern models with AFUE ratings of 90% are considered mid-efficiency. High-efficiency models with nationwide ENERGY STAR certification have ratings of 96% or higher.
FAQ
No, installing a furnace is not a DIY job. It’s a complex project that needs professional knowledge and training. Furnace installation involves gas lines, electrical work, and proper venting. If something goes wrong, it could lead to fire, gas leaks, or carbon monoxide problems.
Common indicators that you’re due for a furnace replacement include:
• Your furnace has needed two or more repairs in two years
• Energy bills are skyrocketing
• Uneven heating or failure to reach the set temperature
• Short cycling (when the unit turns on and off strangely often)
• Banging or other unusual noises coming from the unit
• Smell of burning plastic or metal
• Smell of gas
How long your furnace lasts will depend on the furnace type. In general, this is how long you can expect each furnace type to last if you take good care of it:
• Gas furnace lifespan: 20 to 30 years
• Electric furnace lifespan: 15 to 25 years
• Oil furnace lifespan: 15 to 25 years
A furnace heats air and blows it through ducts to warm your home. A boiler heats water and sends it through pipes to radiators or baseboards in each room. A heat pump transfers heat from the ground, air, or water outside your home to the inside of your home.
Keep Your Home Warm and Comfortable
Furnaces are one of the most common methods for heating homes, particularly in areas with cold winters. They provide even heating and can be paired with your existing ductwork and thermostat for easy control.
For any furnace-related services, hire a licensed HVAC pro to ensure everything is installed safely and up to code. Home Gnome delivers the best home service experience at the click of a button. Book reliable, skilled HVAC services and leave the rest to us.
Main Image: Residential basement gas furnace with ductwork. Image Credit: J.A. / Adobe Stock
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