Most new heating and cooling systems cost $16,000 to $18,000 this year. Premium systems can cost more than $24,000.
Price hikes of more than 20% have hit the HVAC industry over the last few years – Trane is up 25% after announced increases each of the last two years. Add to that increased costs for local installers, and the consumer is paying at least 30% more.
Buy now or wait? Will prices fall to more “normal” levels if you wait a year or two to buy? Will it pay off to pour money into an old system to keep it going in the meantime?
We’re not optimistic. The best advice is probably to buy a system now, because your dollars are losing value with each passing month. 🙁
This guide is focused on the cost of central heating and cooling systems, and explaining the top available options. Our goal is to help you get a system with the best return on investment, meaning you won’t spend more upfront than you can recoup through lower energy costs or go too cheap (inefficient) and get burned by high operating costs, since energy prices are rising, too.
How Much Does an HVAC System Cost?
Each type of central heating and cooling system is explained below with pros and cons, cost factors and best uses.
This HVAC system cost comparison shows price ranges based on system size, performance, and efficiency. They are listed by popularity – a central AC and gas furnace remain the bestselling heating and cooling system.
E.R. = Efficiency Rank among the system types listed.
|System||Average Cost||Sizes||E.R.||Full Cost Range|
|AC & Furnace||$16,500||1.5 to 5.0 Tons||5||$11,500 – $23,000|
|Heat Pump & Air Handler||$17,200||1.5 to 5.0 Tons||4||$11,900 – $23,500|
|Heat Pump & Furnace||$18,500||1.5 to 5.0 Tons||3||$12,800 – $24,500|
|Gas Package||$10,500||2.0 to 5.0 Tons||7||$8,600 – $13,800|
|Electric Package||$11,700||2.0 to 5.0 Tons||6||$9,100 – $15,000|
|Mini Split||$13,900||.5 to 7.0 Tons||2||$3,100 – $26,000|
|Geothermal||$27,500||2.0 to 7.0 Tons||1||$18,000 – $40,000|
Average cost: These are heating and cooling prices for an average-sized system installed, which is 3-4 tons for an AC or heat pump and 80,000 to 100,000 BTU for a gas furnace where applicable.
Systems Explained – Pros, Cons, Efficiency and Best Return
If you’re not familiar with any or all the systems in the list, here are briefs on each.
Air Conditioner and Furnace
This split system remains a bestseller across the US.
Configuration: A condensing unit outside (aka, the air conditioner) with a gas furnace indoors. An indoor coil is housed in or adjacent to the furnace. In the northeast, oil furnaces replace gas furnaces in many homes.
AC efficiency: The current low-end is 13 SEER, but that jumps to 14 SEER as the minimum for manufacturers in 2023. The most efficient units are mid-20s in SEER – up to 28 SEER.
Furnaces: Gas furnaces are produced in two ranges. 80% efficient furnaces – 80% AFUE – have a single heat exchanger and are ideal for warm climates because they cost less and aren’t used as much, so lower efficiency isn’t a major negative.
Condensing furnaces have a second heat exchanger to capture more heat before it escapes with the exhaust gases. They range in efficiency from 90% to 99% AFUE. Oil furnaces range in efficiency from about 81% to 87%.
Pros & Cons: Upfront cost is lower for this system type than for air source and geothermal heat pumps. Efficiency is higher than with packaged units. These split systems can be quite durable – lasting 15 to 25 years. The downside is that a gas furnace’s operating costs are higher than for heat pumps for comparable efficiency levels.
Best Use: Homes with existing ductwork, especially where winters come with long stretches of freezing temperatures.
Most Popular System and Cost: A 100,000 BTU two stage gas furnace combined with a 3 ton (36,000 BTU) two stage AC costs $13,500 to $17,000 depending on the cost factors listed later.
Heat Pump and Air Handler
Heat pump technology already dominates global heating and air conditioning, and the various heat pump system types are rapidly becoming the top choice in the US.
Configuration: A condensing unit outside and air handler indoors that also contains auxiliary/emergency heat strips from 5 to 20 kilowatts. The air handler contains the indoor coil and a blower to circulate air in ductwork. The refrigerant flow and operation can be reversed.
When cooling your home, it carries heat from indoors and dumps it outside. By reversing the process, the unit can absorb heat outside and carry it indoors for heating.
Efficiency: 13 to low-20s for cooling SEER. Heating efficiency ranges from about 8.0 to 13.0 HSPF.
Pros & Cons: While initial cost is higher than for a furnace split system, the better efficiency for heating leads to long-term savings.
Best Use: These units are ideal for all but the coldest climates. What you want to avoid is using the auxiliary electric heat strips to help with heating on days with freezing temperatures. They’re like space heaters in the air handler, and they are expensive to run.
