The typical installed cost of central heating and cooling ranges from $12,800 to $18,500.
When all options are considered, from entry-level equipment for small homes to high-performance heating and cooling systems for large homes, the cost spectrum is wider – $7,400 to $22,600.
There’s plenty of price information here plus system efficiency and performance details that will assist you in understanding your options.
Stating the Obvious – Prices Have Gone Up
Given the recent increases in the cost of “everything,” you might be shocked but probably aren’t surprised that central heating and cooling prices are 22% to nearly 40% higher than they were just a couple of years ago!
One large heating and air conditioning company in Arizona mentioned in a blog post that wholesale prices on the Trane equipment it buys are up 38%. Bosch systems are up 28%. Those costs – plus higher labor and transportation costs for local installers – are all passed on to us, the homeowner or property owner.
OK, let’s get on to price breakdowns and a Buying Guide that will give you the details needed to be an informed consumer.
Complete System Costs
Before detailing each of your central heating and cooling system choices, this table shows their costs for comparison.
The efficiency acronyms like AFUE and SEER are defined below.
| System Types | AC Efficiency | Sizes | Typical Cost Range |
| Split Furnace & AC | 13 – 28 SEER | 1.5 – 5 Tons | $12,800 – $17,500 |
| Split Heat Pump | 13 – 26 SEER | 1.5 – 5 Tons | $13,400 – $18,200 |
| Split Furnace & Heat Pump | 13 – 26 SEER | 1.5 – 5 Tons | $14,000 – $18,700 |
| Split AC-only | 13 – 28 SEER | 1.5 – 5 Tons | $11,600 – $15,000 |
| Package Systems | 13 – 16 SEER | 1.5 – 5 Tons | $9,750 – $14,400 |
| Geothermal Heat Pump | 26 – 64 SEER | 2 – 7 tons | $16,500 – $32,000+ |
Central Heating and Cooling System Options
There are several central heating and air conditioning options for most homes.
What they have in common is the use of a blower and ductwork to circulate air – pulling untreated air into the system and pushing treated air into the living spaces of your home.
Terminology tip: Treated air is air that has been heated in winter or cooled and dehumidified in summer.
Furnace and AC Split System
This is still the most common HVAC system type throughout the country.
Typical Cost: $12,800 to $17,500
Configuration: This split HVAC system includes a condensing unit, aka air conditioner, outdoors and a furnace inside the home.
Air Conditioning
Air conditioning is supplied by the outdoor condensing unit and indoor coil plus the furnace blower.
Refrigerant is circulated by the compressor. It picks up heat in the indoor coil and releases it through a coil in the condensing unit. Moisture condenses on the cooled indoor coil, and it is drained away. The result is cooler, drier indoor air.
Efficiency and Sizes: SEER, the Seasonal Energy Efficiency Ratio, is the efficiency rating. Today’s central air conditioners start at 14 SEER (a new minimum set in the beginning in 2023) and top out at 28 SEER. The most popular range is 16 to 20 SEER.
Residential central air conditioners are produced in sizes from 1.5 to 5.0 tons, which is equivalent to 18,000 to 60,000 BTUs.
Heat
The furnace is usually a gas furnace, though in parts of the US, oil furnaces are still common because natural gas and propane being are less available.
In warm climates, electric furnaces are a cost-effective alternative in some homes. They cost less than a gas furnace, but in most areas, electric heat is the costliest source of heating.
Efficiency & Sizes: AFUE, the Annualized Fuel Usage Efficiency, is the efficiency rating used for gas and oil furnaces. Sizes start at about 35,000 BTU; the largest are around 140,000 BTU, but it varies by manufacturer.
80% AFUE Gas Furnaces: These units have one heat exchanger and are 80% efficient, meaning 20% of the heat generated is wasted with the combustion gas exhaust. These furnaces cost less to buy, but they use more fuel than high-efficiency furnaces. As a result, they are most common in warm climates.
90% to 99% AFUE Gas Furnaces: Furnaces in this efficiency range have a second heat exchanger to maximize the transfer of heat out of the exhaust and into your home’s ductwork. They cost more, but the higher cost is usually recovered in 3-10 years in climates with colder winters.
82% to 87% AFUE Oil Furnaces: These heaters have a single heat exchanger and a narrow range of efficiency options.
