How Much Does It Cost to Replace a Furnace and Air Conditioner?

AC and furnace replacement is a terrific upgrade, with associated costs being the primary concern for most homeowners. Still, few homeowners can provide a rundown of the costs of replacing an HVAC unit. However, this information is critical to making educated decisions and preventing future surprises.

This post, compiled by our HVAC experts at Conejo Valley Home Services, walks you through virtually everything you need to know about HVAC replacement costs. Let us dive right in.

When It’s Best to Replace Both Your AC and Furnace

Below are the circumstances to consider a combo furnace/ air conditioner replacement:

» When Upgrading AC Efficiency

Your air conditioner and furnace have separate compartments but share the blower motor (fan). This component, which is usually part of the furnace, facilitates proper airflow to the heat exchanger and evaporator coil. It also blows conditioned air throughout your home.

Suppose you upgrade to a high-efficiency air conditioner (with a 16+ SEER rating), but your furnace is old with an old blower motor. You only end up with a mismatched system with lower-than-expected efficiency. You also increase the risk for system issues, including premature failures. So, consider furnace repair/replacement, too, when upgrading to an AC with a SEER rating over 16.

» If Both Units Are Old

Furnaces lose their efficiency and reach the end of their serviceable life after 15-30 years, compared to 15-20 years for air conditioners. In general, ACs wear out sooner than furnaces.

Energy Star recommends replacing the cooling unit after ten years and the furnace after 15 years. So, if you install the two units simultaneously, the furnace will likely need replacing five years after air conditioner replacement. Similarly, if your furnace is less than ten years old, you may be better off holding an upgrade until your next AC replacement.

» Limited Future Financial Capacity

Are you retiring soon? Do you have major projects coming up? If you think you will not be in a position to finance air conditioner or furnace replacement in the next five or so years, consider replacing both units now. By doing so, you can focus on other projects without worrying over HVAC replacements or expensive repairs.

Factors Affecting Cost of an AC + Furnace Installation

» Efficiency Rating

SEER and AFUE are among the most critical considerations for HVAC units.

SEER (Seasonal Energy Efficiency Ratio) measures the cooling power of an air conditioner throughout an average cooling season. It is the ratio of the unit’s total cooling output (measured in BTUs) to its electrical energy consumption (measured watts-hours).

Expressed as a percentage, AFUE (Annual Fuel Utilization Efficiency) compares the amount of heat your furnace delivers to your home and the amount of fuel it requires to do the work. An AFUE of 80% means that eight-tenths of every BTU energy used to run your furnaces returns to your home in the form of heat.

The higher the SEER or AFUE rating, the more energy-efficient and expensive the HVAC unit. However, the extra cost is typically paid through lower energy consumption and bills.

The AC efficiency (SEER) should not significantly exceed the furnace’s (AFUE); otherwise, the system with much lower efficiency will hamper the other unit’s efficiency.

» Unit Size

When we talk about the size of an HVAC unit, it is more about the heating or cooling capacity than the physical size. However, there exists no one-size-fits-all heating or cooling unit.

Buying an appropriately sized unit means more cost savings on installation, repairs, and energy bills. Installing an oversized or undersized system sets the stage for a dramatic increase in energy bills, frequent system repairs, and shortened unit lifespan. So, have a reputable HVAC contractor determine your home’s heating and cooling requirements when considering air conditioner and furnace replacement.

Tonnage and BTU output are the main ratings for HVAC unit sizes.

Tonnage measures the amount of cooling an AC can provide per hour. Typical ratings range between 1.5 tons and 5 tons.

BTU output measures the amount of heat a furnace can provide in a given time. Typical ratings range between 35,000-100,000 BTUs. One BTU is equivalent to the energy generated by a matchstick.

Generally, the higher the tonnage and BTU output, the more installation costs you will incur.

» System Features

Additional cost considerations for furnace + air conditioner replacement include the technology you choose for your unit. The more premium features you pick, the higher the expenses. Such innovations include:

Noise reduction technology: Some HVAC units incorporate compressor insulation, noise-reducing fan blades, dampening strips, and furnace cabinet insulation to suppress noise.

Variable-speed technology: In heat pumps and air conditioners, variable speed tech means that the compressor can adjust its speed depending on the cooling or heating demand- reduced capacity during cooler days or full capacity on hot summer days. Also available are variable speed blower motors, which run at various speeds to control the amount of air flowing in your home. This feature is more energy-efficient and cost-saving than single-speed counterparts.

Smart thermostats: They can integrate with home monitoring services and adjust the interior temperature with zero human intervention. That means you can create pre-determined routines for your thermostat.