Most Popular System and Cost: A 3-to-4-ton heat pump and matched air handler costs $14,200 to $19,500.
Heat Pump and Furnace
These are also called dual fuel systems because they can use either a fossil fuel to heat (gas or oil) or electricity to move refrigerant, which carries heat.
Configuration: A heat pump outside and a gas furnace with indoor coil inside.
Efficiency: Same as efficiencies above for heat pumps and furnaces.
Pros & Cons: The equipment cost is higher than the other split system types. The advantage is lower operating costs through higher total efficiency. The heat pump does the heating when the temperature is above a pre-set point, usually in the mid-30s F to around 40 degrees. When it’s colder outdoors, the gas furnace automatically replaces the heat pump to provide heat.
Best Use: Dual fuel systems are rare. Most are installed in homes with existing ductwork where winters are long and cold.
Most Popular System and Cost: A 100,000 BTU two stage gas furnace combined with a 3 ton (36,000 BTU) two stage heat pump costs $14,700 to $19,800.
Gas Package (Packaged AC & Furnace)
Package heating and AC systems, also called gas packs, are most common where basements are not common, mostly in the southern US.
Configuration: A gas furnace and an AC condensing unit are housed in a common cabinet that is set on the ground outdoors or on the roof. The system is connected to ductwork in the home.
Efficiency: Package unit furnaces are usually low-80s in AFUE efficiency. The AC range is 13-16 SEER.
Pros & Cons: The cost of the equipment is low, but so are efficiency levels, so operating costs are the highest of any system type. Plus, because the entire unit sits outside, the lifespan of a package unit is shorter than for other systems.
Best Use: First, we don’t recommend a package unit unless the home has no basement where equipment can be installed and is relatively small, so giving up living space for the equipment isn’t desirable. These units make the most sense in temperate climates where a high efficiency isn’t the top priority.
Most Popular System and Cost: A package with a 60,000 to 80,000 BTU single stage gas furnace combined with a 3- or 4-ton single stage AC costs $8,700 to $12,400.
Electric Package (Packaged Heat Pump)
Like gas packs, packaged heat pumps only make sense where basement/indoor space isn’t available.
Configuration: These heating and air conditioning systems include a heat pump and air handler in one cabinet.
Efficiency: SEER ratings up to 16 and HSPF ratings up to 8.5 are common.
Pros and Cons: Cost is lower than most systems other than gas packs. Efficiency is quite low too, so they cost more to run than other heat pump types.
Best Use: Where using a package unit is your best installation option – and you want higher efficiency heating than a gas pack provides.
Most Popular System and Cost: A package with a 3- or 4-ton single stage heat pump and matching air handler costs $9,200 to $13,900.
Mini Split or Ductless Heat Pump
As noted, heat pump technology is preferred around the world, and mini split heat pumps lead the way.
Configuration: A condensing unit sits outdoors. Sizes start at 6,000 BTU, but for central heating and AC, sizes are 24,000 to 84,000 BTU. Indoors, 1-8 evaporators, aka indoor units, are placed in rooms or large zones of the home. Evaporators range in size from 6,000 to 36,000 BTU.
No ductwork is required; hence they are also called ductless systems. The condensing unit connects to each indoor unit with wiring and refrigerant lines. Each indoor evaporator is controlled separately and requires its own drain line for removing moisture dehumidified from the air.
Efficiency: SEER ratings for air conditioning range from about 17 to 42. Heating efficiency is 9 to 15 HSPF.
Pros & Cons: Tremendous efficiency is the key value of a mini split system. If you install just a few zones (indoor units), total installation cost is lower than ducted systems when the cost of ductwork is included.
Once you begin to consider 4-8 zones, installation cost might rise above a standard split system. Finally, many split systems can extract heat from outside ambient temperatures close to or below zero, so using one in a cold climate is a possibility.
Best Use: There’s no “bad” place to install a mini split. They are used as central heating and cooling systems and for supplemental use where an existing system isn’t doing the job. Ductless systems are popular in the construction of new homes and in additions/extensions on existing homes, converted attics and garages too.
Most Popular System and Cost: A 48,000 BTU mini split system with 4 or 5 zones costs $11,900 to $16,300.
Geothermal Heat Pump
Standard split system heat pumps are also called air source heat pumps because they release heat into the outside air when cooling a home and gather heat from the air when heating.
Geothermal heat pumps are also called ground source heat pumps because they release and gather heat from below-ground, either in earth or water. Tubing filled with water and, if necessary, antifreeze is installed in loops, grids or deep, vertical shafts or wells is used for the purpose.
Configuration: The tubing system is outdoors, of course. The condensing unit contains equipment with refrigerant that extracts heat (heating mode) or transfers heat into it (cooling mode). These systems use a blower and ductwork to circulate air.