*Electric furnaces are mostly produced in 10 kW, 15kW and 20kW sizes, which correspond to about 35,000 to 70,000 BTU. They claim 100% efficiency, or close to it. That means that about 100% of the electricity they consume is converted to heat. But again, generating heat from electric resistance technology is the most expensive way to do it.
Air Source Heat Pump Split System
Heat pumps are rapidly gaining market share, especially in warm and moderate climates where they are the most efficient choice. They are starting to be used more in cooler climates, too, because advances in efficiency in some models make them effective in temperatures below freezing.
Typical Cost: $13,400 to $18,200
Configuration: The system consists of a condensing unit outside and an air handler indoors.
What is a condensing unit? It is the outdoor unit for both central ACs and heat pumps. Sometimes it is referred to as an air conditioner (or AC) or a heat pump, depending on which type it is.
The difference between a heat pump and air conditioning condensing unit is that the heat pump can reverse the flow and performance of the refrigerant to both heat and cool. When cooling, it pumps heat from indoors to outdoors, as expected.
With the use of a reversing valve and related equipment, it can collect heat outdoors, carry it indoors and disperse it there to heat your home.
What does “air source” mean? The term means that they gather heat from air outdoors for heating your home and they disperse heat into the outside air when removing it from your house to cool your home. — This contrasts with geothermal (ground source) heat pump systems, which gather and dump heat below ground.
Efficiency and Sizes: SEER is the rating for air conditioning. HSPF, or Heating Seasonal Performance Factor, is the heating efficiency rating. Heat pumps start at 13 SEER and 7.7 HSPF. The most efficient available have SEER ratings above 20 and HSPF ratings of 10-13.
Heat pumps are also available in 1.5 to 5.0 tons / 18,000 to 60,000 sizes.
Terminology tip – Air handler and forced air: An air handler is like a furnace with no heating function. It contains a blower to circulate air, pulling in untreated air and pushing out treated air. This function of moving air is why these systems are also called “forced air” systems, though that term isn’t used as much as it once was.
A fan coil is a type of air handler. The air handler, like a furnace, connects to the home’s ductwork.
Dual fuel systems are rare but available. They contain a heat pump outside and furnace indoors. Carrier calls them hybrid heating systems. The furnace only provides the heating when outside temperature, aka ambient temperature, is too low for the heat pump to be efficient.
Air Source Package Systems
You’ll also see these called packaged systems and rooftop systems.
A package unit contains all moving parts of the heating and AC system in a single cabinet. The package is installed on the ground or the roof of the house and connects to the home’s ductwork system.
The installation is easier, so labor costs are less. Packaged HVAC is standard in commercial buildings, but not nearly as popular in residential applications.
Typical Cost: $9,750 to $14,400
Configurations: Packaged systems come in four configurations or combinations of equipment (see below).
Why would you use a package system? Most homeowners who choose packaged heating and cooling don’t have a basement and don’t want to give up limited living space for the inside equipment.
Another benefit of a package system is that the systems are very quiet indoors because the “stuff making noise” is outside.
Why would you avoid a package system? Efficiency is lower, and they don’t last as long because the entire system is outside and subject to the elements.
Gas package systems efficiency and sizes: These heating and cooling packages contain a gas furnace and an AC condensing unit. The furnaces are typically 80% to 82% AFUE. The SEER ratings for air conditioning ranges from 14 to 17.
System sizes are 2-5 tons. They are also called gas packs. Dual fuel systems, as explained above, containing a furnace and a heat pump, are available.
Electric package systems efficiency and sizes: Your options are heat pumps systems and AC-only systems. Heat pump package units contain a heating and cooling condensing unit and an air handler.
An AC-only system has an air conditioning condensing unit and an air handler. Efficiency for both types ranges from 14-16 SEER and up to 9.0 HSPF. Sizes are 2-5 tons.
Geothermal Heat Pump Systems
Perhaps a brief explanation will be enough here since these systems are not nearly as common as the others in the list.
The function is the same as an air source heat pump except that the heat is gathered and dumped below ground – in soil or water – instead of air.
Typical Cost: $16,500 to $32,000
Configurations: Split systems and packaged systems are produced.
The geothermal advantage: The temperature underground remains 55-60F year-round depending on your climate.
