New Gas Furnace Prices and Installation Costs in 2020

Controlling the climate of your home during chilly months requires a heating source and way to distribute that energy. A modern gas furnace can be your best option for a home heating source. Selecting the ideal furnace for your home can be had with a few steps that we’ll guide you through.

Gas Furnace Installation Cost Information

For a fully installed furnace, plan to spend between $3,500 and $7,500 on average. The furnace units themselves are usually under $1,500. But professional installation is in your best interest, for reasons we’ll explain below. The current national average is about $5,000 for a new furnace installation.

HVAC contractors typically charge $50 to $75 per hour for their work, and may include an assistant, or team of three, to complete the job. Their helpers often earn $50 an hour as well. Installation generally requires 10 man hours at minimum, but can easily go up due to many reasons, usually related to adjusting or updating the forced air system.

If significant updates are needed to your ductwork, this can add up to $15,000 to the cost. Typically, it is under $10,000 and often these additional charges are only steep if converting from say an electric furnace to a gas one.

Other costs that may be included include paying for a permit and inspection services (check with your local municipality), removal and disposal of an older furnace, and miscellaneous materials needed to complete the installation.

Gas Furnace Prices for Top Brands

If you look just at the Energy Star list, which shows the many models on the market that have their stamp of approval (for being high in energy efficiency), you’ll see a good 30 brands. At least one of our top recommendations is not on their list, even though their models obtain an impessive 98 AFUE. Go figure!

Another thing you may not realize is that many popular manufacturers normally make more than one brand of gas furnaces, with each brand typically falling into either the basic, mid-range, or premium product category.

For instance, Carrier is considered a premium brand with reputation for reliability, while Payne is considered “budget friendly.” The technology among the devices is nearly identical. 😉

Here are the Top Five Gas Furnace Brands:

1 – Goodman – these are made by the same company that manufactures the more popular Amana brand. Goodman has basic models that come in at 80 AFUE and high efficiency models with up to 98 AFUE.

Warranties range from 20 years (for basic models) to lifetime (for premium models). You may not find the latest and greatest features in their lineup, but the ones we’ve mentioned are available. And most importantly, they are affordable, ranging from as low as $400 (for their electric furnaces) to $2,100 for the highest premium (gas) model.

You can reasonably plan to spend $800 to $1,500 for a Goodman furnace, though this doesn’t include installation.

2 – Day & Night – again made by the same company that makes Carrier and Bryant brands. While the external structure looks different from the other brands made by the same manufacturer, the inner technology is nearly identical.

Similar to Goodman, these too achieve up to 98 AFUE, have 20 year warranty, and features that rival premium brands, such as modulating heat.

Like Goodman, they lack on reputation, but not on quality.  You can reasonably plan to spend $850 to $1250 for a Day & Night furnace, not including installation.

3 – York is a long established brand. York also makes Coleman, and Luxaire.

York warranties range from 5 years to lifetime depending on the model. They have multiple offerings in their furnace lineup ranging from the 80 to 98 AFUE.

York basic model is affordable at around $900, but their mid-grade and premium jump to $1,500 or more.

York furnaces have a reputation for having noisier than average equipment, though their technology has evolved to include noise dampening features.

4 – Trane and American Standard are sister products. Both are on the premium side of brand names.

Trane is considered a top choice on the commercial product line of furnaces and thus their technological prowess is well known. For residential, they are pricier than our top two choices.

Trane AFUE goes up to 97.3, while they never skimp on features in their lineup. You can plan to pay $1,400 and up for a Trane furnace, not including installation.

5 – Carrier rounds off our list based mostly on their reputation for reliability. They are another premium brand and arguably over priced considering what Day & Night is offering.

Carrier AFUE ranges from 80 to 98, and their features are essentially identical to the Day & Night offerings. Still, there are many thousands of satisfied Carrier customers who enjoy having a unit that will last 20+ years.

Plan to spend $1,350 and up for Carrier furnaces, not including installation.

One final note, you can plan to spend more for installation on premium brands than the more affordable brands.

Part of this is the prestige factor that comes with being a ‘certified brand seller’ and the fact the market for premium furnaces allows for greater markup on those units.

Thus a Day & Night basic furnace may cost around $2,000 installed, while the lowest you’ll likely find the Carrier basic model installed is $3000.

Simplify The Process By Finding The Right Installer

While it’s tempting to save on labor costs, the idea of making the installation of a new furnace a DIY project is strongly recommended against.

Contractors routinely report receiving calls for repairs on ‘defective’ parts in the first 5 years of a newly installed furnace. And over 50% of the time the actual problem was improper installation or lack of maintenance.

Repairs can be expensive from hundreds to even thousands of dollars, unless the product is under warranty. And a manufacturer’s warranty may be void if the installation is not done by a licensed professional.

The service life of modern furnaces is 15 to 30 years. Any problems with operation before the first 10 years ought to not be met with a full replacement unless there is truly a defective part that is critical to the system.

Therefore, part of what you are paying for in the above figures is the warranty. Manufacturers will vary their warranties, usually based on quality of the product. Premium furnaces will garner the highest warranties which are ‘lifetime’ or usually up to 30 years.

