2023 Gas Furnace Prices, Installation, Pros & Cons

A reliable and efficient furnace is key to having a comfortable and warm winter, without breakdowns and service calls, and without spending a fortune on installation and fuel costs.

On average, homeowners spend $4,160 – 5,730 to install a new gas furnace.

If you are ready to replace your old furnace, contact your local HVAC pros for FREE ESTIMATES!

How Much Does A Furnace Cost?

Overall furnaces prices depend on the spec of the furnace that you choose, as well as the local labor rates in your area to install a furnace.

Furnace prices range from as low as $1,450 to as much as $3,900+ depending on the furnace BTUS and AFUE ratings, manufacturer, and factors like blower motor type and number of stages in the burner.

The average furnace installation cost is $1,820, bring the total furnace installation cost to $3270 – $5,720

Labor Cost To Install A Furnace

Now let’s see how much it costs the HVAC contractor to install your system.

A typical installer well get a salary of $35-$45 per hour. Contactors also pay TDI and Social Security tax on top of the salary, as well as workers compensation insurance, and most will offer benefits such as health and retirement contribution.

After all the perks and extra costs, a furnace installer costs about $60-$70 per hour, and most contractor’s hourly rate is $100-$125 per hour.

It takes a crew of 2 workers about 2 days (7 hours each day) to install the unit, and make sure everything works properly, or 28 total man-hours.

Thus we get $1680 to $1960 in labor related costs. Let’s use average of $1820.

Overhead & Profit This is where good contractors make money (including to be able to stay in business, and be available to service your system, if the need arises), and not so good ones, barely stay afloat or go under.

Managing costs, is unique and different for every contractor, but as a contractor myself, I usually target at least 30-35% of the project total to be profit & overhead.

Keep in mind that contractors need to pay taxes, insurance, truck, office and warehouse expenses, advertising, etc.

The actual overhead and profit for most contractors is about 24-28% of the project total.

What Is The Best Gas Furnace?

Many homeowners, when shopping for a new furnace, may be overwhelmed by numerous product options as well as the technical jargon.

However the most confusion comes from a wide spread of prices.

You may get quotes ranging from $4,000 to over $10,000 from different HVAC contractors. You will then have a hard decision to make: install a budged furnace or go all out with “best of the best”.

In this Gas Furnace Pricing Guide we will discuss different furnace options available, and will attempt make it simple for you to make a buying decision – whether to pay more for an Ultra High Efficiency (95% or more), or go with a true and tested standard efficiency (80% AFUE).

Whether to go with a well known (and more expensive) brand like LENNOX, or with more budget option like GOODMAN or YORK, etc.

We will also explain in simple terms the difference between Single-stage, Two-stage and Modulating furnaces, ECM and multi-speed blower motors, standard and high efficiency furnaces, etc.

The goal of this guide is to make you comfortable making a furnace buying decision, and help understand what you are getting, as well as figuring out the price structure of installing a new furnace, in less than 15 minutes!

What is AFUE Rating of a furnaces?

Throughout this guide, you will see “AFUE” mentioned a lot. But what is it? AFUE stands for Annual Fuel Utilization Efficiency… We think that word “annual” does not belong here, because furnaces only run in the winter (for most people).

Basically AFUE is a measure of furnace’s efficiency, or how much of the energy is turned into usable heat.

For example, in a 80% AFUE furnace, 80% of energy becomes usable heat (warm air), and the remaining 20% goes out the chimney. In the same manner, a 97% AFUE furnace has a loss factor of only 3% that escapes out the exhaust pipe.

PRO TIP: If you have an 80% AFUE furnace, 20% of the heat is lost through the chimney. Therefore, it is ideal to upgrade to a 95% AFUE or higher. Then your heat loss will be 5% or less and your energy bill will see a typical reduction on 15% or more!

NOTE: AFUE does not account for heat loss in the ductwork, which according to US Department of Energy can be as 35%. Basically, if you want to minimize losses, it’s not enough to just get 97% efficient furnace and call it a day, if you have leaky, uninsulated ducts.

It is best to also insulate, or replace your ducts.

Single Stage vs Two Stage Furnace

Single stage furnace has a burner that operates in only one mode, and that is 100% output. This means that your furnace will cycle On & Off more frequently, with more noticeable indoor temperature swings.

Two stage burners can operate at 100% or 60% flame, and when they run in the lower output, they run longer (using less gas), and provide more comfortable and continuous heating, with fewer On/Off cycles.

There is also a Modulating burner technology, which has a wider range of outputs and is more flexible. However, these furnaces are most expensive, and may not be necessary for most people.

We will consider materials, labor and HVAC contractor’s overhead + profit, to see how these installation prices come about.

Cost of Goodman vs Lennox Furnace

Let’s look at a typical 100K BTUs output GAS furnaces. We will compare 80% AFUE, 96% AFUE and 97% AFUE systems made by GOODMAN (a common name in many homes) and LENNOX – a well know brand, that is often “sold” through big-box retailers like COSTCO and Lowe’s.

Notice they all come with an ECM motor, which has become a standard a few years back, but has some issues (reliability and replacement cost being most notable).