Think about it. In AC mode, heat removed from the indoor air transfers much more easily into 60F soil or water than it into outdoor air that is 85 to 110F.
And when heating, it is easier to gather heat in those below-ground temperatures than it is in frigid winter air, as an air source heat pump must.
Ground: Tubing is run in horizontal coils or deep vertical shafts. Horizontal installation costs less but requires a large lot.
Water: Tubing is run underwater in a suitable body such as a privately owned pond or in deep wells drilled on the property. Obviously, drilling wells leads to higher costs.
Water flows through the tubing. In cold climates, it contains glycol to prevent freezing. Indoors, the water travels through a coil where refrigerant extracts heat from it for heating and transfers heat into it when cooling.
Efficiency and Sizes: SEER ratings start in the mid-20s, and the most efficient have ratings in the 60s. Very impressive. But the super-efficiency comes with a very high price tag.
Geothermal systems range from 2 tons to 7 tons, or 24,000 to 84,000 BTUs.
Itemized Heating and Cooling Costs
Maybe you don’t need a complete heating and AC system?
If you’re only replacing one major component, this table gives you cost ranges for HVAC equipment replacement. Cost factors explained below will help you narrow your costs within the given ranges.
| Component | Installed Cost |
| Gas Furnace | $4,400 – $9,300 |
| Oil Furnace | $4,800 – $8,600 |
| Electric Furnace | $3,600 – $5,900 |
| AC Condenser & Coil | $5,100 – $10,500 |
| Heat Pump Condenser & Coil | $5,500 – $11,200 |
| Air Handler | $3,300 – $5,400 |
| Refrigerant Line Set | $225 – $550 |
| Thermostat | $40 – $600 |
| Gas Line | $600 – $1,500 |
| Exhaust Vent | $450 – $1,200 |
| Electrical Circuit & Wiring | $375 – $650 |
The prices include the equipment, installation supplies such as a mounting pad or bracket, refrigerant line set and refrigerant charge if applicable. Installation labor, tuning and testing cost plus the mechanical and/or electrical permit costs are included.
A gas line, vent or electrical wiring are not typically needed for direct replacement of existing equipment.
For a first-time installation or when old items must be replaced, you will incur additional costs for these items.
Installation Labor – Cost and What’s Involved
Labor costs for a complete heating and cooling system range from $2,400 to $4,600 depending on the design and complexity of the system.
The installation cost range for a single component such as a gas furnace or a condensing unit and coil is $1,500 to $2,700.
When your HVAC contractor itemizes the cost estimate, the items falling under “Labor” typically include:
Labor – Often one certified HVAC technician and a helper
Installation supplies – These include mounting equipment, refrigerant line set for an AC or heat pump, refrigerant to charge the system, furnace venting materials and miscellaneous supplies required for the work.
Cost of Ductwork
The cost of ductwork for new installation is $12 to $17 per linear foot with most homes requiring between 120 and 250 feet of ducts.
The total cost for most homeowners is between $1,500 and $4,200 based on the size and layout of your home and the type of ducts used.
The ductwork includes supply ducts carrying treated air to the rooms of the home and return ducts bring untreated air back to the system.
System Cost Factors
Apply these cost factors to the heating and cooling cost lists above. This will allow you to narrow the price estimates for your home.
Factors relate to the equipment and to the challenges of installation.
Home Size = System Size: The bigger your home, the larger the heating and AC system will need to be. Today’s average existing home is about 1,800 square feet. HVAC systems for these homes fall in the center of the ranges given above.
New construction averages around 2,500 square feet.
Climate: A large home in a very warm or very cold climate needs a much larger heating and cooling system than a smaller home in a moderate climate.
System Efficiency: The harsher your climate, the more it makes sense to choose efficient equipment – a 90% or higher furnace for cold winters and an 18 SEER or higher AC or heat pump for hot summers.
On the other hand, you won’t recover the higher cost of a 95% furnace compared to an 80% furnace in a warm climate – or a 20 SEER AC where summers are cool.
Performance: Single stage furnaces and condensing units are the most affordable and generally the least efficient. Two stage systems cost more but make your home more comfortable. And they tend to be more efficient than single stage systems.