Efficiency: SEER ratings in the mid-20s to mid-60s, though most have ratings in the 30s. Most are not rated for heating efficiency, but it would be similarly high – two to three times that of air source heat pumps.
Pros & Cons: Super-high efficiency comes with the highest price of any heating and air conditioning system.
Best Use: The best use is in commercial settings, though some homeowners with a large budget are attracted to the superior energy efficiency they offer. For residential use, the most affordable installations are on property with enough space to run the tubing horizontally. However, deep wells offer higher efficiency for the increased installation cost.
Most Popular System and Cost: A 4 ton (48,000 BTU) geothermal heat pump system with matching air handler costs $22,800 to $31,000.
General Cost Factors
The cost ranges for each heating and AC system type are wide. Here’s a brief explanation of the reasons. There are product and installation factors.
System Size – Larger systems cost more.
System Efficiency – Cost goes up significantly for systems with premium efficiency compared to standard-efficiency systems of the same size.
Performance – Staged heating and cooling (two stage or variable capacity) raises the cost too. Furnaces and air handlers with single-speed blowers are more affordable than those with variable speed blowers. Anything that improves indoor climate control raises cost.
Brand and Series – Some brands, like Carrier and Trane, cost more than brands like Goodman in every product tier. Other brands, like Lennox, offer cheap, midgrade and premium product lines with significant cost differences between them.
Site Conditions – When access to where the equipment is installed is easier, such as in a walkout basement or first-floor utility closet, cost is lower than installation in an attic, crawlspace or on the roof.
Installer – Some brands allow you to hire any licensed installer for the work. Others require you to hire their brand-certified installers, often with specialized training, and cost goes up.
How Much is a Heating and Cooling System Installation?
Installation cost ranges from about $1,500 to $20,000. That’s not a helpful range, right? So, here are installation labor costs by HVAC type along with a few factors affecting price.
Standard split systems: $2,200 to $4,500 – (AC and furnace, heat pump and air handler, heat pump and furnace) – Factors are system location, complexity, sheet metal changes and the certification level of the installers.
Packaged system: $1,900 to $3,100 – Cost is lower because there is only one main unit instead of two to install. If a lift is used to place a unit on a roof, expect a charge of $400 to $1,000 extra for that.
Mini split systems: $1,500 to $10,000 – The number of zones is the largest factor. Expect installation cost for a condensing unit and one zone to range from $1,500 to $2,500. For every additional indoor unit, cost rises by $750 to $1,200 based on installation complexity.
Geothermal systems: $8,000 to $20,000 or more – These labor-intensive systems are installed by large crews using heavy equipment. As a result, professional labor accounts for a higher percentage of the total cost than it does with other system types.
Pricing by Brand
Instead of giving you a storm of dollar signs and prices, we’ve ranked the brands by price and by quality. The top section lists split system brands; the bottom includes brands that make mini split systems. You’ll notice that some standard system brands are identical – made in the same factory but sold with different labels.
Standard Split System Prices
|Brands||Cost Range||Quality out of 5|
|Trane & American Standard||Medium to High||4 to 4.5|
|Carrier & Bryant||Medium to High||4 to 4.5|
|Lennox||Low to High||3.5 to 4.5|
|Rheem & Ruud||Low to Medium||3.5 to 4|
|Armstrong Air & AirEase||Low to Medium||4|
|Daikin & Amana||Low to High||3.5 to 4|
|Heil, Tempstar, Day & Night||Low to Medium||4 to 4.5|
|York, Coleman & Luxaire||Low to Medium||3.5 to 4|
|Payne||Low to Medium||4 to 4.5|
|Goodman||Low to Medium||3.5 to 4|
Ductless Mini Split System Prices
|Brands||Cost Range||Quality out of 5|
|Carrier & Bryant (Toshiba)||High||4 to 4.5|
|LG||High||4 to 4.5|
|Fujitsu||Medium to High||4 to 4.5|
|Mitsubishi||Medium to High||4 to 4.5|
|Samsung||Medium to High||4 to 4.5|
|MrCool||Medium to High||4 to 4.5|
|Daikin||Medium to High||3.5 to 4.5|
|Midea||Medium to High||3.5 to 4.5|
|Panasonic||Medium to High||3.5 to 4.5|
|Gree||Low to High||3.5 to 4.5|
|Klimaire||Low to Medium||4|
|Bosch||Medium to High||3.5 to 4|
|Senville||Medium||3.5 to 4|
|Pioneer||Low to Medium||3.5 to 4|
|Cooper & Hunter||Low to Medium||3.5 to 4|
Choosing the Right System – Best ROI for the Climate
“Best Use” for each system type was discussed above, and climate played a role.