» Your Choice of HVAC Contractor

We get it! You want to save as much as possible on your next air conditioner and furnace replacement project. However, cheap could prove to be expensive when it comes to HVAC projects.

Abnormally cheap services could indicate mediocre installation, which might set you up for frequent repairs and high energy bills.

A reputable HVAC contractor will likely charge higher prices. However, you enjoy the peace of mind that the pro will handle your project to your satisfaction and comply with industry standards and federal/local code.

But the question is, how do you choose a reliable heating and cooling contractor? Keep in mind the following pointers:

• Ask friends or relatives to recommend an HVAC provider that completed their project on time, within budget and is well-versed with the local HVAC requirements.
• Verify the license and liability insurance coverage of the contractor you are vetting.
• Request and verify references. Ask the contractor to provide at least three references. Call the past clients and ask about the contractor’s project performance and delivery.
• Ensure the company has at least five years of experience providing HVAC services in your state/city.
• Check what previous customers say about the contractor on review sites such as Yelp and BBB.
• Obtain estimates in writing. Also, ask your preferred HVAC contractor to draft a written contract that you both review and sign before the work starts.

Common Air Conditioning Costs & Accessories

» Physical Parts

Physical components required to install an air conditioner include:

• Indoor Evaporator Coil – Consists of copper tubes that hold the cold refrigerant used to air condition your home.
• Outdoor Pad – A piece of material installed underneath the central AC to prevent pest infestation and minimize the unit’s vibration against the surface (helps prevent buzzing noises and physical damage).
• Outdoor Disconnect – Also known as AC switch/fuse box, air conditioner disconnect is a pull-out or enclosed biological growthed case that houses the AC’s electrical controls, including fuses and breakers.
• Copper Line – Connects the outdoor air conditioner to the indoor evaporator coil.
• Electrical Conduit – To connect AC to the disconnect
• PVC Pipe – To serve as a drain line

» Local Permits, Tax Credits, and Rebates

Local permits are an essential part of air conditioner replacement. Installing an HVAC system without the documents could result in legal liabilities should a building department representative uncover any code violation. It could also mean hiring contractors to re-do the project, this time with the appropriate permits. Avoid such inconvenience by obtaining all necessary permits from your local city or county building department before installing your AC.

Local utility rebates may be available on air conditioners and furnaces. Some product manufacturers offer rebates on whole system installations; however, you need to install the thermostat with the system.

Also offered are federal energy tax incentives for energy-efficient HVAC systems. Learn about the incentives available in your state here.

» Electrical Costs

HVAC installations demand expertise in various fields, including plumbing, electrical work, and carpentry. Talking of electrical modifications for AC systems, you may need to install:

• Wiring for a new thermostat
• High-voltage wiring and breakers at the electric panel that will serve your new AC

You cannot afford to ignore the risks of DIY electrical works, from potential electrical fires to electrocutions. What’s more, you could risk the quality and efficiency of the installation and the cooling unit. For these reasons, leave any high-voltage work to a local, licensed and experienced electrician.

» Ductwork Modification Costs

Because different air conditioners have varying requirements, you may need to modify your existing ductwork to meet new airflow specifications. Existing ductwork that was wrongly sized for a previous system could also necessitate the upgrade. Issues related to improperly sized ductwork include:

• Cold and hot spots in your home
• Increase in energy costs
• Shortened unit’s lifespan

» Line Set Protection

A line set is the copper tube facilitating the movement of refrigerant between the indoor and outdoor compartments of your AC unit.

Line set protection and insulation keep the refrigerant cool, which means more comfort in your home. It also protects your line set against weather elements, including UV rays. Additionally, a well-installed cover also helps keep rodents and insects away from your property.

» Condensate Drainage

As the air conditioner cools the air passing over the evaporator coil, the excess atmospheric moisture condenses. The condensed water vapor collects into drops that are too heavy to remain suspended in the air. The drops form the condensate, which drains into the sump pump, floor drain, or standpipe.

Because obstruction can interfere with the drainage process, you may need to install a condensate pump to remove the condensate water.

Typical Cost of an Air Conditioner Replacement and Furnace Replacement

The costs of replacing an air conditioner and furnace vary widely, depending on the brand and other factors we highlighted earlier.

Depending on your needs and budget, you may consider any of the following AC categories:

• Entry-level: ACs in this category offer single-stage cooling. Consider this option if you are on a budget or planning to relocate soon.
• Mid-range ACs: They offer two-state cooling and higher efficiency. This could be your best bet if you intend to stay in your home long-term.
• High-end ACs: They offer variable-speed cooling and are ideal for addressing multiple problem areas in your home.