How Much Does Gas Furnace Replacement Cost?

Gemma Johnstone
Written by Gemma Johnstone
Updated November 21, 2022
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The average cost to install an 80,000 BTU gas furnace is $3,800 to $10,000

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Installing a gas furnace can help keep your home warm and toasty even during the harshest of winters. The average gas furnace replacement cost for a 1,600 to 2,000 square foot house is about $7,000, with a typical range of $3,800 to $10,000, though some high-efficiency models will cost as much as $12,000.

Gas furnaces work to convert energy into heat, which moves throughout your home in the form of hot air. Furnaces are available in many fuel types, but gas furnaces are by far the most popular choice for homeowners. Why? They are relatively inexpensive to install, do not require too much upkeep, and tend to heat homes without accruing gigantic monthly energy bills. Read on to learn all the factors involved in the cost to replace a gas furnace.

What Does a New Gas Furnace Cost? 

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A new furnace cost depends on the type of furnace you choose, as well as labor and installation fees.

Cost to Replace a Gas Furnace by Type

You’ll be looking at one of three main gas furnace types. There are better long-term savings to be had by investing in a more energy-efficient style—if your earmarked budget can stretch to that. 


Expect to pay between $700 and $3,000 for one of these easy-to-source furnaces with a simple on-off action. They might be the most painless on your initial bank balance, but they don’t operate as efficiently, comfortably, or quietly as the other two types.


Two-stage (or dual-stage) furnaces are a bigger upfront investment than single-stage models, costing between $1,000 and $3,500. However, with their high and low blower settings, they aren’t always blasting out the hottest air, pruning your annual energy bills. And their lower setting is quieter when you’re settling for a cozy night in.


These fuel-efficient furnaces feature variable speed blowers and cost between $1,300 and $6,500. Because they maintain a consistent temperature using a computer-controlled thermostat, your furnace won’t guzzle gas working hard to warm the house when there’s a sudden cold snap.

Labor Costs for Gas Furnace Installation

Labor will cost $500 to $2,000, though quotes are almost always free. You will pay $50 to $100 per hour for a licensed furnace installer, along with up to $50 per hour for any additional team members. A qualified HVAC pro will determine the best furnace to suit your needs, taking into account your location, the size of your home, the age of your home, and your average monthly energy bills.

Cost of Converting to a Natural Gas Heater

You'll have to boost your budget if you're converting a heating system rather than replacing an existing natural gas furnace.

Propane to Natural Gas

Even though they're more expensive to buy, it costs a fair bit less to run a natural gas furnace compared to a propane furnace. Some furnaces can run off either type of gas, and conversion kits cost less than $100.

If you don’t already have a gas supply running to your house, installing an underground gas line costs from $120 to $1,350. And, if you need a new tank, you could pay up to $500 to shift the old one (depending on its location and local regulations).

Electric to Natural Gas

Switching to gas from electric heating makes sense when facing frigid winters. But tack on an extra $120 to $9,850 on top of the cost furnace’s cost.

No gas line? Budget $120 to $1,350 to install one. Plus, if you’re currently using electric baseboard heaters, ductwork installation costs $1,500 to $7,000. Then there’s the cost of a building permit, which can be up to $400, if you have to apply for one to make the change.

Heat Pump to Natural Gas

You’ll be facing a similar bill to change from a heat pump to natural gas as you would for switching from electric heating. So, anywhere from $120 to $9,850, depending on whether you need to install ductwork and a gas line.

Oil Furnace to Natural Gas

Oil furnaces are common when there’s no natural gas available in your neighborhood. But, if gas is now on offer, you might want to make the switch. Don’t forget to factor in the upfront costs of extending the gas line to your home and getting a service and professional clean for the ductwork—oil furnaces produce a lot of soot. These will add another $500 to $1,840 to your final bill.

Gas Furnace Replacement Cost Breakdown

The biggest cost will be the furnace itself. A brand new furnace costs an average of $2,250 and tops out at around $4,000. High-efficiency models, which may be necessary for colder-than-average climates, average $3,500 to $5,500. There is also labor to consider, in addition to a number of hidden costs that you should keep an eye on as you collect estimates from a qualified local HVAC expert. 

