How to Budget for a New Furnace and AC Unit: Factors to Consider

Are you wondering how much a new furnace and AC unit might cost you? Picture this: it’s a scorching summer day, and your old AC unit decides to call it quits. Cue the panic! In this article, we’ll break down the costs of getting a new furnace and AC unit for your home.

Imagine having a reliable heating and cooling system that keeps you comfortable year-round without breaking the bank. That’s where we come in! We’ll guide you through the pricing factors and options available, so you can make an informed decision that fits your budget and needs.

Factors that influence furnace and AC unit costs

When considering the cost of a new furnace and AC unit, various factors come into play. Understanding these influential factors can help you make informed decisions tailored to your needs and budget.

  • Type of Unit: Different furnace and AC unit types come with varying price tags. For example, high-efficiency models generally cost more upfront but can result in long-term savings on energy bills.
  • Size of Your Home: The square footage of your house impacts the size and power requirements of the HVAC system. Larger homes typically require more powerful (and hence more expensive) units to effectively heat and cool the space.
  • Energy Efficiency Ratings: Units with high Energy Star ratings may have a higher initial cost but can save you money in the long run through energy efficiency and reduced utility bills.
  • Installation Complexity: Factors like ductwork modifications, accessibility of installation areas, and the need for permits can influence installation costs. Complex installations may require more labor and resources, increasing the overall price.
  • Additional Features: Upgrades such as smart thermostats, zoning systems, and air purifiers can enhance comfort and indoor air quality but also add to the total cost of the HVAC system.
  • Local Labor Rates: Labor costs for installation can vary by location. Areas with higher living expenses or high demand for HVAC services may have higher labor rates, impacting the overall cost of the project.
  • Warranties and Maintenance Plans: Opting for extended warranties or maintenance plans can add to the upfront cost but provide long-term peace of mind and potential savings on future repairs.

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Considering these influential factors can help you navigate the cost considerations of purchasing a new furnace and AC unit.

Average cost of a new furnace

When budgeting for a new furnace, the average cost typically ranges between $2,500 and $7,500. Several factors influence the final price, so let’s break it down for you:

  • Single-stage furnaces are more affordable, priced around $1,500 to $3,500. They operate at full capacity, which might lead to slightly higher energy bills.
  • Two-stage furnaces, offering better efficiency, range from $2,500 to $5,500. They adjust heat output based on your needs, potentially saving on energy costs.
  • High-efficiency furnaces with an AFUE (Annual Fuel Utilization Efficiency) rating of 90% or more are pricier, averaging $3,500 to $7,500, but they can significantly lower your utility expenses over time.

Consider the size of your home, preferred energy efficiency, and local labor rates when estimating the cost of your new furnace installation.

Average cost of a new AC unit

When considering the average cost of a new AC unit, you can expect to pay between $3,000 and $7,000, with the total cost dependent on various factors. Factors that influence the price include the unit’s size, efficiency rating, and the complexity of the installation.

Here are some key points to keep in mind regarding the cost of a new AC unit:

  • Basic AC units typically start at around $3,000, offering standard efficiency levels and cooling capacity suitable for smaller homes or apartments.
  • Mid-range AC units, priced between $4,000 and $6,000, provide increased efficiency and cooling power for medium-sized homes.
  • High-end AC units, costing $6,000 and above, offer top-of-the-line efficiency and advanced features, ideal for larger homes or those seeking maximum comfort.

Understanding your specific cooling needs, energy efficiency goals, and budget constraints will help you make an informed decision when selecting a new AC unit. Keep in mind that proper installation is key to ensuring optimal performance and longevity of your air conditioning system.

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Total cost of installing a new furnace and AC unit

When budgeting for a new furnace and AC unit, it’s essential to consider not just the initial purchase price, but also the installation costs. Here are some key points to keep in mind when calculating the total cost:

  • Average Costs: The total cost of installing a new furnace and AC unit typically ranges from $6,000 to $12,000. Keep in mind that these numbers can vary based on the brands chosen, additional features, and your location.
  • Factors Influencing Cost: Factors like the type of system, unit size, energy efficiency ratings, and installation complexities can all impact the overall cost of the installation.
  • Professional Installation: While it might be tempting to cut costs by attempting a DIY installation, it’s highly recommended to hire a professional HVAC technician. Proper installation is crucial for the optimal performance and longevity of your new system.
  • Get Multiple Quotes: To ensure you’re getting the best value for your investment, consider obtaining quotes from multiple HVAC companies. This can help you compare prices, services offered, and warranties provided.

Remember, investing in a new furnace and AC unit is not just about the upfront costs but also about the long-term efficiency and comfort they can provide for your home.

Choosing the right furnace and AC unit for your needs

When selecting a new furnace and AC unit, it’s essential to consider various factors to ensure they meet your specific requirements. Here are some key points to guide you in making the right decision:

  • System Type: Decide whether a split system, packaged unit, or ductless system suits your home layout and heating/cooling needs.
  • Unit Size: Opt for a unit size recommended by professionals based on your home’s square footage and insulation levels to avoid inefficient operation.
  • Energy Efficiency Ratings: Look for units with high ENERGY STAR ratings to save on energy bills and lower your carbon footprint.
  • Installation Complexities: Anticipate any unique installation challenges in your home that could affect the overall cost and timeline.

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Consider these aspects when choosing your furnace and AC unit to ensure optimal performance and lasting comfort in your home.


That’s it! By taking into account the factors discussed, you’re well on your way to selecting the ideal furnace and AC unit for your home. Remember to consider system type, unit size, energy efficiency ratings, and installation complexities to ensure maximum comfort and efficiency. Making informed choices tailored to your needs will not only enhance your living space but also contribute to energy savings and a greener environment. Happy shopping for your new HVAC system!

Frequently Asked Questions

1. Why is it important to consider system type when choosing a new furnace and AC unit?

Choosing the right system type ensures optimal performance based on your heating and cooling needs, whether it’s a split system, packaged unit, or a ductless mini-split.

2. How does unit size impact the efficiency of a furnace and AC unit?

Selecting the correct unit size is crucial to avoid energy wastage or inadequate heating and cooling. An incorrectly sized unit can lead to higher utility bills and decreased comfort in your home.

3. What role do energy efficiency ratings play in selecting a furnace and AC unit?

Energy efficiency ratings like SEER and AFUE indicate how efficiently the unit converts energy into cooling or heating, helping you save on utility costs and minimize environmental impact.

4. Why is it essential to anticipate installation complexities when choosing a new system?

Anticipating installation challenges can prevent delays and extra costs. Factors like ductwork modifications or specific requirements must be considered to ensure a smooth and efficient installation process.

Charlie Thomson is Appliance Mastery's expert on laundry appliances. With a degree in mechanical engineering and over 8 years of experience in the appliance repair industry, Charlie is a go-to resource for homeowners who want to tackle common issues with their washing machines, dryers, and dishwashers.

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