What Determines the Cost of a Furnace?

If you need a new furnace, you may be wondering what to expect for the price. There are so many models and types, each with different costs and ratings. But what one should you go with?

That is a very complicated question with, unfortunately, a complicated answer. Furnace cost varies so much depending on the size, efficiency, and fuel source of the unit, among other factors. Here are the factors that impact the furnace price.

Fuel Source

One of the big reasons why the cost of a furnace varies so much is because of the fuel source. The three main types of fuel are electric, oil, and natural gas.

Electric tends to be the cheapest up front but the highest cost monthly, due to electric bills. Natural gas is cheaper than oil both in upfront cost and monthly, which is why gas furnaces are increasingly more common than oil furnaces.

While one type might be cheaper than what you are currently using, the cost to switch when purchasing a furnace replacement is often incredibly high. Depending on the fuel type you’re switching to, it can range anywhere from a few hundred to upwards of $10,000.

If you have an inefficient fuel source for your home and climate, however, it may be worth the cost to switch to a more efficient option for your new furnace.

Does the Furnace Size Matter?

Bigger furnaces cost much more than smaller ones, typically in the thousands of dollars. As tempting as it is to get a smaller furnace than you need, a furnace that’s too small will struggle to heat the space required. All that work leads to extra wear and tear that can shorten the lifespan as well.

But what if you get a furnace that’s too big? Bigger furnaces will always be better, right? Well, no. In fact, furnaces that are too big often require more maintenance and don’t last as long as they should.

That’s because a too-big furnace will heat almost too well, shutting off and starting again much more frequently. All that starting and stopping leads to much more maintenance down the line, not to mention an increase in your energy bills.

Energy Efficiency

You’d think that more efficiency is always better, but if you’re looking to stay on a budget, that might not be true. Higher efficiency furnaces — those above 95% Annual Fuel Utilization Efficiency or AFUE—will cost much more upfront.

However, these costs are lessened by how much they save you monthly. A high AFUE furnace can be more cost-effective, but only if you’re planning to stay in your current home for the next 20 or 30 years.

Installation Cost

A furnace’s price tag is more than just the sum of its parts. Often, installation is included in that large price. Basically, the more labor and time that goes into installing the furnace, the more that installation is going to cost.

This is especially true if you’re installing a furnace for the first time in a new home or if you’re switching fuel sources. This cost often includes taking out previous ductwork, replacing it, and possibly repairing the drywall; that means much higher labor costs.

Brands

As in all things, there are some brands that are more trustworthy than others. It’s always recommended that you purchase a furnace from a reputable brand rather than finding a cheaper one.

Reputable brands may be more expensive, but they produce furnaces that are more reliable. Even when they do break, these furnaces are made from parts that are much easier to replace than furnaces from less known brands.

As always, it’s best to consult a HVAC expert in order to determine which brand best suits your needs.

Other Factors to Consider:

Warranty

Worried about the cost of a new furnace? Your old one may still be under warranty.

Many warranties are good for a decade, so be sure to check if yours has expired. Just remember, no warranty is valid unless it’s in writing.

Maintenance

Is monthly furnace maintenance worth it? The experts say yes.

Monthly maintenance does more than cost money. Routine cleanings can make sure that your furnace stays working properly for as long as it’s able, often up to 25 years! After all, it’s always worth it to catch small problems before they snowball into bigger ones.

Tax Credits

No matter the furnace you purchase, it would always do you well to look into the tax credits available to you. For example, if you purchased a furnace that is energy efficient (has an AFUE of over 95%) you may be entitled to a $150 tax credit.

Insulation

If your home is older or if you live in a colder climate, your home’s insulation can very easily become a problem. Faulty insulation can lead to furnaces not working properly or being significantly less efficient than they should be.

Still have questions? Contact us to set up an appointment with one of our HVAC specialists at ASI Heating and Air.