You can still find a single-speed, variable speed or 3-speed blower motor furnaces from manufacturers like AirQuest and others, but they are less common than ECM blowers. While ECM motors are more common today, it does not necessarily mean they are better.

Additionally, most high efficiency furnaces today come with a 2-stage or Modulating burners, which can adjust the flow of gas, thus increasing or decreasing the flame, based on the heat load that.

Goodman Furnace Cost

Goodman furnace prices are for 100K BTUs of input, and output is calculated by multiplying input by furnace efficiency. For example, a 100K BTU furnace with 96% AFUE, has maximum output of 96,000 BTUs.

Therefore it is important to consider your home’s heat load, as 80% AFUE furnace with 100K BTUs rating, will only produce 80,000 BTUs of usable heat, and 20K BTUs is lost in the chimney as exhaust gas.

Thus if your home need 95K BTUs, you will likely need to go up to 120K BTU 80% furnace, while a 100K BTU, 96% AFUE furnace will be sufficient.

	80% AFUE	96% AFUE	97% AFUE
MODEL #	GMES80	GMEC96	GMVM97
STAGES	1-stage	2-stage	Modulating
BTUs	100K	100K	100K
BLOWER	ECM motor	ECM motor	ECM motor
VENTING	Chimney	Direct	Direct
COST	$1,103	$1,776	$2,802

As you can see right away, the 97% AFUE system is almost 3 times the prices of an 80% AFUE furnace.

But why is there a 40% price difference between? This is primarily from using a modulating burner, vs a 1/2 stage, and is a lot more flexible in how much gas is being burned, based on load – compare this to a car transmissions (4-speed manual, 5-speed automatic and a CVT).

Let’s say you are choosing between an 80% and 96%, as these are the most commonly installed units in today’s market.

Your material costs are the cost of the unit, and some additional parts that (venting, condensate pump, etc), that will range between $200 and $500. We will use a $300 figure which is typical, and include a 6% sales tax.

We have $1,487 for the 80% furnace and $2,200 for the 96% unit.

Lennox Furnace Costs

Lennox furnaces don’t follow conventional 40/60/80/100/120 K BTUs capacity designations. Therefore we will use 110K BTU Lennox furnaces for comparison.

Additionally, Lennox offers a 98.1% AFUE furnace, which costs $3,989, and is a bit on “crazy” price tag in our opinion, and is hardly any better than the 97.5% unit.

They also have a 96% AFUE unit that is Single Stage, and comes with a Constant Torque Blower (pretty basic, right?!) … and this furnace costs a whooping $2,757. So we used a more advanced 2-stage, ECM blower model for our comparison table below.

Overall, Lennox furnaces are pretty expensive, except for the single-stage, constant speed blower, chimney-vented 80% AFUE unit.

	80% AFUE	80% AFUE	96% AFUE	97.5% AFUE
MODEL #	ML180UH110E60C	SL280UH110V60C	EL296UH110XE60C	SLP99DF110XV60C
STAGES	1-stage	2-stage	2-stage	Variable
BTUs	110K	110K	110K	110K
BLOWER	Constant Torque	Variable (ECM)	Variable (ECM)	Variable (ECM)
VENTING	Chimney	Chimney	Direct	Direct
COST	$1,210	$3,085	$3,186	$3,557

Once again, after you add additional components (about $300) and sales tax, a benchmark 96% AFUE furnace, we arrive at $3,588 for materials.

Finally, most Lennox are compatible with their high efficiency Central Heat Pumps, and are “dual fuel” capable.

This means if outdoor temperatures are above 38°F, the combo will provide heating using the Heat Pump, and once temperatures drop, the heat will come from the Gas Furnace.

This fuel source switching happens automatically, and is actually very economical in locations with low cost of electricity (most mid-west and southern states).

Final Cost of Replacing a Furnace

Let’s add up materials, labor, and add 33% profit/overhead. Keep in mind than many LENNOX dealers participate in some kind of advertising program, such as selling through COSTCO, Lowe’s, etc, and thus have to include a “marketing” fee into their price quote.

This marketing fee is paid to the big-box stores, for the right to be exclusive installer in that store.

Therefore, together with significantly higher equipment costs, LENNOX costs will almost always be higher than your typical heating contractor.

Here is a table of approximate costs of installing an 80%, 96% and 97% furnaces made by Lennox and Goodman:

	80% AFUE	96% AFUE	97% AFUE
GOODMAN	$4,648	$5,718	$7,349
LENNOX	$5,303	$8,260	$8,872

Bottom line – going with a brand like Lennox will almost always cost you more. The good news is – if you want LENNOX, get Armstrong Air!

Both brands (Armstrong & LENNOX) are made by the same company, and are nearly identical. Since Armstrong is not part of LENNOX sales machine, it can be purchased by most plumbers / heating contractors, and installed without any restrictions, for much less!

Not knocking down the Goodman brand, but a friend of mine has Goodman furnace that runs terrible.

It will go into HYPER mode for two minutes, and then sit idle for 10 minutes, while everyone inside the house is freezing. Actually I think this is mostly an issue of improperly setting the unit up, and not the problem of Goodman.