The Climate Map divides the continental US into temperature and humidity zones, and both are useful for deciding the best HVAC system for your home. Here are the preferred system types and the cost for a system to heat an average 2,000 square foot home.
Getting rid of humidity is just as vital here as cooling the air. Staged cooling, preferably with 2-stage air conditioning, gives the best return on investment. Consider a variable capacity system, but the return might not be worth the higher equipment cost.
Preferred System and Size: For system replacement in a home with ductwork, the recommended system is a 2 stage, 5-ton standard split system heat pump and air handler. Consider SEER ratings of 18 and higher.
Cost for 2,000 square foot home: $16,000 to $23,500 depending on whether you choose a more affordable 2 stage system with better ROI or opt for premium climate control (and cost) with a variable capacity system.
Other options: If you are a stickler for premium indoor comfort, then consider upgrading to a variable capacity heat pump. If you are building a home or addition, consider a ductless system with an indoor unit in each room. And if being as environmentally friendly as possible is crucial, get prices for geothermal systems, especially if you do not plan to sell your home in the next 15-25 years.
Cooling efficiency is the top priority in the desert Southwest. And variable capacity ACs and heat pumps give it to you.
Preferred System and Size: A 5-ton variable capacity standard split system or a 60,000 to 72,000 BTU mini split system with 4 to 6 zones is recommended. If you are building a home, consider a ductless mini split system with a SEER rating above 20. If an existing home has ductwork, then a standard split system in the 19 to 22 SEER range gives you the best return.
Cost for 2,000 square foot home: $16,500 to $25,000. Cost is lower for a standard split system, but you can get better efficiency and indoor comfort tailored to each zone with a multizone mini split system.
Other options: If you’re intrigued by the efficiency levels of geothermal, get quotes. But the higher cost is hard to recover through lower energy costs, so ROI will suffer – even if the salesperson tells you differently.
Slightly cooler, this region still experiences 100F days throughout the season.
Preferred System and Size: Depending on whether the home has ductwork, the best value will come from a 5-ton single stage heat pump (ducted) or a large multizone mini split ductless system.
Cost for 2,000 square foot home: A quality ducted system will start at about $14,400. A multizone mini split with up to 5 zones and 20 SEER efficiency will cost as much as $19,000.
Summers with high heat and humidity can be miserable, so again, dehumidifying the space is essential. And 2-stage and variable capacity systems remove more moisture than single-stage systems.
Preferred System and Size: A 4- or 5-ton standard split system (16-19 SEER) or multizone mini split system (20-28 SEER) are your best options based on whether the home has ductwork. Price 2-stage and variable capacity standard heat pumps, for a ducted system, to see how the price varies.
Cost for 2,000 square foot home: $14,000 to $19,500.
This is mainly a temperate climate with occasional heat spikes in summer.
Preferred System and Size: Again, a standard heat pump or a multizone mini split heat pump system are top choices. SEER ratings of 14-17 for standard systems and 16-20 for mini split systems gives the best ROI. You will likely need 3 to 4 tons (36,000 to 48,000 BTU) of capacity.
Other Options: If you want to save money on upfront costs, consider a split system with an AC and gas furnace. An electric furnace is worth considering too, but if you must use the furnace a lot, operating costs will offset their lower price.
Cost for 2,000 square foot home: $11,900 to $15,500.
This is a large zone with variable sub-climates, so the system recommendations are a little more nuanced.
Your choice of heating system becomes more of an issue in this zone. In warmer parts of the Cold region, if that makes sense, a heat pump will deliver the most efficient and cost-effective heating.
In the colder parts of it – Michigan across the plains to Eastern WA and OR, we recommend a gas furnace. Whether you include AC is a personal choice. Many homeowners get by with a room AC (window or portable), ceiling fans, box fans or a whole-house fan that can quickly cool a home in the evening or overnight.
Preferred System and Size: 60,000 to 100,000 BTU natural gas furnace and, if desired, a 3-to-4-ton central AC.
Other Options: A standard heat pump and air handler or a multizone mini split system. Size needed will range from 48,000 to 60,000 BTU (4 to 5 tons).
Cost for 2,000 square foot home: $4,900 to $8,000 for a furnace-only system. $11,900 to $14,500 for a furnace and AC split system.
Few homes in these parts of the country have central AC. It is rarely needed, so not worth the cost.
Preferred System and Size: 100,000 – 120,000 BTU gas furnace.
Cost for 2,000 square foot home: $6,100 to $11,000 depending on the brand of furnace and whether it is single stage, two stage or variable capacity. As you see, ROI drops with staged heating. If cost to value is key, then there’s no reason to avoid a single stage furnace. They come with efficiency levels as high as 95% AFUE.