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HVAC Installation Cost


HVAC installation cost for most systems can account for 40% to 60% of most jobs.  By installation, we mean the labor cost to place the HVAC components, connect them, adjust them and get them running properly.  If we also included in the HVAC installation cost additional materials required to complete the job, then installation might account for as much as 80% of the job or more!

Our purpose here is to break down the factors that enter into HVAC installation cost including the HVAC components, additional equipment, and the cost of labor.
HVAC Components Cost
We're discussing complete HVAC systems which would include air conditioner and gas furnace split systems, heat pump split systems with either an air handler or a gas furnace, and package units.  There is a wide range of possible costs for the HVAC components. The price goes up as size and efficiency increases.  It also rises with performance features such as communicating technology, high-tech thermostat, 2-stage or modulating heating and cooling, a variable-speed blower and low-noise operation.  Some brands cost more than others, even when the size, efficiency and features are the same.  This may be due to a better track record for reliability or it may simply mean that the brand has a better reputation whether it is earned or not.

If we were to break down an average system, for example a 3 ton central air conditioner with a 100,000 Btu gas furnace, these cost samples will give you an idea of what you'll pay for the equipment.

Standard efficency (80% AFUE) and basic features: $2,400 to $3,200

High efficiency (90% to 95% AFUE) and some performance features: $3,000 to $5,000

Very high efficiency (above 95% AFUE) and top performance features: $5,500 to $8,500

HVAC Installation Cost
There is even more variance here in costs.  These are the factors that will affect the total HVAC installation cost.

1. Minor additional sheet metal like a new sheet metal plenum for connecting the furnace or air handler to existing duct work might increase the cost by $100 to $400.

2. Minor additional venting materials might increase the cost by $50 to $200.

3. Additional refrigerant line or gas line might increase the cost by $100 to $400.

4. Removal of an old gas furnace, condensing unit or package unit might increase the cost from $200 to $600.

5. Replacing duct work is the most expensive “extra” and might increase the cost by $1,000 to $10,000 depending on the size and complexity of the house.

HVAC Labor Cost
Some contractors will provide an itemized estimate that shows the cost of the equipment, the materials and the labor for the installation of a new or replacement HVAC system.  Labor rates vary based upon the cost of living in your area, the size of the crew doing the work, as well as the competition among HVAC contractors.

On average, expect the labor portion of the HVAC installation cost to be between $125 and $200 per hour.  Though it might be called labor costs, it really includes wages, benefits, workers compensation insurance and liability insurance, tools, facility and vehicle overhead, and yes, some profit built into the estimate.

Other Factors Affecting the HVAC Installation Cost
In general, the more complex the installation is, the more it will cost.  For example, if you want a package unit installed on a roof, it will cost more than installation on a pad next to your home's foundation.  If you need a furnace installed in a cramped attic or crawl space, it will cost more than having it installed in a roomy first-floor utility closet.

Finally, HVAC installation cost is affected by how busy the contractors are.  In other words, don't expect a contractor to be willing to flex much on price in during the hottest stretch of summer or coldest months of winter.  When they've got all the work they want, they'll write their estimates for full price.  However, when business is slower, depending on your region of the country, contractors are often willing to estimate or negotiate a lower HVAC installation cost in order to keep business steady.

If your furnace quits in the middle or winter or your A/C fails in July, there may not be much you can do about this factor.  However, if you are choosing to replace a working system because it is old or inefficient, it might make sense to get bids during slow seasons in your area.  Those estimates will likely be much more competitive.  Don't hesitate to make counter offers either, in order to negotiate the best possible HVAC installation cost for the work you need done.

It is easy to see how installation can be so expensive, often forming a larger portion of the total bill than the HVAC equipment.  The costs we have outlined above will help you understand what to expect when getting HVAC installation cost estimates from  contractors in your area.  We recommend getting at least 3 estimates in order to find the right contractor at the right price.

Remember that the quality of the installation is an important part of how well your HVAC system will perform in the years ahead, including how long it will run before needing repairs or replacement.  The lowest estimate may not be the best long-term value.  Choose a contractor you believe will do a good job and then pursue the lowest HVAC installation cost you can.

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