If your furnace is on its last legs, the price tag on a replacement is probably the first thing on your mind. Here's what 2026 numbers actually look like, what drives those numbers up or down, and when skipping the furnace entirely for a ductless system might save you money.
Key Takeaways
A new furnace in 2026 will cost most homeowners between $3,800 and $12,000 installed for gas models, or about $2,000 to $8,100 for electric. In 2026, the average installed cost of a furnace is around $4,800, though the three factors that move that number the most are fuel type, efficiency rating and how complex the installation is.
The cost of a furnace is both the equipment cost up front and the cost of labor. Any quote that is worth comparing should break out the price of the unit, the hours of labor, changes to the ductwork, permits and electrical upgrades as separate line items. If a contractor gives you one lump number and won't list these out for you, that can be a red flag.
Here is a quick look at how a furnace project can add up against a ductless alternative:
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New furnace (gas, installed): ~$3,800–$12,000. It will need gas piping, venting and existing ductwork.
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Ductless mini split (single zone, installed): ~$2,000–$8,800. No ducts needed. It heats and cools.
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Ductless multi-zone (whole home): ~$6,500–$18,000+. This can replace both furnace and AC in many homes.
What a New Furnace Costs in 2026
Depending on efficiency and region, gas furnace prices are between $3,800 and $12,000, and the average cost to install a furnace is from $3,000 to $10,000. The cost of an electric furnace starts at around $2,000 and can go up to $8,100 for larger units. Oil and propane systems are higher still, often $5,500 to $10,000 or more once you factor in the work on the tank and venting. According to Angi's 2026 data, the average across the whole country for about 11,869 checked jobs is $4,814, with most homeowners paying between $2,823 and $6,897.
| Fuel Type | Typical Installed Cost (2026) | Typical AFUE |
|---|---|---|
| Natural gas (standard) | $3,800–$7,500 | 80–85% |
| Natural gas (high efficiency) | $6,000–$12,000 | 95–98% |
| Electric | $2,000–$8,100 | \~100% (resistance) |
| Oil | $5,500–$10,000+ | 80–87% standard |
"Furnace costs" means equipment, labor, permits, and removal of the old unit combined. Quotes that don't separate each piece make apples-to-apples comparison nearly impossible.
Furnace Cost by Type
Gas furnaces are the most common heating type in the U.S. The cost of the equipment is moderate, the price of natural gas per BTU is low in most regions, and gas furnaces usually have lower operating costs than electric models. The trade-off is that you need safe venting and often new or updated flue piping, which adds to how complex the installation is.
Electric furnaces have the lowest upfront price. There is no fuel storage, no combustion air and no venting. But in cold climates, monthly energy bills can be a lot higher because electric resistance heating costs more per BTU than gas in most markets.
Oil furnaces usually cost more than gas or electric models, both to buy and to run. They are most common in the rural Northeast, where gas lines don't reach. Installed systems are usually $5,500 to $10,000+](https://furnaceinstallationcost.com/oil-furnace-cost). Propane furnaces need dedicated storage tanks and have costs that vary depending on what the installation needs, landing somewhere between gas and oil on both the cost of the equipment and the cost of the fuel.
Best-fit scenarios:
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Gas furnaces are for cold-climate homes that already have natural gas service
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Electric furnaces work best for mild climates, smaller homes or supplemental heating.
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Oil and propane are for rural areas without gas access, so budget for higher fuel costs
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Ductless mini split heat pumps → an alternative furnace type that burns no fuel, often more energy efficient than electric resistance, and can replace or supplement a traditional heating system in many U.S. regions
Home Size and Furnace Costs
Rough BTU guidance (for reference only):
| Home Size | Climate | Approximate BTU Range |
|---|---|---|
| 1,000 sq ft | Mild | 40,000–60,000 |
| 1,500 sq ft | Mixed | 60,000–80,000 |
| 2,000 sq ft | Cold | 80,000–100,000 |
| 2,500+ sq ft | Cold | 100,000–150,000 |
A load calculation determines the appropriate furnace size. Square footage alone isn't enough. Furnace size should consider home insulation and climate, along with window quality, air sealing, and the number of stories. A Manual J calculation by a pro is the only accurate method.
