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How to Price Furnace Installation: A Contractor's Guide

Price a gas furnace replacement from your own costs: venting and condensate for condensing furnaces, the orphaned water heater, gas and permit lines, a worked example, three options, and where the DOE furnace rule stands.

Ijharul Islam October 21, 2026 9 min read

How to price furnace installation, in short: add the furnace, venting, condensate, gas and electrical work, permit, disposal, labor hours times your cost per billable hour and a callback reserve, then divide by one minus your target net margin and commission. Replacing an 80% furnace with a 96% one, including a chimney liner for the water heater, costs $5,630 and sells for about $7,510.

More on this topic: Pricing, estimates and getting paid, every guide in one place.

On a furnace replacement, the box is the easy part. The cost hides in the venting: a condensing furnace needs new plastic vent and intake pipes and a drain, and pulling the old furnace off a shared chimney can leave the water heater alone on a vent that may need changing. Miss those at the sales visit and they come out of your margin on install day. This guide shows the cost lines, a worked example at our usual $95 cost per billable hour, three options, and where the federal furnace efficiency rule and tax credit stand in October 2026. The dollar figures are examples: put in your own.

Key takeaways

Price = total cost ÷ (1 − net margin − commission). Dividing by 0.75 gives a 20% net margin with 5% commission; multiplying by 1.25 doesn't.
80% to 95%+ is a venting job: new intake and exhaust, condensate removal, and often a fix for an orphaned water heater.
Look at the water heater every time the furnace shares its chimney, and price the liner or vent change before you quote.
The 95% AFUE rule is unsettled: federal rules still list December 18, 2028 for manufacturing, but the Supreme Court vacated the ruling that upheld it in June 2026.
No 25C credit for 2026 installs: the IRS says it covered property placed in service through December 31, 2025.

How do HVAC contractors price a furnace installation?

HVAC contractors price a furnace installation by costing every line, then dividing by one minus their margin and commission, or by building flat replacement prices the same way and keeping them in a price book by size and efficiency. The method is the one in our heat pump pricing guide. What changes with furnaces is the list of lines, because the efficiency you sell decides how the furnace vents.

What goes into the cost of a furnace replacement?

Cost line	80% AFUE (non-condensing)	90%+ AFUE (condensing)
Furnace	At distributor cost	At distributor cost
Venting	Vent connector into the existing chimney or B-vent; check sizing	New exhaust and intake pipe per the manufacturer, wall or roof termination
Water heater on the same chimney	Usually stays as is; check the connector and vent size	Often orphaned: resize the vent, reline the chimney or change the connector
Condensate	None	Drain, trap, often a pump and outlet, a neutralizer where required, freeze protection where needed
Gas	Reconnect, shutoff, sediment trap, leak test	Same, plus confirm the pipe can carry the new input
Electrical	Reconnect	Reconnect, plus power for a condensate pump
Permit and inspection	Fee plus time	Fee plus time
Labor	Crew hours × cost per billable hour	More hours for venting and drain work
Removal, disposal, reserve	Haul away, callback reserve	Haul away, callback reserve

This list isn't ours alone. When the Department of Energy costed the switch from non-condensing to condensing furnaces in its 2023 final rule, it included new PVC flue and combustion-air venting, concealing vent pipes, an orphaned water heater (vent connector updates, vent resizing or chimney relining) and condensate removal. Its condensate costs covered the drain, a pump, heat tape for freeze protection, a drain pan, a neutralizer and an extra outlet for the pump.

How do you price the venting on an 80% vs 95% furnace?

Price the venting from what you see at the sales visit, not from a standard allowance. Walk the vent route with a tape: where the pipes will leave the house, how many elbows, whether they cross finished space, and whether the termination clears windows, doors and the gas meter by the distances in the manufacturer's instructions and your local code. Take a photo of the chimney, the water heater vent connector and the planned termination for the installer.

If the water heater shares the chimney with the old furnace, assume it will be orphaned when the furnace moves to plastic vent. DOE's rule explains why: the condensing furnace and the existing water heater can no longer share a vent because their venting requirements differ, so the old vent may need to be modified to vent the water heater safely. The usual fixes are a liner, a resized vent or connector, or a different water heater; size it from the vent tables in the fuel gas code your jurisdiction has adopted. Quote it as its own line, so the customer sees why the 96% option costs more than the box.

What does a worked furnace installation price look like?

Example: replace an 80% AFUE, 80,000 Btu/h upflow furnace in a basement with a 96% AFUE two-stage furnace. The existing AC coil stays. The water heater shares the chimney, so it gets a liner (subcontracted). Two installers for 8 hours each. The $95 cost per billable hour is built from the BLS May 2025 median wage for HVAC mechanics and installers ($29.33), 35% burden, 80% billable time, $15 truck and $30 overhead.

