Replacing an HVAC system is not something most homeowners have to do often. The Department of Energy recommends replacing HVAC systems every 10 to 15 years, though many systems can last at least 20 years.
Unfortunately, when your HVAC system breaks, the cost for a new system can be high. Nationally, the average cost of a new HVAC system is about $7,500 but can range anywhere from $5,000 to $12,000 depending on your location, the unit’s size, style and brand, among other factors. A broken HVAC system can also cause your heating and cooling bills to skyrocket and your home to be an uncomfortable temperature until the system is replaced.
HVAC systems are expensive and necessary, but replacing one doesn’t have to be stressful if you take the time to learn the ins and outs of this type of project, including the potential cost and how to finance the expense.
HVAC cost breakdown
You should expect to pay anywhere from $5,000 to $12,000 for an HVAC replacement. If you need ductwork replaced or installed, or you would like additional components such as air purifiers, dehumidifiers, smart thermostats and UV lamps, your HVAC system cost will likely be on the higher end of that range. Here are some of the additional costs to consider.
Ductwork replacement or installation
Ductwork is priced by quantity and averages around $15 per linear foot, says Mischa Fisher, chief economist for the home services website Angi. “The average total cost ranges from $460 to $2,000 and will depend on what material you choose, whether you need to add vents, the size and layout of your home, where you live, and the accessibility of any existing ductwork,” says Fisher.
Air purifiers can be a great option for improving indoor air quality in your home. “There are various sizes and prices available on the market, so think about what works best for your home,” says Fisher. Costs can range from $100 to thousands of dollars, depending on size, brand, noise level and various other features.
Installing a whole-house dehumidifier can range in cost from $1,300 to $2,800, averaging around $2,000. “Basement models range from $1,300 to $1,800 and crawl space models are closer to between $1,500 and $2,000,” says Fisher. “The cost range depends on the unit capacity, brand, accessibility of the installation area, and whether you decide to add a designated outlet or return duct.”
Smart thermostats are typically more expensive than traditional alternatives, costing $130 to $300 or more, depending on the brand, special features and difficulty of installation. This will often be money well spent, however, as these types of thermostats can save you money over the long run.
“Make sure you invest here, smart thermostats can help to save you money by helping you learn about your habits, such as when you leave, when you return, optimizing energy usage and most importantly, vacation modes and the ability to turn on or off your system when you’re on your way to or from home,” says David Steckel, a home expert with Thumbtack.
Homeowners are seeing the benefits of lower electricity bills and cleaner air by adding UV lights to their HVAC systems. New bulbs for these types of lamps start at around $100 per bulb and generally need to be replaced each year. “For new parts and installation, you could see a total cost of up to $1,500,” says Fisher. “This seems expensive but will ultimately save you money on monthly bills and help keep your family healthier, especially if you live in an area with poor air quality.”
Factors of HVAC system costs
The range for HVAC system costs is broad because a wide variety of factors determine what your actual price will be. These factors include:
The larger your home, the more square footage the HVAC system will need to heat or cool. The size of the unit installed is determined by the amount of square footage of your home, and if your home is large, you may need more than one HVAC unit to cover it.
Your home’s construction also plays a critical role in what HVAC system you need. If you have adequate insulation you may be able to get away with a unit that has less air conditioning and heating capacity. Improper insulation means that the HVAC system will need to work much harder to keep your home cooled or heated, and you may need a unit with more heating and cooling capacity.
If you’re replacing an HVAC system with ducts, it can be easy to overlook your ductwork because most people don’t fully understand its purpose and how it affects the HVAC system. To maximize the comfort and energy efficiency of your home, a duct system must be designed and installed by a professional, which is why you’ll need to know the cost to install an hvac system with ductwork. You may need the whole thing to be replaced, not just the unit.
It is possible the existing ductwork in your home will be sufficient for a new HVAC system. However, if your ductwork does need repair or replacement, you should expect to see some extra costs tacked onto the average cost to replace heating and air conditioning. New ductwork can cost up to $3,000 to install correctly.
Brand of HVAC unit
The brand of the HVAC system you select may have a significant impact on equipment cost, installation cost and warranty. Some of the most common HVAC system brands on the market today include:
SEER stands for Seasonal Energy Efficiency Ratio, which is the rating that results from the ratio used to measure a system’s energy efficiency. The higher the SEER rating, the more energy-efficient the system will be and the more money you’ll save on utility bills each year. Units with higher SEER ratings cost more, though, and if you live in a moderate climate, it may not make financial sense to spend more on a system with a higher SEER rating.
HVAC systems that are harder to access or older homes that require modifications or custom parts will likely result in higher HVAC replacement costs, so keep that in mind when you’re shopping for HVAC units for an older home.
When considering your options for a new HVAC system, you will have a variety of optional upgrades or add-ons. Many HVAC companies offer things like dehumidifiers, air purifiers, zoning systems, smart thermostats, carbon monoxide alarms, UV lamps, ventilators and more. It is important to review the value and cost of each add-on to determine if it is something your home needs.