Installation Costs for Labor, Materials and Complexity
Installation cost usually covers the labor of the technician, removal and disposal of the existing furnace, connection to gas and electrical, venting, minor changes to the ductwork, and permitting. How complex the installation is can increase furnace costs a lot beyond the base price of the equipment.
Labor costs for furnace installation are usually from $1,000 to $3,000. Most straight replacements are taking 4 to 8 hours. Labor costs are higher in high-wage metro areas and with emergency or after-hours calls.
What drives installation requirements up:
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Relocating the furnace (from the basement to the attic, for example) is adding duct runs and venting.
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Running new gas lines or propane supply lines costs per foot, plus permit.
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Electrical upgrades for a model with high efficiency or for a different voltage.
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Correcting unsafe or too-small existing ductwork.
Permits and inspections for installation can add $50 to $1,500 to the total cost. These fees and when you need to schedule the inspection should appear in any formal quote.
AFUE and Furnace Prices
Annual fuel utilization efficiency, or AFUE, tells you how many cents of every fuel dollar become heat that you can use. An 80% AFUE gas furnace is losing 20 cents of every dollar up the exhaust. A 96% AFUE unit is losing just four cents. A higher AFUE rating means there is less fuel waste and lower bills.
Higher efficiency furnaces usually do cost more upfront. A standard 80% AFUE furnace might install for $3,800 to $7,500, while higher efficiency units in the 95–98% range can push $6,000 to $12,000 installed. With dual heat exchangers, ECM blower motors, PVC venting and condensate drains, the extra cost covers these added parts. According to Modernize, a high efficiency model usually installs for $6,500 to $9,500+ in colder climates.
High-efficiency furnaces can have AFUE ratings up to 98.5%. Furnaces with 90%+ AFUE can save hundreds each year on energy bills, and modern high-efficiency models can reduce fuel use by 30% compared to older standard-efficiency equipment.
The payback math depends on how long you plan to stay in the home, local gas or electricity prices, and available incentives. In cold climates where you run the furnace six or seven months a year, payback on higher efficiency equipment tends to fall in the 5-to-8-year range. In mild climates, it goes longer and the savings may not justify the premium.
When to Replace Your Furnace: Repair Costs vs Replacement Costs
A usually cited rule is that if the repair estimate is more than about 40 to 50 percent of furnace replacement cost and the unit is over 12 to 15 years old, replacement usually wins on long-term value. Most modern furnaces are lasting around 15 to 20 years with proper maintenance.
Replacing a Full HVAC System with Furnace AC or Ductless Mini Splits
Many homeowners eventually face the cost of replacing both their furnace and central AC, pushing total HVAC equipment replacement into the $7,000 to $12,500 range for mid-efficiency systems, and $15,000+ for high efficiency setups in larger homes.
A ductless mini split system can replace both the furnace and AC with one set of equipment. Multi-zone ductless systems that cover a whole home usually run $6,500 to $18,000+ depending on how many indoor heads there are and how complex the installation is.
| Feature | Furnace + AC Combo | Ductless Multi-Zone |
|---|---|---|
| Typical installed cost | $7,000–$15,000+ | $6,500–$18,000+ |
| Labor needs | HVAC tech, possible gas/electric/duct work | Less sheet metal; line sets, wall penetrations, electrician for circuits |
| Efficiency | AFUE + SEER2 ratings drive bills | High SEER2/HSPF2; often more energy efficient in mild-to-moderate climates |
| Ideal for | Homes with good existing ductwork and gas service | Homes without ducts, needing zoning, or wanting to skip ductwork modifications |
Our store focuses on DIY-friendly ductless mini splits that ship with pre-charged quick-connect line sets. This can substantially reduce overall project cost because the homeowner or a handyman handles most of the work, with an electrician only covering new circuits or disconnect boxes.
What You Can and Can't Do for DIY vs Pro Installation
Most building codes and manufacturers expect gas furnace installation to be handled by a licensed HVAC professional. Combustion safety, venting integrity, gas-tightness testing and warranty concerns make professional installation the only realistic path for a new furnace installation involving gas or oil.