Line	Cost
96% AFUE two-stage furnace and thermostat	$2,400
Venting: intake and exhaust pipe, fittings, termination kit	$250
Condensate: drain, trap, pump, neutralizer	$150
Chimney liner for the water heater (subcontractor)	$900
Gas: shutoff, sediment trap, connector, leak test supplies	$60
Permit	$150
Removal and disposal	$50
Labor: 2 installers × 8 hours = 16 hours × $95	$1,520
Callback reserve	$150
Total cost	$5,630

At a 20% net margin and 5% commission: $5,630 ÷ 0.75 = $7,507, so quote $7,510. Check it: $7,510 minus about $376 commission minus $5,630 cost leaves about $1,504, which is 20% of the price. If you had added 25% to cost, you'd quote $7,038 and keep about 15% after commission. Overhead is already in the $95, so the 20% is net profit; use your own hours and costs, from job costing.

How should you build good, better, best furnace options?

	Good	Better	Best
Furnace	80% AFUE single-stage, existing chimney	96% AFUE two-stage, variable-speed blower	97%+ AFUE modulating, communicating thermostat
Venting and water heater	Vent connector checked and replaced if needed	New intake and exhaust, chimney liner	New intake and exhaust, chimney liner
Labor hours (example)	12	16	18
Total cost (example)	$3,150	$5,630	$7,120
Price at ÷ 0.75	$4,200	$7,510	$9,495

The gap between good and better is mostly venting, so say so on the quote. Where the house already has a condensing furnace, the venting and liner lines drop out and the tiers come closer. Size all three from a load calculation; see Manual J load calculation for contractors. If the AC is old too, quote the pair; see how to price AC installation.

Is the 95% AFUE furnace rule still happening?

It is unsettled, so don't sell on it. Federal rules (10 CFR 430.32, current as of October 19, 2026) still say non-weatherized gas furnaces manufactured on and after December 18, 2028 must reach 95% AFUE, up from 80% today. That is a manufacturing date, not an install date. The path since then:

Date	What happened
December 18, 2023	DOE publishes the 95% AFUE rule (88 FR 87502), compliance date December 18, 2028
November 4, 2025	The D.C. Circuit upholds the rule, 2 to 1
January 20, 2026	Gas industry groups ask the Supreme Court to review it (No. 25-879)
April 27, 2026	DOE asks for comment on a petition to push the compliance date to at least January 1, 2030
April 28, 2026	The federal government's brief agrees with the challengers and asks the Court to send the case back
June 8, 2026	The Supreme Court vacates the D.C. Circuit ruling and remands the case

Tell customers the truth: 80% furnaces can still be made and installed today, the 2028 standard may change, and the choice between 80% and 95% comes down to their gas use, the venting their house needs and how long they'll stay. Check the docket again before you put any date in sales material.

Are there furnace tax credits in 2026?

No federal one. The IRS page for the Energy Efficient Home Improvement Credit (25C), updated April 28, 2026, says it covered property placed in service through December 31, 2025; gas furnaces were capped at $600. Utility rebates may still apply, so list any rebate as a separate line under your price and let the customer confirm it.

What mistakes cost money on furnace installs?

Quoting the box, not the venting. The termination and the water heater decide the price.
Matching the old furnace's input instead of the house's heat loss.
No pump or outlet in the price when the drain can't reach a floor drain by gravity.
Skipping the permit and inspection time in the labor hours.
No follow-up on the customer who wanted to think about it; see how to follow up on unsold estimates.

Where CrewRobin fits

CrewRobin's price book holds each furnace, venting, liner and labor line, and you add them to good, better, best quotes the customer picks and signs online, with follow-up texts on day 2, 5 and 10. When a no-heat call comes in, the AI receptionist treats no heat in freezing weather as an emergency and gives it the earliest slot or transfers it to your cell, your choice. Technicians can mark up the chimney and vent route photos with arrows and text for the installer. CrewRobin doesn't offer consumer financing, so pair it with a financing partner if your customers need one. See how it works for HVAC companies.

Frequently asked questions

How do you calculate a furnace installation price?

Add the furnace, venting, condensate, any water heater vent fix, gas and electrical work, permit, disposal, labor hours times your cost per billable hour and a callback reserve. Divide by one minus your net margin and commission: for example $5,630 ÷ 0.75 = about $7,510.

How many labor hours does a furnace replacement take?

A like-for-like furnace swap is often well under a day for two installers. Converting from 80% to a condensing furnace adds hours for the vent and intake, the drain and any chimney work. Track your own jobs and price from those.

Why does a 95% furnace cost more to install than an 80% furnace?

Condensing furnaces vent through new plastic pipe, need condensate removal, and can leave a water heater orphaned on an oversized chimney. DOE's own cost analysis lists the same items.

Are 80% furnaces being banned in 2028?

The rule on the books says non-weatherized gas furnaces made on and after December 18, 2028 must reach 95% AFUE, but the Supreme Court vacated the ruling that upheld it in June 2026 and DOE has a petition to delay it. Treat the date as uncertain.

Is there a federal tax credit for a new furnace in 2026?

No. The IRS says the 25C credit covered property placed in service through December 31, 2025. Check utility and state programs instead.

Put it to work this week

Put your furnace tiers, venting and liner lines in one price book, then send three-option quotes customers can sign from their phone. CrewRobin is free until your first 10 booked jobs, no card up front. Start free or see pricing.

Sources

Figures from outside CrewRobin were checked against these pages in October 2026. Most industry benchmarks come from vendors and agencies, so treat them as ranges, not rules.

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