Typically, warranties range from 5 to 10 years. Contractors offer an additional warranty that cover any item outside the unit itself, thus connections they and that relate to the forced air system. These warranties are usually 1 to 5 years.

Warranties and proper installation are worth the extra costs, but aren’t the only reasons to select a contractor. Following this section is information about how to go about selecting the ideal furnace for your home.

There are many factors to consider regarding your home, many manufacturers to choose from, and then each of those has models with different features to decide upon.

You can spend 100% of your time reviewing that information and doing all the necessary homework yourself, or you can spend 70% of your time finding a suitable contractor who will take over that process and include you in on the key decision making process.

Though, DO spend 30% of your time familiarizing yourself with the market, the features and how to find the best contractor for the job. Once the furnace is installed, maintenance becomes the key to ensure longevity of the unit.

Being able to accurately troubleshoot any problems that arise is the difference between an informed decision and being taken for a ride by a cheap contractor out to make a buck because you don’t know any better.

Questions To Ask Your Installer

After you’ve networked with friends and family about HVAC contractors they’ve worked with, and have narrowed your list down to say five to ten potential workers, you’ll seek to get multiple quotes.

Three quotes is the suggested minimum. More than seven is overkill. Besides getting the bottom line price for completing the project, there are questions you’ll want to have an answer for, to ensure you’re on top of the ongoing maintenance game. These may include:

  • Are you loyal to one brand for installation?
    • Ideally, you’ll want an HVAC technician that will install any model that appeals to you. Often however, HVAC contractors are certified sellers of particular brands. If you have a brand you know you want, this may lead to the ideal contractor. If you are open to more options, then this can work against you as the other brands will likely be downplayed in favor of their allegedly superior product.
  • What is your experience with furnace installations?
    • Several ways to ask this, and up to you how much you wish to follow up on this. Perhaps you’ll do some homework to see if there are any complaints on them, or what their BBB rating is. You mainly want to understand how well they will do a proper installation.
  • Please explain the warranty information to me.
    • Contractors will provide documents that spell this out in fine legal details, but best if they can explain it to you up front. Having them explain it like you are a young adult is beneficial down the road so you can hopefully remember what is and isn’t covered in terms of repairs and replacement.
  • Are you licensed and insured in my city?
    • This will also be the time to discuss local permits and inspections that are needed. The need for that is on you, not the contractor, but since they do this for a living, they’ll be able to clue you into that information.
  • Is the model you are suggesting new or older?
    • Newer models are less tested than older models. While older models may be less efficient. Perhaps follow up and ask if there are any known reliability issues if it is an older model.
  • Are there any tax credits or rebates available for any of the models you are suggesting?
    • This alone can’t be the deciding factor for which furnace you select. But it certainly is nice to know you may get money back based on going with a particular model.

Those are the main questions you’ll want to ask. After reviewing the Selection information below, perhaps others that make sense to you will come up. Don’t hesitate to ask them in your quest to find the ideal contractor for installing your new furnace.

Selecting The Best Furnace For Your Home

There are essential five main components that go into selecting a furnace for a home. These include the fuel type, efficiency, performance, cost and size. To arrive at some of these decisions, a number of items about your home and existing layout is necessary to make an informed decision. The pros call this a Manual J (Load) Calculation. — Often contractors will include this information in some fashion in with their quotes.

Manual J (Load) Calculation takes into account data regarding your foundation type, roof type, the geographical climate, insulation of your home, house size, and other variables. The main items are size of your home in terms of floor space to be heated, desired efficiency level, furnace size and ideal temperature you’ll seek to maintain.

Furnace Selection Among Fuel Types

Coal and wood were once the normal fuels for heating homes. Now they are obsolete. Oil furnaces are nearing extinction, and are so rare, none of them are included in our list at the end.

Natural gas is the most common type of furnace in America as it is the most efficient fuel for heating homes that are subject to very cold winters.

Electric furnaces are the next most popular option. They are usually less expensive than their gas counterparts and easier to install. Yet, they fall short on efficiency for heating in cold weather. Costs go way up under such conditions. Yet, for mild winters where temperatures may dip into the 40’s, they are worth considering.

Eco-friendly alternatives exist currently, but are higher upfront cost. Solar can easily cost $10,000 to get an array that would produce sufficient energy for lights and basic appliances.

For the demands of a furnace, it is likely too costly given how low the cost for natural gas is comparatively. With that said, gas prices could go up over the next few decades which would make the buyer of alternative energy as a heat source look very wise for making such a decision as early as this year.

Furnace Selection Among Efficiency Rating

Time to familiarize yourself with the Annual Fuel Utilization Efficiency rating, or AFUE for short. You’ll see this number on all gas furnaces you consider going forward. It’s usually a double digit number that translates into how much fuel in the furnaces is actually used for heating the home. 100% is not possible as some energy is released to preserve usable energy.

High efficiency furnaces operate at 96%, or higher. If a premium model is what you seek, that’s what you can expect to see.

