How to replace your furnace

Stay warm and save money

Something is wrong with your furnace.

Perhaps it’s running louder than usual, making an odd noise or cycling on and off repeatedly – if it’s working at all.

Maybe your whole house is too cold, or some rooms are significantly warmer than others.

Or it could be that your winter gas and electric bills have shot up dramatically, even though energy prices haven’t changed much.

If your home isn’t getting the right amount of heat at the right price, it could be time to replace your furnace.

Doing so is a major undertaking; it requires careful research, professional help and significant expense.

But we’ve done some of the hard work for you to make the process easier. Our tips will help you determine whether you should replace your furnace or simply repair it and whether a faulty furnace is actually the reason your home is so cold.

When you should repair instead

Whether you should repair or replace a dysfunctional furnace depends on which part is causing the problem, how much the repair would cost and how old your furnace is.

Problems with the following parts can almost always be fixed, according to Brian Schutt, owner of Homesense Heating and Cooling in Indianapolis:

  • Hot surface ignitor
  • High/low limit switch
  • Anything involving a thermostat
  • Gas valve
  • Flame sensor
  • Thermocouple
  • Filters

If a part is no longer available because your furnace is too old, repair may be impossible.

Homesense also cautions that smaller problems can sometimes signal larger issues. For example, if the high limit switch, which shuts down your furnace if the temperature exceeds a safe level, is faulty, your system will operate at an excessively high temperature, and other, larger issues can arise quickly.

Signs your furnace is dead

Many experts say you should consider replacing your furnace after 15 years, since it might be reaching the end of its life.

We disagree.

Some furnaces will last 25 or 30 years — or even longer — so replacing a 15-year-old furnace just because is premature.

An experienced technician might be able to give you an idea of how much life your old furnace has left based on its service history and an analysis of how the components are functioning, but there’s no definitive way to tell.

Problems with the following parts usually mean it’s time to replace your furnace:

  • Heat exchanger (cracked)
  • Blower motor
  • Inducer motor
  • Control board (sometimes repairable, depending on furnace brand)

If the parts are still under warranty (a typical one runs 10 years) and these items are covered, do the repairs. But these parts often become faulty when the furnace is older. The repairs can be so expensive that replacement makes more sense, especially since one large repair can be the beginning of many repairs.

When your furnace isn't to blame

If your home is too cold, the furnace isn’t necessarily the culprit. The following fixes are easier and less expensive than furnace repair or replacement. (As a bonus, many of these will also make your air conditioner more effective.)

Is your furnace getting power? Check for tripped circuit breakers or blown fuses.

Leaky ducts (the metal tubes that distribute heat throughout your home) can be sealed so that more hot air actually gets blown into rooms instead of seeping into the attic. The American Council for an Energy-Efficient Economy says sealing leaky ducts can improve efficiency by 15% to 20%; it will set you back a few hundred dollars, but that’s much cheaper than a new furnace.

Better insulation in your attic and walls will help your home retain heat.

New weather stripping around doors and windows will keep cold out and heat in.

Upgrading a manual thermostat to an electronic one can regulate your home’s heat more effectively and lower your energy bills.

Replacing a furnace’s dirty air filter can improve airflow.

Go with high-efficiency?

A furnace can generate a certain amount of heat per hour. This number is expressed in British thermal units (BTUs). The higher the number, the larger the home the furnace can heat.

Furnace efficiency is expressed as average fuel use efficiency (AFUE), which measures the percentage of input BTUs the furnace can convert into output BTUs, or heat.

Today’s furnaces have an 80% to 98% AFUE, depending on the model.

Andrew Webb, business development manager of AC Pro in Fontana, California, says it doesn’t always make sense to buy the most efficient furnace from a cost versus savings standpoint.

“Here in Southern California, we very rarely use our gas furnace, and we recommend most homeowners to purchase an 80% efficient furnace, as the cost difference won't be made up if purchasing a higher-efficiency furnace,” he says.

If you live in the Northern or Northeastern United States and use your furnace for five-plus months per year, however, purchasing a 95% to 98% efficient furnace can pay for itself over the first five to 10 years, Webb says.

Calculate your energy savings payback

Knowing how much a new furnace will reduce your gas bills can help you decide how much extra to spend (or not) on a more efficient model. The higher your fuel bill and the greater the increase in efficiency, the shorter the payback period.

According to the Washington, D.C.-based American Council for an Energy-Efficient Economy (ACEEE), if your old furnace has a pilot light, it’s probably 65% efficient. In this scenario, upgrading to an 80% efficient unit would reduce your gas bill by $19 per $100.

If your annual gas bill from heating is $1,000, you’ll save $190 per year. Assuming the new furnace costs $3,000 installed, you’ll recoup 6% annually ($190/$3,000). It would take 16 years to recoup your investment.