Variable capacity systems are the most expensive but deliver the highest efficiency and most comfortable climate control. There’s an overlap in efficiency. Let’s use ACs as an example:
- Single stage ACs: 13 to 17 SEER
- Two stage ACs: 16 to 21 SEER
- Variable capacity ACs: 19 to 28 SEER
Quality: While most brands are quite similar in quality and use identical third-part internal parts, a few stand out for higher quality. And then there are definitely budget brands, too. See the Brands section below for details.
Job Difficulty: Installation in a walk-in basement or first-floor utility closet is a lot easier – and more affordable – than putting a system into an attic or crawlspace.
When you Buy: HVAC contractors used to have slow seasons when estimates got a little more competitive. Unfortunately, right now, with pent-up consumer demand and $trillions in newly printed government money in the pockets of homeowners, HVAC companies are busy all the time.
The Contractor: There are tiers of installers, and you get what you pay for. Some brands allow any licensed installer to install its equipment, and they offer the most affordable work. Other brands are choosier, requiring anyone installing their systems to have advanced certifications.
There’s an even higher tier for some brands – like Trane Comfort Specialist or Carrier Authorized Dealers – installers demonstrating premium results, often after being trained in the manufacturer’s factory.
More on Choosing an HVAC Contractor
The installer makes important decisions including equipment size and ductwork connection size, plus refrigerant line set size and length when applicable.
Then they must execute the work to exacting specifications to ensure maximum system efficiency and durability – these include charging it with the right amount of refrigerant, setting the blower speed for the “perfect” amount of airflow for your home and adjusting the burners for clean, efficient burning.
For best results, consider using a “certified specialist” of the brand you choose – or even consider choosing a different brand to get a better installer.
Heating and Cooling Brand Costs
There is very little quality difference between most brands. Rheem, Heil, Armstrong, Amana, and York are among those offering good quality.
There are a few brands with superior quality (and higher cost) like Trane and American Standard are identical brands in this tier. So are Carrier and Bryant.
And then there are a few budget brands like Goodman and Aire-Flo that give you less quality at a lower cost.
Lennox is all over the quality spectrum. We’d place their Signature Series systems – the top line – in the superior category. The mid-tier Lennox Elite equipment offers good-but-not-great quality.
And then there’s the Lennox Merit Series – some of it is cheap, definitely budget priced heating and cooling systems. The best brand rating for Lennox is 3.5 to 4.5 based on which series is considered.
| HVAC Brand | System Cost Range | Brand Rating out of 5 |
| Trane & American Standard | $9,200 – $22,600 | 4.5 |
| Carrier & Bryant | $9,400 – $21,800 | 4.5 |
| Rheem & Ruud | $8,900 – $20,800 | 4 |
| Heil, Tempstar, etc. (1) | $8,700 – $19,900 | 4 |
| Armstrong Air & AirEase | $8,700 – $19,600 | 4 |
| Lennox | $8,600 – $22,400 | 4 |
| York, Coleman & Luxaire | $8,600 – $20,600 | 4 |
| Daikin & Amana | $8,500 – $21,000 | 4 |
| Payne (2) | $8,400 – $15,500 | 4.5 |
| Ducane | $8,500 – $14,900 | 4 |
| Goodman (3) | $7,400 – $18,800 | 3.5 |
| Aire-Flo | $7,600 – $14,800 | 3.5 |
Notes:
(1): Heil and Tempstar are identical brands made by International Comfort Products, a division of the Carrier Corporation. Day & Night, Arcoaire, Comfortmaker and Keeprite are regional ICP brands that are also identical.
(2): Payne is also a Carrier brand. It offers fewer systems – most in single stage and a few two stage options. The quality is excellent, but Payne doesn’t produce high-end, variable capacity equipment.
(3): Goodman has been owned by Daikin for more than a decade. It remains a highly popular, low-cost heating and AC brand. The problem is that any licensed technician can buy it and install it. Even a homeowner can buy Goodman online and try to DIY. As a result, the long-term quality of Goodman systems doesn’t match that of most top brands.
FAQ
How much is a new heating and cooling system?
Most cost between $12,800 and $18,500. But when you consider the cheapest and smallest systems on the low end and the largest systems with premium features, the total cost range is $7,400 to $22,600.
How can I save money on a new HVAC system?
Here are the best tips for saving money on your heating and cooling system.
