Replacing a furnace is a major home investment, but the final price depends heavily on the type of heating system, its capacity, efficiency, installation location, and the condition of the existing ductwork.
In the United States, furnace replacement generally costs between $2,000 and $10,000 or more, including equipment and professional installation. Electric furnaces are usually the least expensive to install, while oil, high-efficiency gas, propane, and complex dual-fuel systems tend to cost more.
A standard gas furnace replacement commonly costs $3,800 to $10,000, while electric furnace installation usually ranges from $2,000 to $7,000. Oil furnace replacement often costs $6,750 to $10,000 or more.
Furnace Replacement Cost at a Glance
| Furnace project | Typical U.S. cost |
|---|---|
| Electric furnace replacement | $2,000–$7,000 |
| Natural gas furnace replacement | $3,800–$10,000 |
| Propane furnace replacement | $3,500–$8,000+ |
| Oil furnace replacement | $6,750–$10,000+ |
| High-efficiency gas furnace | $5,000–$12,000+ |
| Furnace installation labor | $1,000–$3,000 |
| Old furnace removal | $100–$500 |
| Permit and inspection fees | $100–$1,500 |
| Ductwork repair | $200–$1,000 |
| New ductwork | $2,000–$5,000+ |
| Electrical upgrades | $200–$2,000+ |
| Gas line installation or modification | $300–$1,000+ |
| Furnace and central AC replacement | $8,000–$20,000+ |
These are national estimates rather than guaranteed quotes. Local labor rates, climate, equipment availability, home size, code requirements, and installation complexity can move the final price above or below these ranges.
Average Furnace Replacement Cost by Fuel Type
The fuel source is one of the biggest factors affecting both upfront installation expenses and long-term operating costs.
Natural gas furnace
A natural gas furnace generally costs $3,800 to $10,000 installed. Gas furnaces are common in areas with established utility service and cold winters.
The lowest prices normally apply to basic 80% AFUE furnaces installed with existing gas, electrical, venting, and duct connections. High-efficiency condensing furnaces cost more because they may require new PVC venting, condensate drainage, control wiring, and modifications to the existing installation.
Current national estimates also suggest budgeting approximately $400 to $1,500 for permits, inspections, removal, and ductwork integration, depending on the project.
Electric furnace
Electric furnace replacement typically costs $2,000 to $7,000, making it one of the least expensive furnace options to install.
Electric furnaces do not require combustion venting, a gas line, burners, or a flue. This simplifies installation and reduces the number of components that require maintenance.
However, electric resistance heating can be expensive to operate in areas with high electricity prices or long, severe winters. Homeowners considering an electric furnace should also compare the installed and operating costs of an air-source heat pump.
Propane furnace
Propane furnace replacement commonly costs $3,500 to $8,000 or more. The price may be similar to a high-efficiency natural gas furnace, but the property also needs a propane storage tank and fuel-delivery access.
Additional costs may include:
- Installing or replacing a propane tank
- Running a fuel line
- Converting a compatible gas furnace
- Adding regulators and safety controls
- Excavating for an underground tank
- Obtaining permits and inspections
Propane can be useful in rural areas without natural gas service, but fuel prices and delivery charges should be considered before choosing this system.
Oil furnace
Oil furnace installation generally costs $6,750 to $10,000 or more, making it one of the most expensive conventional furnace options. Oil heating remains more common in parts of the Northeast.
The project may require an oil storage tank, fuel lines, chimney inspection, burner setup, and specialized combustion testing. Replacing an aging or leaking oil tank can add thousands of dollars.
Some homeowners use furnace replacement as an opportunity to switch from oil to natural gas or a heat pump. A conversion costs more initially because the old equipment and tank must be removed and new electrical, fuel, or refrigerant connections installed.
Furnace Cost by Size
Furnace capacity is measured in British thermal units, or BTUs. Larger furnaces cost more because they contain larger burners, heat exchangers, blowers, and cabinets.
| Furnace capacity | Common home application | Typical installed cost |
|---|---|---|
| 40,000–60,000 BTUs | Small home or mild climate | $3,000–$6,000 |
| 60,000–80,000 BTUs | Average-size home | $3,500–$7,500 |
| 80,000–100,000 BTUs | Medium or larger home | $4,000–$9,000 |
| 100,000–120,000 BTUs | Large home or cold climate | $5,000–$10,000+ |
| More than 120,000 BTUs | Very large or poorly insulated home | $6,000–$12,000+ |
Home size alone does not determine the correct furnace capacity. The contractor should account for:
- Local winter design temperatures
- Insulation levels
- Air leakage
- Window size and quality
- Ceiling height
- Home orientation
- Number of occupants
- Ductwork condition
- Heat loss through walls and floors
A professional heating-load calculation is more reliable than simply installing a furnace with the same BTU rating as the old unit.