That's too long.

Use ACEEE’s chart to calculate your energy savings from upgrading.

Furnace usage also affects your electric bill. The furnace’s blower fan, which circulates hot air, runs on electricity. Electricity use varies significantly among furnaces.

A variable speed blower can reduce electricity bills but can also increase the furnace’s price.

Choose the right size and features

In addition to examining efficiency, you also need to get the right-size furnace. Don’t assume your existing furnace is the correct size.

Online calculators from furnace manufacturers can roughly estimate what size your home needs.

A trained professional, however, can perform a detailed analysis that looks at how much heat your home needs given its insulation, number of windows and heat generated by lights and appliances.

Choose a furnace that’s too small, and your house won’t get enough heat. If it’s too big, your furnace will constantly cycle on and off, which wastes energy, wears out the furnace faster, doesn’t provide a consistent temperature and can be annoying.

If (and only if) you have allergies, asthma, lung disease or other respiratory problems, you might want a higher-end model that improves your indoor air quality by using an electrostatic filter or high-efficiency particulate arresting (HEPA) filter.

Models with variable-speed blowers and variable heat output can be quieter and keep heat levels more consistent.

Don’t worry about brand

Carrier has about a third of the market share for furnaces. Other top brands include Trane, Lennox, American Standard, Rheem and Bryant.

Which one is best?

Consumer Reports studied furnaces and found all the leading brands to be similar in reliability. CR also says you might not want to choose the latest and greatest model because it hasn’t proven its reliability. It found the main reason for furnace failure was inadequate maintenance or improper installation.

A good furnace will come with a manufacturer’s warranty of five to 10 years for parts. Some will include labor up to 10 years. Expect a longer warranty on high-efficiency furnaces.

Prices of major name-brand furnaces run from $2,300 to $3,000 on average, according to Consumer Reports.

Our experts say that for a 2,100-square-foot home, you can expect to pay $3,000 to $4,000, including installation, taxes and permits, for a new 90,000 BTU furnace with 90% efficiency.

However, for a small apartment or condo, the furnace might cost as little as $350 to $800.

Choose the right contractor

Whom you hire to install your furnace is more important than furnace brand.

Try the Air Conditioning Contractors of America’s search tool (www.acca.org).

Look for contractors who are NATE-certified; the North American Technician Excellence designation means they have passed tests demonstrating real-world HVAC knowledge.

Make sure the contractor is licensed, insured and bonded, and has been in business for many years. You want someone who will be there to service and repair your furnace and honor the labor warranty, which should be for at least one year.

A good contractor will perform a heat load analysis at your home based on square footage, ventilation, windows and insulation before giving you an estimate or recommending a furnace.

The labor estimate should include installation; any adjustments to ducting, venting, fuel delivery or electrical systems; and disposal.

The contractor should provide details about recommended furnace brand, size, efficiency and parts warranty, as well as operating costs.

Get comprehensive, written quotes that leave no room for surprises from at least three contractors.

Proper maintenance saves money

If you don’t maintain your furnace, expect unnecessarily high heating bills from inefficiency and repair bills for preventable equipment failure. You’ll also shorten the furnace’s life.

Most people don’t have the expertise to perform the necessary maintenance functions themselves, but many HVAC contractors offer maintenance plans.

"A furnace tune-up includes a thorough clean of the system, checking the electrical components and evaluating burners and heat exchangers," says Brian Schutt, owner of Homesense Heating and Cooling in Indianapolis. "This should be done by a licensed service technician who should explain what is being done and offer recommendations for preventative repairs if they find anything operating outside of specifications."

A thorough inspection will take 45 minutes to an hour. Schutt says a maintenance plan that includes two visits per year, ideally one in the spring and one in the fall, will cost about $150 to $200 per year.

You’ll also want to change the filter when it gets dirty and make sure the warm-air supply and return registers are clean and not blocked by furniture or curtains.

Should you replace your AC, too?

Contractors may tell you to replace your air conditioner when you replace your furnace. This isn't simply an unnecessary upsell, but that doesn't mean you have to make the switch.

Unless your home is heated with steam, hot water or radiant heat, your heating and cooling systems are linked. When you run your AC, your furnace’s blower helps circulate cool air throughout your home.

In an ideal HVAC system, the air conditioner and furnace have the same capacity and efficiency, which improves performance and comfort.

Doing both jobs at once might save significantly on labor since the contractor will only need to make one service call, and you might be able to negotiate a lower price on such a large job.

If you have an older AC that’s inefficient, it might make sense to replace it even if it still works.

The arguments against replacing your AC at the same time are obvious: You might not be able to afford such a large expenditure all at once, and your AC may have plenty of life left.