Furnace Replacement Cost in 2026: What Landlords and Homeowners Actually Pay
A new furnace runs about $4,700 installed for most homes, but the gap between an entry-level gas unit and a high-efficiency one is wide. Here's how the numbers really break down.
Marcus Delgado
Home Services Writer · April 14, 2026 · 7 min read
How much does furnace replacement cost?
Typical
$4,700
Most pay $2,800–$7,500 per project
Most homeowners pay between $2,800 and $7,500 to replace a furnace, with a typical installed price right around $4,700. A basic 80% AFUE gas unit in a small house can come in near $3,000, while a high-efficiency furnace for a big two-story, plus any ductwork, can push past $8,000.
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What affects the cost
Fuel type
Gas furnaces ($3,800–$10,000 installed) are the default in most of the country. Electric runs cheaper up front ($1,000–$5,500) but costs more to run where power is pricey. Oil ($5,000–$10,000) and propane ($3,700–$14,000) show up mostly in rural and older Northeast homes.
Efficiency (AFUE)
An 80% AFUE unit wastes a fifth of its fuel; a 96–98% condensing furnace squeezes nearly all of it into heat. The high-efficiency unit costs $1,500–$3,000 more but can cut a winter gas bill meaningfully in a cold climate.
Size (BTU output)
Furnaces are sized in BTUs. A 1,000 sq ft bungalow might only need 40,000–60,000 BTU ($2,000–$4,000), while a 2,800+ sq ft house needs 100,000–120,000 BTU ($4,500–$7,500). Oversizing is a common contractor shortcut that wastes money and short-cycles the unit.
Ductwork condition
If the existing ducts are sound, you save a fortune. Repairs run a few hundred dollars; a full duct replacement adds $1,000–$5,000 and is the single biggest swing factor on a tight-budget job.
Labor and crew
Installation takes a two-person crew 4 to 10 hours, billed at $75–$150 an hour or rolled into a flat quote. Labor alone is usually $1,000–$2,500 and climbs fast in high-cost metros.
Permits and removal
Most towns require a permit ($50–$300) and an inspection. Hauling off the old furnace adds $60–$500. Skipping the permit can bite you at resale, so don't let a contractor talk you out of it.
Furnace replacement cost by fuel type and efficiency (unit plus installation)
| Furnace type / efficiency | Installed cost range |
|---|---|
| Electric furnace | $1,000–$5,500 |
| Gas, 80% AFUE | $2,500–$5,000 |
| Gas, 90–95% AFUE | $3,500–$7,000 |
| Gas, 96–98% AFUE | $4,500–$8,500 |
| Oil furnace | $5,000–$10,000 |
| Propane furnace | $3,700–$14,000 |
Cost by region
The priciest region for furnace work. Old housing stock, brutal winters that demand bigger output, oil-to-gas conversions, and high union labor rates all stack up. A Boston or Hartford job easily runs 20–30% over the national average.
Lowest furnace costs in the country. Milder winters mean smaller units, and a deep bench of HVAC contractors keeps bids competitive. Plenty of Southern homes lean on heat pumps instead, which softens furnace demand.
Moderate pricing, but the cold pushes homeowners toward larger, higher-AFUE gas furnaces. A 2,000 sq ft two-story outside Chicago or Columbus typically lands in the mid-$4,000s to mid-$5,000s installed.
Wide spread. California labor and efficiency rules run high, while the milder Pacific climate means smaller furnaces (or heat pumps). Mountain states see big units for hard winters; coastal homes often need surprisingly little.
What you're really paying for
The sticker on a furnace is maybe half the story. A mid-grade 80,000 BTU gas furnace might list for $1,500 to $2,500, but by the time a licensed crew sets it, ties in the gas line and venting, pulls a permit, and hauls the old unit away, you're looking at roughly $4,700 for a typical install.
The rest of the bill is labor, code-required parts, and whatever surprises the old setup hands you. A cracked heat exchanger on the unit you're pulling doesn't matter, but rusted-out ductwork or a flue that no longer meets code absolutely does. Good contractors flag this stuff during the estimate. The cheap ones find it mid-job and hand you a change order.
Gas vs. electric vs. oil
For most of the country, natural gas is the practical default: lower operating cost than electric resistance heat, and the infrastructure is already in the street. Expect $3,800 to $10,000 installed depending on size and efficiency.