An oversized furnace may heat the home too quickly, shut off, and restart frequently. This short cycling can create uneven temperatures, increase wear, and reduce comfort. An undersized furnace may run continuously without maintaining the desired indoor temperature.
How Furnace Efficiency Affects the Price
Furnace efficiency is measured by Annual Fuel Utilization Efficiency, or AFUE. The rating represents how much of the fuel’s energy is converted into usable heat during a typical year.
For example, a furnace rated at 80% AFUE converts approximately 80% of its fuel into heat, while the remaining energy is lost through exhaust and operation.
Higher-efficiency furnaces generally cost more because they may include:
- Secondary heat exchangers
- Sealed combustion
- Variable-speed blower motors
- Two-stage or modulating gas valves
- Electronic controls
- Condensate drainage
- Advanced venting systems
ENERGY STAR-certified gas furnaces must achieve at least 90% AFUE in southern states and 95% AFUE in northern states. Certified oil furnaces must reach at least 85% AFUE and use an efficient electronically commutated blower motor.
A high-efficiency furnace is more likely to provide a strong financial return in a cold climate where the heating system runs frequently. In a mild climate, the additional equipment and installation cost may take longer to recover.
Furnace Installation Labor Cost
Professional furnace installation labor generally costs $1,000 to $3,000, although difficult jobs can exceed this range.
Installation normally includes:
- Disconnecting and removing the existing furnace
- Positioning the new equipment
- Connecting the ductwork
- Installing electrical connections
- Connecting fuel lines
- Installing or modifying venting
- Connecting condensate drainage when required
- Setting airflow and gas pressure
- Testing safety controls
- Starting and commissioning the system
A straightforward like-for-like replacement may take four to eight hours. Fuel conversions, difficult attic or crawl-space access, major duct modifications, and high-efficiency venting can extend the project to one or more full days.
Additional Costs That Can Increase the Final Price
Removal and disposal
Removing and disposing of the old furnace may cost $100 to $500. The fee depends on equipment weight, access, stairs, local disposal rules, and whether an old fuel tank must also be removed.
Permits and inspections
Furnace replacement often requires mechanical, gas, electrical, or building permits. Current national gas furnace estimates recommend allowing approximately $400 to $1,500 for permits, inspections, removal, and related integration costs, although fees vary considerably by jurisdiction.
Ask whether the HVAC contractor will obtain the permit and include it in the written estimate.
Ductwork repairs
Minor ductwork sealing or repair may cost $200 to $1,000. Installing a new whole-home duct system can cost $2,000 to $5,000 or more.
A new furnace cannot perform properly when ducts are undersized, disconnected, crushed, poorly insulated, or excessively leaky.
Gas line work
Installing, extending, or resizing a gas line may add $300 to $1,000 or more. A high-capacity furnace may require a larger supply pipe than the existing system.
Gas work should be performed by a qualified professional and inspected according to local requirements.
Electrical upgrades
A new furnace may require a disconnect, dedicated circuit, wiring, transformer, breaker, or updated control cable. Electrical upgrades can add several hundred to several thousand dollars if the home’s panel also requires modification.
Venting or chimney work
An 80% gas furnace commonly uses metal venting or an existing chimney. A high-efficiency condensing furnace normally uses PVC or another manufacturer-approved vent system.
Chimney liners, vent replacement, combustion-air improvements, and wall penetrations add to the installation price.
Thermostat replacement
A basic thermostat may cost less than $100, while smart or communicating thermostats can cost $200 to $600 installed.
Some variable-speed and modulating furnaces require proprietary controls to access their full range of comfort and efficiency features.
Should You Replace the Furnace and AC Together?
The furnace blower often moves air for both heating and central air conditioning. Replacing both systems together may make sense when the air conditioner is also old or when the new equipment must be carefully matched.