Here’s a breakdown of how you can expect to spend your money when taking on a gas furnace installation project:

Buying a New Furnace

Gas furnaces are complex pieces of equipment and, as such, will take up the lion’s share of your total installation cost. The furnace itself will gobble up 50% to 75% of the cost of the total project. You will pay more for a high-efficiency furnace and the price will also escalate as you opt for larger units to cover more square footage. As a rule, you will need 30 to 50 BTUs per square foot. So, an 80,000 BTU furnace will keep a 1,600 to 2,000 square foot home nice and toasty during the winter. 

Every gas furnace features a fuel efficiency rating. This is the Annual Fuel Utilization Efficiency (AFUE) rating. These efficiency ratings break down into three categories, each with differing price ranges.

Furnace costs can range from $900 to $4,000 depending on the efficiency type
  • Mid-Range Efficiency: These gas furnaces boast an average AFUE rating of 80%, meaning that it loses 20% of usable energy during use. This is the least expensive gas furnace type, at $900 to $1,800.

  • Mid-Range Efficiency with AC: This type offers the same efficiency rating as above but includes an integrated air conditioning unit. This will be slightly more expensive, at $2,500 to $3,000.

  • High Efficiency: These are the latest and greatest gas furnaces on the block. The AFUE rating is off the charts, at 95%. In other words, it loses just 5% of energy during use. Your monthly energy bill will thank you, but these furnaces are the most expensive at $3,000 to $4,000.

Removing an Old Furnace

Chances are, this is not your first rodeo. You may have to remove an old gas furnace before you install the new one. In some cases, recyclers will grab the old furnace and use it for parts, charging you $50 or so. Professional removal will cost $60 to $500, depending on how far you live from a dumpsite, how heavy your furnace is, and any environmental and dumping fees required by law. You should replace a gas furnace every 15 to 20 years, depending on how well it is operating.

Installing New Ductwork

Your new furnace won’t work properly if it is not properly integrated with the ductwork, vents, and filters of your home. You may need an entirely new ductwork system, especially if your new furnace features a different design than your pre-existing furnace. Installing new ductwork costs $1,500 to $7,000, depending on the number of stories in your house, the number of intake and output vents, and any necessary siding and wall repairs. If you just need some minor duct adjustments and repair, expect to pay around $1,000.

Gas Line

Gas furnaces need to connect to a gas main. If you are replacing a pre-existing model, the gas line should be ready to go and no installation will be necessary. If this is your first gas furnace, the cost to install a new gas line is $250 to $800.

Permits and Inspections

Depending on where you live, you may need a professional inspection and a building permit in order to install a new gas furnace. Building permits cost $400 to $1,500, and this price should cover any inspection fees. These inspections will ensure that the furnace operates safely, so be sure to shop around before settling on an inspector.

What Factors Influence the Cost to Install a Gas Furnace?

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There are additional factors to consider when pricing out gas furnace replacement costs. Some of these could actually save you money, so be on the lookout.

Upgraded Electrical Circuit

Do you have a vintage furnace that’s been in your home for decades? Upgrading to a modern, high-power model might mean having to shell out the cost to replace your circuit breaker box if it’s equally antique—budget around $1,150 for this job.


Though the upfront new furnace cost can be worrisome, it will pay for itself over time by reducing your monthly energy bill. To help the savings keep rolling in year after year, most gas furnaces ship with robust warranties. Most new furnaces come with a 10-year limited manufacturer’s warranty for parts and a 20-year warranty on the heat exchanger, which is the most expensive component of a gas furnace. Ask your pro to explain the ins and outs of your warranty before making a final decision.

Rebates and Incentives

If you purchase a high-efficiency gas furnace you will receive a yearly tax credit of $150 (as of this writing.) There are some hoops to jump through, so gather proof that your newly installed gas furnace features an AFUE rating of 95% or higher. 

Additionally, new gas furnaces can qualify for a number of local utility incentives and rebates. Call your utility company to inquire about current promotions and be sure to ask your contractor for any money-saving tips.

Air Filters

Ask your pro to take a look at your air filters as they install the new gas furnace. Change air filters twice a year to keep the furnace operating at peak efficiency. Plus, you’ll breathe easier (literally) knowing that the filters are fresh and clean. The cost to replace an air filter is negligible, but it will pay dividends in the long run.

Frequently Asked Questions

A gas furnace is a significant investment for homeowners, even if it will help cut down on the monthly utility bill. Research furnace installers near you ahead of time to make sure they have the necessary insurance and licenses to do the job. You can also search the web for customer reviews and check out the Better Business Bureau website for any warning signs. Finally, give them a call to get a feel for their professionalism and overall knowledge base.

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