Pro-only project on a furnace job include gas line work, flue and combustion venting, pressure testing, electrical connections and setting up safety controls. Improper work here is really dangerous and will void warranties.
DIY-ready ductless mini split systems are working differently. Factory-sealed, pre-charged quick-connect line sets are designed to be tightened with two wrenches-no vacuum pump, no gauges, no EPA 608 certification needed. That makes them installs that are accessible to you if you are handy and want to save money on labor.
That said, Zone Air's manual states that running a new dedicated circuit, installing the breaker and connecting at the panel is licensed-electrician work in most areas and usually needs a permit and inspection, even where homeowner electrical work is otherwise allowed. Every Zone Air 2- and 3-zone system runs on a 30A double-pole 208–230V circuit, so upgrading from a single 115V room solution to a multi-zone system usually means new panel work by an electrician. You'll want to factor that into your total project cost.
When a Ductless Heat Pump Can Replace Your Furnace
A ductless mini split heat pump uses an outdoor compressor and one or more indoor heads that are connected by refrigerant line sets to heat and cool without ducts. You might choose it instead of replacing an aging furnace, especially when you need both heating and cooling upgrades.
Modern cold-climate ductless systems can heat effectively well below freezing, with some models rated to deliver full output at −13°F or lower. That makes them a realistic alternative to a gas furnace across much of the U.S. and far more energy efficient than electric furnaces or baseboard heaters.
On cost, a multi-zone ductless system installed by a contractor might run $13,000 to $16,000+. With a DIY-capable kit like Zone Air, homeowners have brought that down to the $7,500–$8,500 range by handling the mechanical work themselves and hiring an electrician only for the circuit.
Practical considerations include getting the right size for each room (BTU per zone), choosing between 115V and 230V models based on your existing electrical service, and planning the lengths and paths of the line sets. A typical Zone Air kit comes with the outdoor unit, indoor head(s), pre-charged quick-connect refrigerant line sets, communication cable and mounting hardware. The main steps are to mount the heads, set the outdoor unit, run and connect the line sets, wire the power and communication cables, and commission the system.
How to Get Accurate Quotes and Avoid Extra Charges
Checklist for contractor quotes:
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Manual J load calculation, not just a guess based on a rule of thumb
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Written range of work with model numbers and energy efficiency ratings.
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Breakdown of labor vs. equipment cost
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Clear warranty terms for parts and labor, plus coverage for the heat exchanger.
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Whether the final price includes the fees for permits and the scheduling of inspection.
FAQ on Furnace and Ductless Costs
Rebates and Tax Credits for High Efficiency Furnaces or Ductless Systems in 2026?
Federal programs change often. The 25C tax credit for certain heat pumps ended at the end of 2025, and new federal provisions may or may not have replaced it by the time you read this. State, local and utility rebates may be available for qualifying HVAC equipment, and incentives for high efficiency systems can reduce total installation costs by a lot. Rebates can vary by location, equipment and program requirements, so check your state energy office and local utility before buying.
Can You Save by Installing Your Own Furnace?
DIY installation of a gas furnace is usually not recommended. Safety risks, code requirements and warranty issues make it a non-starter in most areas. Most jurisdictions require licensed professionals for gas and venting work, and does homeowners insurance cover furnaces installed without permits? Often not.
Homeowners who want to handle more of the work themselves often choose DIY-ready ductless mini splits with quick-connect line sets, while still hiring an electrician for new circuits and panel work as required by local codes. That hybrid approach, doing the mechanical work yourself and outsourcing only the electrical, is where DIY labor savings actually happen.
Related guides
- DIY mini split buying guide: sizing, voltage and true DIY explained
- Brands with pre-charged quick connect mini splits
- Easiest DIY mini split install: how pre-charged line sets work
Specifications, prices, and warranty terms above are manufacturer- or retailer-published as of October 2026, are subject to change, and should be verified before purchase. MiniSplits on Sale is a Zone Air® dealer and is not affiliated with or endorsed by any other brand named here.