Benefits of replacing both include:
- One installation project
- Matched blower and cooling capacity
- Reduced duplicated labor
- Compatible controls
- One warranty and maintenance schedule
- Fewer disruptions later
However, replacing a relatively new and reliable air conditioner simply because the furnace has failed may not be financially necessary.
A complete furnace and central AC system can cost approximately $8,000 to $20,000 or more, depending on capacity, efficiency, equipment type, and ductwork.
Repair or Replace the Furnace?
Replacement is usually worth considering when:
- The furnace is more than 15 years old
- The heat exchanger is cracked
- Repairs are becoming frequent
- Heating bills continue increasing
- The furnace cannot heat the home evenly
- Parts are difficult to obtain
- The unit is incorrectly sized
- The repair approaches half the replacement cost
- Major duct or renovation work is already planned
A small repair may still make sense on an older furnace when the unit is otherwise safe and reliable. Thermostats, ignitors, sensors, capacitors, and switches are usually much less expensive than complete replacement.
A failed heat exchanger, repeated blower problems, or several expensive repairs in a short period often makes replacement the better long-term choice.
Are Federal Furnace Tax Credits Available in 2026?
Homeowners should not assume that the previous federal Energy Efficient Home Improvement Credit remains available for a furnace installed in 2026.
The IRS states that qualifying improvements had to be placed in service by December 31, 2025. Under current federal guidance, furnaces installed after that date do not qualify for the former credit.
State energy offices, local utilities, manufacturers, and regional programs may still offer rebates or financing for efficient furnaces and heat pumps. Verify eligibility before purchasing equipment because program funding and requirements can change.
How to Save Money on Furnace Replacement
- Replace the furnace before an emergency failure. Planned installation provides time to compare contractors and equipment.
- Get at least three written estimates. Make sure every quote includes comparable equipment and work.
- Request a heating-load calculation. Correct sizing prevents unnecessary equipment expense.
- Keep the existing fuel type when practical. Fuel conversions often require major infrastructure changes.
- Check warranty coverage. Some components may still be covered.
- Schedule during spring or early fall. HVAC companies may have more availability outside peak seasons.
- Ask about utility rebates. Local incentives may reduce the cost of efficient equipment.
- Compare complete operating costs. Consider fuel prices, efficiency, maintenance, and expected service life.
- Review financing carefully. Compare interest rates, fees, and total repayment—not only the monthly payment.
- Improve insulation and air sealing. Reducing heat loss may allow a smaller furnace and lower operating costs.
Frequently Asked Questions
How much does it cost to replace a furnace?
Furnace replacement generally costs $2,000 to $10,000 or more. Gas systems commonly cost $3,800 to $10,000, while electric furnaces generally cost $2,000 to $7,000.
How much does a new gas furnace cost?
A professionally installed gas furnace typically costs $3,800 to $10,000. High-efficiency models, large capacities, new venting, permits, and duct modifications increase the price.
How long does furnace replacement take?
A straightforward replacement generally takes four to eight hours. Fuel conversions, ductwork, difficult access, and major code upgrades may require one or more days.
How long does a furnace last?
Many furnaces last approximately 15 to 20 years. Maintenance, climate, usage, installation quality, and equipment design all affect service life.
Is a high-efficiency furnace worth the additional cost?
It can be worthwhile in cold climates with long heating seasons and high fuel consumption. Compare the higher installed price with estimated annual savings.
Does furnace replacement include new ductwork?
Usually not. Standard replacement normally connects the new furnace to the existing ducts. Repair or replacement of the duct system is typically quoted separately.
Can a homeowner replace a furnace?
Furnace installation involves fuel lines, combustion safety, venting, electrical work, airflow adjustment, permits, and carbon monoxide risks. Professional installation is strongly recommended and may be required by local codes and manufacturer warranties.
Conclusion
Furnace replacement in the United States generally costs $2,000 to $10,000 or more, depending on the fuel type, size, efficiency, labor, permits, ductwork, and installation requirements.
Electric furnaces are usually the least expensive to install, while oil, propane, and high-efficiency gas furnaces tend to cost more. A standard gas furnace replacement commonly falls between $3,800 and $10,000.
Before selecting a system, request a professional load calculation and compare itemized quotes that include equipment, labor, removal, venting, permits, controls, and required upgrades. The best value is a properly sized furnace installed safely—not simply the lowest equipment price.