80% and higher is the minimum for modern furnaces or those produced since 2013. Older models, particularly before 2000, will be lower than 80%.  An upgrade to higher efficiency translates into lower energy bills.

Furnace Selection Among Performance / Features

A basic furnace is known to operate in a single stage setting with single speed blowers. Basically it runs either on (it’s only ‘stage’) or off.  Due to temperature fluctuations, with the single speed blowers, it may be noisier at start up and shutting off. This makes it less operationally proficient and increases wear and tear.

Mid-grade furnaces include two-stage performance. This means it can run at low capacity (first stage) much of the time, and when extra heat is called for, it enters a second stage setting to meet the demand. With the feature known as multi-speed or variable speed blowers, this produces quieter output and overall better temperature flow.

Premium furnaces have the two stage performance and multi-speed blowers that the mid-grade options posses, plus additional options. Modulating heat raises and lowers temps in tiny increments, thus making them the quietest furnaces on the market.

Air Filtration utilizes an electrostatic filter to trap particles and dust, making for even cleaner air distribution. Though outside of those with asthma or lung problems, this is not really all that necessary.

Also there is the Zone Heating feature that relies on an extravagant system of numerous thermostats and a series of dampers to manage airflow throughout the living space. For a larger home, this may make great sense. — For open-concept or smaller homes, it is unlikely to be all that effective.

Speaking of thermostats, that’s an item that will likely come up for replacement at time of new installation. If the previous thermostat was geared toward managing temps in a single-stage performance unit, and the new one relies on dual-stage performance, that would be reason alone to upgrade the thermostat.

There are also programmable thermostats ($15 to $125) that allow you to schedule how warm the home ought to be, and when (both time of day and day of week). Further there are now Wi-fi programmable thermostats ($135 to $400) that allow you to monitor and adjust furnace settings remotely, or when you are away from home.

Furnace Selection Among Size / BTU 

Size of the furnace is often a first consideration as that, along with AFUE rating are the driving factors for cost. It’s really the most basic feature to understand the BTU output and thus choose the size that is truly most appropriate for your home.

General rule is plan for 30 to 60 BTU’s per square foot of whatever living space you wish to control the climate. And the more precise number is based on region you live in (within the U.S.).

Warmer climates, such as Florida, Texas and much of California can typically work with 30 to 35 BTU’s, while extremely cold climates (like northern most states in the U.S. need the 50 to 60 BTU’s to operate sufficiently.

So say you calculate 2000 sq.ft., and you’re in the norther climate, thus 60 BTU’s per hour needed. This totals to 120,000 BTU capacity, yet you wouldn’t actually seek a machine that comes in right at 120,000 since the AFUE rating will detract from the total.

If you purchase a furnace with say 90 AFUE, that means the BTU output is closer to 108,000. Thus not sufficient enough for your home. While a 140,000 system would be.

More often than not, contractors are going to go with a device that is over the minimum needed than under. It is partially based on the AFUE calculation above, but as there are umpteen other factors to consider during the Manual J Calculation, those too weigh into the final determination.

Also, if upgrading the size because the older model you had was known to be under heating the home, then this could impact how ducts are adjusted.

The more heat energy being blown through your forced air system, the larger your duct pipes ought to be. If slightly more, the same ducts are likely suitable. If significantly more, a new network may need to be installed. The DIY’er may skimp on this type of decision thinking it trivial. The pro would never view it as an insignificant detail. 😉

Furnace Selection Among Costs

With all the above options in mind, you can rightfully assume there are models that are more affordable than others. Some of the lower cost options deal with the fact it is strictly a basic (single stage) furnace that is at the minimum 80 AFUE. But there are certainly standard, or mid-grade, models that are identical in features to some premium models and the only viable difference is the brand name.

For a gas furnace, you can plan to spend between $750 and $1400, with the average being closer to $1200. For an electric furnace, the range is $400 to $1200, with average around $675.

While installation costs do add a good $1000 or more to the overall price, you are clearly getting something in return as we’ve noted. But if you look at all of the thousands of models of furnaces on the market, you’ll see the premium brands are aiming to charge you say $500 more for what is otherwise identical equipment.

The return on investment is really you paying for perceived additional reliability and really for greater reputation. But any machine not properly installed will run into problems sooner than later.

And virtually all modern furnaces when properly installed ought to get 10 years service life at minimum assuming they are well maintained.

The ROI Factor

A return on your investment is challenging to gauge when it comes to a furnace purchase. Every home buyer today expects a home will have some sort of heating source in a climate that has even mild winters. And bells and whistles on a device doesn’t translate into greater value, such as air filtration system.

At best, you can probably expect to recoup 50% of the overall spending for your furnace upgrade. Less if you go with a more basic unit that didn’t really address the forced air system.

The Wi-Fi programmable set up, with a premium model that is still within its first 10 years of service is where you could reasonably expect to obtain a 50% return on the investment at the time of sale of your home.

But the warranty is the way you do return on the investment. The greater the length of the time on the warranty, the better the initial investment. Add in higher efficiency which translates into lower utility bills each month, and there’s your true return on investment.

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