Electric furnaces are cheaper to buy and install ($1,000–$5,500) and make sense where gas isn't available or winters are short. The catch is the monthly bill, since electric resistance heat is expensive to run anywhere power costs are high. Oil furnaces ($5,000–$10,000) are mostly a Northeast and rural story, and a lot of those owners are quietly converting to gas or a heat pump when the old burner finally dies.
Does high efficiency pay off?
AFUE is the percentage of fuel a furnace turns into usable heat. An 80% unit is the floor; condensing models hit 96–98%. The high-efficiency furnace costs maybe $1,500 to $3,000 more, and whether that pencils out depends almost entirely on your winters.
In Minneapolis or Buffalo, where the furnace runs hard for five months, the fuel savings can pay back the upgrade in a handful of years. In Atlanta, where it kicks on a few dozen nights a season, you'll likely never recoup the premium. Match the spend to the climate, not to the salesperson's spreadsheet.
A note for landlords
If you own rentals, the math shifts. You're paying the install cost but the tenant usually pays the gas bill, so the efficiency upgrade benefits them, not you, unless heat is included in rent. For a standard cold-climate rental, a reliable mid-efficiency gas furnace (90–95% AFUE) is often the sweet spot: durable, code-compliant, and not gold-plated.
One real-world example: a landlord with a 1,400 sq ft duplex unit in Ohio replaced a dead furnace with a 90% AFUE 80,000 BTU gas unit for about $4,300 installed, ducts intact. Quotes for the 96% model came in around $5,800. Since the tenant covers the gas, the cheaper unit was the right call.
When to replace before it dies on you
The worst time to shop for a furnace is the morning it quits in January, when you're cold, rushed, and at the mercy of whoever can come out fastest. Emergency replacements routinely cost more, because you've lost all your leverage to compare bids.
Watch for the tells that a unit is on its way out: it's pushing 15 to 20 years old, the burner flame is yellow instead of crisp blue, the blower runs constantly, rooms heat unevenly, or the gas bill keeps creeping up for no reason. Repair bills clustering together are the loudest signal of all. Once you're sinking a few hundred dollars into a 17-year-old furnace every winter, you're financing a replacement on the installment plan and getting nothing to show for it. Planning the swap during the off-season, on your timeline, is how you land the typical $4,700 price instead of an inflated emergency rate.
Ways to save on hvac
- Get at least three written quotes. Furnace pricing varies wildly between contractors for the exact same unit, and the spread is often $1,500 or more.
- Buy in the off-season. Spring and late summer are slow for heating work, and shops will sharpen their pencils to keep crews busy.
- Match efficiency to your climate. Don't pay for a 98% AFUE furnace if you live somewhere it barely runs.
- Keep your existing ductwork if it's sound. A duct replacement can add $1,000–$5,000, so make sure it's genuinely needed.
- Check for utility rebates. Many gas utilities offer $200–$600 back on high-efficiency furnace installs.
Frequently asked questions
How long does a furnace replacement take?
A straightforward swap is usually a one-day job, around 4 to 10 hours for a two-person crew. Add time if ductwork, gas line work, or a fuel conversion is involved.
How long should a new furnace last?
A well-maintained gas furnace typically lasts 15 to 20 years. Electric furnaces can go a bit longer since they have fewer combustion parts to wear out.
Is it worth repairing an old furnace instead of replacing it?
A good rule of thumb: if the furnace is over 15 years old and the repair costs more than a third of a new unit, replacement usually wins. Frequent breakdowns and rising gas bills are also signs it's time.
Do I need a permit to replace a furnace?
Almost always, yes. Most jurisdictions require a permit ($50–$300) and a final inspection. A reputable contractor handles this for you and folds it into the quote.
What size furnace do I need?
It depends on square footage, insulation, climate, and home layout, not just floor area. A proper contractor runs a Manual J load calculation rather than guessing. Roughly, expect 40,000–60,000 BTU for a small home and 100,000+ BTU for a large one.
Sources
- HomeAdvisor — Install a Furnace Cost
- HomeGuide — New Furnace Replacement Cost
- This Old House — How Much Does a New Furnace Cost?
- Today's Homeowner — Furnace Replacement Cost
- Fixr — Furnace Replacement Cost
Cost ranges are 2026 estimates and vary by region, materials, and contractor.
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