Here's the Total Cost of a Furnace

How much does a furnace cost? Indianapolis area homeowners often wonder the cost of a furnace when they need a replacement. No one wants to spend too much on a furnace, but many do because they don’t know the ins and outs of furnace replacement. Luckily, there are a few tips to keep in mind.

In Indianapolis, Indiana, Williams Comfort Air helps homeowners find the right furnace at an affordable price. We cover some of the most common furnace types as well as how efficiency impacts the cost. The labor cost adds to the overall price, so we go over how those expenses contribute too. 

Types of Furnaces

There are three main types of furnaces. Each have their own price points. Furnace cost depends on the type in most cases, as well as other factors. Some are more expensive than others. Additionally, certain types cost more to maintain. It all depends on how you want to spend your money. 


As the most common kind of furnace, a gas furnace uses natural gas to warm your home. In areas with heavy snowfall and cold winters, these furnaces are more prevalent. In general, the gas furnace cost is less than other types. Additionally, problems are less frequent, and minor issues are easy for homeowners to troubleshoot on their own. 

Gas furnaces last about 10 to 20 years. Over those years, you shouldn’t need to replace the furnace unless a major issue occurs, as long as you’re maintaining it properly. Of course, this saves you money in the long run. Although, the cost of gas does hike up your expenses over time. It’s less expensive to buy gas than electricity, but it does have negative environmental impacts. 

As for the negatives, homeowners must keep a close eye on their furnaces when they run on gas. Because of its flammability and combustibility, any leaks are incredibly dangerous. Plus, there is a higher risk for carbon monoxide leaks. If your home doesn’t have a gas line already, installation requires this extra step to complete.

In general, the cost ranges in the lower thousands with installation.


Electric furnaces are reliable options for those in areas without harsh winters. These are not as common as gas furnaces. Because they run on electricity instead of gas, they have a harder time with large spaces and can take a longer time to heat your home. However, in places without extremely low temperatures, this isn’t too much of an issue.

In general, the furnace cost for an electric model is less than gas furnaces. The unit ranges in price in the low thousands. However, the electric furnace costs more in utilities and maintenance. Most of the time, homeowners troubleshoot issues with their electric furnaces and call their HVAC repair company for complicated fixes. Plus, electric units are available in high-efficiency models and are better for the environment, with less direct carbon emissions. 

On the other hand, electricity gets expensive if you use the heater more than you expect. For example, if you experience an uncharacteristically cold winter, your bills skyrocket. However, they do last between 20 and 30 years, which is more than the gas furnace.


Lastly, oil furnaces are the most expensive to purchase and install. The furnace cost ranges from low thousands just for the unit to high thousands for the unit and installation. Oil furnaces are rare in the modern age because of their negative impact on the environment. Additionally, the cost of oil only raises each year as the supply depletes.

These also have a short lifespan at 16 to 20 years. However, oil is less flammable —an obvious benefit over natural gas. Still, the oil costs are important to consider when both gas and electric units cost less to maintain. 

When you consider your furnace cost, take into consideration the type of furnace you purchase. The upfront costs are important but also consider how much upkeep costs and if the unit lasts a long time. As gas and oil become harder to access, the prices increase. Additionally, think about your furnace’s impact on the environment as a whole. 

Furnace Cost and Efficiency

When furnaces are efficient, they cost less in the long run as operating costs are kept low. The furnace cost refers to much more than the installation and unit price, so take the efficiency into consideration when you pick a furnace. In general, electric furnaces are more energy efficient because they don’t use gas or oil. However, depending on your location, electricity potentially costs more than gas. 

Here’s how to ensure efficiency for any kind of furnace. 

  • Stay current. Replace your furnace as soon as you reach its expected service life or experience major issues. New models almost always have more efficient technology than older ones. This means your new furnace automatically is more efficient than your previous one. Maintain old systems too – technicians provide ways to increase efficiency as the unit ages. 

  • Use electricity where possible. Your furnace doesn’t need to be exclusively electric to implement electric additions. For example, pilot lights are able to have electric ignition. This eliminates the need for a continuous pilot light. 

  • Sticker price. In general, units of any type with a high initial cost are more efficient than lower-cost furnaces. Though unfortunate, efficient parts and units are more expensive to produce, which means you pay more for the furnace. However, if you don’t mind the upfront furnace cost, you benefit from the energy efficiency a costly unit provides. 

  • Check the size. Do you know the right size furnace for your home? The size impacts the efficiency of the furnace. If the furnace is too large or too small for your space, then it uses an unproportionate amount of energy to heat the home. This raises the cost of your utility bill and wastes energy. 

Labor Affects Furnace Cost

Labor costs fluctuate from company to company. However, the prices are usually by the hour and per technician. The amount of labor the technician does depends on the quality of the old system, the number of repairs for ductwork, and more. Some of the labor costs are below. 

  • Time spent. The overall furnace cost depends on how long the process takes to complete. Remember, the technicians need to remove the old unit before they install the new one. This time is part of the time spent. Again, each contractor charges differently, but most use an hourly model. 

  • Duct repairs. If the ducts need work, the technician takes care of it for an additional cost. However, if the ducts need repairs, the technician usually must perform the repairs before they install the new system. This means you have to include the repairs in order to install the new furnace. 

  • Number of techs. The contractor typically sends one or two technicians to your home for the installation. Fewer people on the job means you pay less for the labor. In most cases, contractors use an hourly model, but they also factor in how many workers are on the scene. For example, the hourly rate for one contractor is $75, but if a second contractor comes, they are an additional $50 an hour. Of course, the exact prices change for every contractor.

  • Warranties. Warranties are an essential part of the furnace cost. They ensure you have coverage if something goes wrong with the unit during the warranty term. The manufacturer’s warranty also adds to the overall cost. This ensures you have coverage if the system breaks down unexpectedly.

  • Size of the unit. If you purchase a bigger or smaller furnace than your original furnace, then it costs more to install. When the unit size changes, often the ducts need to change, too. The technician needs to resize the rest of the parts to fit the new system, which adds to the cost of parts and the hourly rate. 

  • Disposal. Lastly, disposal of the old unit has an additional cost. The disposal of the unit itself has a separate price. If you want the technician to take the old unit away for you, they usually charge.

Miscellaneous Costs

The furnace cost also accounts for extra parts the tech needs on the job and support services after installation. However, these are usually optional. Ask your technician about any additional costs for parts or labor before the job starts and as it progresses. You want to make sure you and your technician are on the same page about the repairs and replacements to avoid any surprise expenses. 

  • New thermostat. A new thermostat adds to the overall cost but boosts the efficiency of the system. You pay for the new thermostat and the time it takes to install it. The type of thermostat determines the price. Some reach a few hundred dollars. Ask the technician about different types of thermostats to choose the best option for your home. 

  • Maintenance. Finally, regular maintenance is an additional annual fee, but service ensures you don’t pay for surprise replacements or repairs. This is an ongoing cost over the life of your furnace, after installation. The cost of maintenance checks is far less than repairs, so this expense is well worth your money.

The Furnace Cost Basics from Williams Comfort Air

Your furnace cost doesn’t need to break the bank. The technicians at Williams Comfort Air talk through all your options so you make the best decision for your home. Do your own research as well to learn about all the different kinds of furnaces.

In Indianapolis, Indiana, call our technicians for help with furnace installation. We diagnose your issue, see if repairs are possible, and then perform replacements if necessary. Call us today to learn more!

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