Furnace Replacement Cost
What a new furnace costs, and why quotes vary so widely.
Compiled by DIY Repair Guide · reviewed 2026-09-05 ·how we research these
Furnace quotes routinely arrive $3,000 apart for what sounds like the same job, and the reason is rarely that one contractor is gouging. Efficiency rating, whether the ductwork needs work, and whether a high-efficiency unit forces a new venting and condensate arrangement account for most of the spread.
Here is what the ranges look like, what each variable actually adds, and how to compare quotes that are not describing the same work.
Installed Cost by Type
All-in figures including unit, labor, standard materials and removal of the old furnace, for a straightforward replacement.
| Type | Installed range | Typical life | Notes |
|---|---|---|---|
| Gas, 80% annual fuel utilization efficiency (AFUE) | $3,000–6,000 | 15–20 yrs | The standard replacement |
| Gas, 90–96% AFUE (condensing) | $4,500–9,000 | 15–20 yrs | Needs PVC venting and a condensate drain |
| Gas, 97%+ modulating | $7,000–12,000 | 15–20 yrs | Variable-speed, quietest |
| Electric furnace | $2,000–4,500 | 20–30 yrs | Cheap to fit, expensive to run |
| Oil furnace | $4,500–9,000 | 15–25 yrs | Regional. Needs tank and flue |
| Propane | $3,500–7,000 | 15–20 yrs | Similar to gas, higher fuel cost |
| Heat pump (as an alternative) | $4,500–10,000 | 12–18 yrs | Heats and cools. Rebates often apply |
The 80% Versus 90%+ Decision
AFUE is the percentage of fuel converted to usable heat. An 80% furnace sends a fifth of it up the flue. A 96% furnace sends four percent.
The catch is that condensing furnaces above 90% cannot use a conventional chimney. They extract so much heat that the exhaust is cool and acidic, which requires PVC venting run to a sidewall and a condensate drain to carry off the water produced. If your house has a masonry chimney serving the old furnace, going condensing means new venting, commonly $500 to $1,500, and a drain route, and it may leave a water heater orphaned on a now-oversized chimney, which itself needs addressing.
The energy saving is real but not enormous in a mild climate. In a cold climate with a long heating season the payback is much stronger. Ask the contractor to quote both and to state the venting work each requires separately.
A quote for a 96% furnace that does not mention new venting or a condensate drain is either missing scope or the house already has suitable venting. Ask which. It is the most common reason two quotes differ by thousands.
Sizing, and Why Bigger Is Worse
Furnaces are sized in BTUs per hour, typically 40,000 to 120,000 for a house. Sizing should come from a Manual J load calculation that accounts for square footage, insulation, windows, orientation and climate. Not from a rule of thumb and not from matching whatever was there before.
Oversizing is the common error and it is genuinely harmful. An oversized furnace satisfies the thermostat quickly and shuts off, then restarts shortly after. That short cycling means the heat exchanger spends its life in the thermal stress of startup and shutdown, comfort suffers because rooms never reach an even temperature, and the unit wears out faster while costing more to run.
If a contractor sizes your furnace by asking the square footage and nothing else, get another quote.
| Home size | Rough British thermal unit (BTU) range | Caveat |
|---|---|---|
| 1,000 sq ft | 40,000–60,000 | Insulation and climate dominate |
| 1,500 sq ft | 50,000–75,000 | Manual J rather than a table |
| 2,000 sq ft | 60,000–100,000 | Ceiling height matters |
| 2,500 sq ft | 75,000–120,000 | Zoning may be the better answer |
What Pushes a Quote up
The unit is often under half the bill. These are what move the rest.
- Ductwork. Undersized, leaking or badly laid-out ducts will strangle a new furnace. Repairs run $500 to $2,000. A full replacement in an older home can reach $5,000 or more.
- Venting changes. Going condensing, or abandoning a shared chimney, adds $500 to $1,500.
- Electrical. Variable-speed and modulating units sometimes need a dedicated circuit or a service upgrade.
- Access. Attic and crawlspace installations cost more than a basement or utility room, sometimes substantially.
- Permits and inspection. $100 to $500 depending on jurisdiction, and worth having.
- Gas line. A higher-input furnace may need a larger supply line run from the meter.
- Thermostat. Modulating and two-stage furnaces need a compatible thermostat. A basic one will run them as if they were single-stage.
- Season. Emergency mid-winter replacement costs more, and choice of equipment narrows to what is in stock.
Repair or Replace
Furnaces last roughly 15 to 20 years for gas and longer for electric. Two considerations dominate: the age of the unit, and whether the heat exchanger is involved.
| Situation | Lean toward |
|---|---|
| Under 10 years, any repair | Repair |
| 10–15 years, repair under about $500 | Repair |
| 10–15 years, repair over about $1,500 | Get both quotes |
| Over 15 years, large repair | Replace |
| Cracked heat exchanger, any age out of warranty | Replace |
| Rising bills, uneven heat, frequent service | Replace |
A cracked heat exchanger can put combustion gases including carbon monoxide into the air circulating through the house. It is not a repair-or-replace judgement about money. The furnace should be shut down until it is resolved. Every home with a fuel-burning appliance needs working CO alarms.
Comparing Quotes Properly
Three quotes are only useful if they describe the same work.
- Insist on itemized. Unit make and model, AFUE, BTU input, labor, venting, ductwork, permit, thermostat, disposal, separately.
- Check the sizing basis. Ask whether a Manual J was done. If everyone quoted the same BTU as the old unit, nobody calculated anything.
- Compare like efficiencies. An 80% quote against a 96% quote is not a price comparison.
- Ask what the venting plan is and whether the water heater is affected by it.
- Read the warranty split. Parts warranties are typically 10 years from the manufacturer. Labor warranty comes from the installer and varies from one to ten years. That difference is worth real money.
- Check rebates. High-efficiency equipment and heat pumps frequently attract utility and federal incentives that change the ranking of the quotes.
Common questions
How much does it cost to replace a furnace?
Typically $3,000 to $6,000 installed for a standard 80% AFUE gas furnace, and $4,500 to $9,000 for a high-efficiency condensing model. Ductwork, venting changes and difficult access can add substantially.
Is a 96% efficient furnace worth the extra cost?
It depends on climate and on what the venting change costs. In a cold climate with a long heating season the fuel saving usually justifies it. In a mild climate, where a condensing unit also forces new PVC venting and a condensate drain, an 80% furnace is often the better value.
How long does a furnace last?
Roughly 15 to 20 years for a gas furnace and 20 to 30 for electric. Regular filter changes and annual servicing extend that. Short cycling from an oversized unit shortens it.
Should I repair or replace a 15 year old furnace?
At fifteen years, a large repair is usually money spent on equipment already near the end of its life. Small repairs are worth doing. Anything over about $1,500, and any heat exchanger problem, argues for replacement.
Why are furnace quotes so different?
Usually because they are not quoting the same job. Different efficiency ratings, different assumptions about ductwork and venting, and different labor warranties account for most of the spread. Itemised quotes make the comparison possible.