- Don’t buy more efficiency or performance than you need. It is not cost-effective, for example, to buy a 21 SEER, variable capacity AC in New England or a 95% AFUE furnace in Georgia. See our recommendations in a later question regarding the right efficiency and performance for various climates.
- Get estimates from multiple local installers. Let them know they are competing for the work. Check their online reviews, because you don’t want to waste money on a low-cost installer that does bad work. Choose one that you believe has a good balance between fair pricing and quality results.
How should I choose a heating and AC company?
Get competing estimates from several local dealers with a good reputation. See the answer above for details.
Can I buy the equipment and hire an installer?
Yes. But we don’t recommend that approach. First, the limited range of brands and equipment sold online or locally to homeowners without a contractor’s license tend toward the cheap end. Goodman, Airquest, Revolv… these are not premium brands! 😉
Secondly, you’ll be happier with the system if you get a contractor involved from the beginning to determine the correct system size, help you consider the right system efficiency and features for your home and select a reliable brand. Finally, buying online might void the warranty coverage on the system.
Are HVAC tax credits available?
Yes, Effective Jan 1, 2023: Non-Business Energy Property Federal Tax Credit provides a tax credit to homeowners equal to 30% of installation costs for the highest efficiency tier products, up to a maximum of $600 for qualified air conditioners and furnaces, and a maximum of $2,000 for qualified heat pumps.
Are HVAC rebates available?
Yes. Most energy suppliers give attractive rebates on energy efficiency equipment and energy saving upgrades.
ConEdison (ConEd) in Illinois is a good example. It currently offers rebates of $75 to $550 to customers that install efficient furnaces, air conditioners, heat pumps, boilers, etc. There are even rebates for smart thermostats that can be programmed for energy savings and insulation for your home that reduces heat loss in winter and heat gain in summer.
What is the right size HVAC system for my home?
Most homes need a system in the 3 to 5 tons range. For precision sizing, which is important to efficiency and reliability, ask your contractor to do a load calculation to determine the correct size for your home.
Trane has a useful guide you might find helpful for understanding heating system sizing.
What is the best heating and AC system for my home?
It varies based on your climate, home’s design, and budget. The next question addresses this issue from the climate perspective.
Does your home have ductwork? Then a standard split system makes the most sense. If you’re building a home or addition, consider a mini split ductless system or, if you love in-floor heating or don’t like forced air because of the dust and allergens it scatters, then a boiler system might be ideal.
What’s the best HVAC system for my climate?
Here are our recommendations and options:
Very warm climate HVAC: A two stage or variable capacity heat pump system with a SEER rating of at least 16. The hotter it is there, the more you should consider a unit with 18-21 SEER.
A highly efficient two stage heat pump is more cost-effective than a variable capacity model, even one with a higher SEER rating, when you compare the upfront system costs vs. ongoing operating costs for electricity.
In short, variable capacity systems cost much more and probably are not worth the money when a two-stage heat pump, AC or furnace will do.
Warm climate HVAC: Your two best options are a two-stage heat pump system or an AC with an 80% AFUE furnace. We recommend the heat pump or AC to be 16-20 SEER.
Moderate climate HVAC: You can’t go wrong with an 80% furnace and AC in the 14-18 SEER range. A mid-efficiency single-stage or two stage heat pump is a good choice too. In some regions with moderate weather, just a furnace is used.
No AC. But in the last few years, with the climate changing, some of those moderate areas like the Pacific Northwest have been hit with stretches of very warm weather that sent homeowners scrambling to have central AC installed.
Cool climate HVAC: We still think a split system with a 90% or higher efficiency furnace and an AC, if you need it, is ideal.
Cold climate HVAC: 90% AFUE or higher gas furnace, and if you want AC, a single-stage 14 to 16 SEER unit is a good value choice. Many homeowners in areas with mild summers are opting for a whole-house fan and/or ceiling fans as a budget-friendly way to stay cool on warm summer days.
Should I repair or replace my system?
If it is less than 12 years old and hasn’t or doesn’t now have major mechanical issues, repairing it is the better option. This is especially true if you plan to move in the next few years. You won’t get a good return from investing in new equipment if you sell soon.
When a system is older than 10 or 12 years and is beginning to have problems, consider replacement. If you want something more efficient or that is better sized to your home, then replacing it makes even more sense.