Tips for saving on HVAC replacement
While HVAC replacement can be expensive, you may be able to save money by using one or more of the following methods.
Find the right size for your home
Speak with more than one professional to help determine an adequately sized HVAC system for your home and needs. Make sure that your HVAC specialist recommends the purchase of a system big enough to meet your needs, but avoid spending the extra money to purchase one bigger than needed.
“Research the different options and talk to the HVAC pros about what might work best for your home based on its size, age and layout,” says Fisher. “Some systems will be more challenging to install in multi-level homes or homes without existing ductwork, so consider what makes sense for your space.”
Get multiple quotes
Find an HVAC installer who is fair and upfront about price, but don’t just go for the cheapest. You’ll want the best work for the least money, not the least work for the least money. If you try to cut corners, you could be facing repairs well before you’re ready to.
“Get at least three estimates and don’t be shy about asking as many questions as you’d like,” says Fisher.
Ask around for referrals and references. All companies are not equal, especially when it comes to the customer service they offer. If an HVAC company has a reputation for terrible customer service but offers you the lowest replacement cost, you may end up spending more in the long run due to the poor service.
“Research various local HVAC pros and check out their ratings or reviews online,” says Fisher. “Many high-quality pros will come to your home to check out the issue in person before providing a detailed estimate. You can help ensure the estimate is accurate by understanding your system and providing as many details as possible about the current system, what you need done, what work has been done in the past and any issues you’ve been having.”
HVAC financing options
Once you’ve determined who you want to hire to replace your HVAC system, determine how you will pay for the replacement. If you don’t have $4,000 to $12,000 in your bank account waiting to be spent, you’re not alone. There are plenty of HVAC financing options available to help you foot the cost of the bill.
If there is no equity in your home or you are looking for a loan with lower fees, a personal loan might be an option to fund your HVAC replacement. Most banks and lending institutions offer personal loans to people who have average or above-average credit. These loans typically have a higher interest rate than home equity loans but a much lower rate than most credit cards. There are also personal loans available for people with worse credit, but you can expect to pay a higher interest rate if your credit is rough and you need it for an HVAC loan. On the upside, personal loans usually offer quick access to funds, which is important if your HVAC system is not functioning correctly.
Home equity loan
A home equity loan is an option if you’ve built up equity in your home. Equity is the difference between what you owe on your mortgage and what the home is worth, and you can borrow against it in certain circumstances with a lump sum loan to fund things like HVAC replacements.
For example, if your home is worth $150,000 and you owe $100,000 on it, you have $50,000 in equity. Banks will allow you to borrow a percentage of that equity — usually up to 85%, but it can vary — and you can usually do so with low but variable interest rates and tax-deductible interest.
There may be closing costs and other fees to consider with this type of loan, though, and you’ll have to have equity to qualify. You will also be putting your home up as collateral, so if you don’t think you can pay it back, don’t do it. Still, this option can be a good way to finance an HVAC replacement if you don’t have the funds lying around.
Home equity line of credit
Similar to a home equity loan, a home equity line of credit (HELOC) allows you to borrow against the equity in your home, but rather than receiving a lump sum, a HELOC gives you access to a line of credit that you can borrow from repeatedly during the draw period. This may be a great option if you have several home improvement or maintenance projects in mind, or if you aren’t sure whether the HVAC replacement will require ductwork and don’t want to have to take out multiple loans to pay for it.
For example, if you are offered a HELOC with a $50,000 line of credit and spend $8,000 for an HVAC system replacement, you will have $42,000 left on your line of credit. As you pay back the $8,000 borrowed the money will be added back to your available credit. HELOCs usually offer a low interest rate, but the rate is often variable and can fluctuate. There may be fees associated with this type of loan, and as with home equity loans, your house will act as collateral.
Some HVAC companies offer special financing to customers who meet the requirements of the financing. This type of financing can sometimes be interest-free for a specific period of time before turning into a high-interest loan. This type of financing can be a great option if you will be able to pay off the loan within the introductory period but can be extremely costly if you let the loan age and become a high interest loan, so be careful with this type of funding. You could end up paying more than you anticipated.
Replacing an HVAC system can be a costly and complicated project. Here are some of the key steps if you plan to move forward with an HVAC projec:.
- Research will help you make the best decisions. Understand what type of system will work for your home, based on its size, layout, age and existing system.
- Add ons will cost you more. Additional components such as air purifiers, dehumidifiers, smart thermostats and UV lamps, will push the price of your project even higher. Understand all of the variables ahead of time, as well as the value of each of these options and how they may impact your long-term costs.
- Multiple estimates can help save you money. Get at least three estimates and ask a lot of questions before signing a contract to make sure you’re working with a high-quality pro and are not faced with any major surprises along the way.
Once a new system is installed, protect your investment by keeping the system in top shape.
“Just remember that your HVAC system is your home’s respiratory system and it’s crucial to take care of it with regular maintenance,” says Steckel.