Furnace Buying Guide: Choose the Best Furnace For Your Home

Buying a furnace is a big decision and a significant investment. Your furnace will determine your home’s comfort level for many years, possibly decades. You want to make an informed decision, but where to start?

Furnaces are a popular heating source in the United States. According to a 2020 U.S. Energy Information Administration survey, 58% of American households use furnaces as their primary heating source, but furnaces aren’t the only option. Other families use boilers, baseboard heaters, or heat pumps to heat their homes. Each heating system has pros and cons. Likewise, various types of furnaces are powered by different fuels, each having advantages and disadvantages. Could an alternative system or fuel source be suitable for your home?

When your furnace is on the fritz, you must first decide whether to repair or replace it. Repairs are often a good option, but replacement is better under certain conditions. Buying a new furnace brings about even more decisions about furnace size, efficiency, and cost. The process can be overwhelming if you don't know what you're looking for. This guide will break it down to make your furnace buying experience as painless as possible.

What is a furnace? A furnace is an appliance that heats a home by generating heat, transferring heat to the air, and circulating the heated air throughout the house. Most furnaces are a component of the home’s HVAC (heating, ventilation, and air conditioning) system.

Furnaces have been used to heat homes and buildings for centuries. All furnaces require an energy source to produce heat. Early furnaces burned wood or coal. Today’s furnaces use natural gas, propane, fuel oil, or electricity. However, some homes still rely on wood furnaces for primary or supplemental heating. All furnaces operate similarly, but they are available in different sizes with various efficiency ratings and motors.

Three types of heating systems used in modern homes are forced air, radiant heating, and heat pumps. Each heating system requires a heat source (furnace, boiler, electric coils), a distribution system (forced air or convection), a control system or thermostat, and an energy source (natural gas, propane, electricity, or oil).

Location is one factor that determines which heating system and fuel source a house uses. Furnaces and boilers tend to be used in urban locations with access to natural gas. In fact, according to the U.S Energy Department, 57% of homes use natural gas for heating. Rural locations without access to natural gas typically fuel their systems with propane, oil, or electricity.

Climate is another factor that determines which heating system is used. Heat pumps operate best in mild climates where sub-zero temperatures are nonexistent. On the other hand, radiant systems are popular in cold climates where sweltering temperatures and the need for air conditioning are rare.

Forced air heating is the most common system. Forced air systems utilize a furnace fueled by natural gas, propane, oil, or electricity. The fuel source is burned or heated within the furnace, and heat is transferred to the air. A fan in the air handler blows the warm air through the home’s ductwork and heat registers. Each room in the house generally has one supply duct and one return duct. The return duct channels cold air back to the furnace’s air handler to be reheated.

• Warms home quickly
• An air conditioner can use the same ductwork
• Highest AFUE (annual fuel utilization efficiency) ratings of any system
• A whole house humidifier can be added

• Can be noisy from loose connections and expanding/contracting metal in ducts
• Require routine filter changes and regular maintenance
• Require ductwork and space in walls; installing ducts in an existing home is expensive
• Can create dry and allergen-filled air
• Heats the air, not the objects in rooms

Radiant heating systems transfer heat from hot surfaces to people and objects in rooms through convection–heated air rises from the system, and cold air sinks to be heated. Typical forms of radiant heating include steam radiators, hot water baseboard heaters, and electric baseboard heaters. Radiant heating panels can also be installed in floors, walls, and ceilings.

Radiant heating systems deliver heat through electric-resistance coils or hydronics. Electric radiant heating systems use coils or wires that heat up inside a baseboard unit, beneath floors, or behind walls and ceilings. A hydronic heating system uses water heated by a boiler and pumped through pipes to radiators, baseboard heaters, tubing in the subfloor, or panels in walls or ceilings.

Heat pumps are becoming a popular heating system. A heat pump can replace a furnace in a forced-air system or be installed as a mini-split (ductless) system with a small outdoor compressor and one or more wall-mounted air handlers. The advantage of heat pumps versus furnaces is that heat pumps can also provide air conditioning. Heat pumps are typically electric, but natural gas models exist.

Heat pumps don’t generate heat; they function like an air conditioner in reverse to transfer heat. An outdoor pump draws heat from outside the house and releases it inside via an air handler. Heat pumps are either air-source (remove heat from the outdoor air), ground-source (use coils buried in a trench to draw heat from the ground), or water-source (draw heat from a lake or pond). Air-source heat pumps are the least expensive to install.

The Inflation Reduction Act of 2022 includes a heat pump subsidy for heat pumps installed between January 1, 2023, and 2032. Consumers can receive rebates and tax credits for installing new heat pumps.

• Provide heating and cooling
• Ductwork is not required, but existing ductwork can be utilized
• Energy-efficient
• Low operating costs
• Mini-splits provide precise temperature-control for each room and have quiet fans

• Unsuitable for cold climates
• Mini-splits have separate controls in each room
• High equipment and installation costs
• Require routine filter changes and regular maintenance

A furnace provides heat by burning or heating a fuel source, such as natural gas, and transferring warmth to the air. A fan or blower distributes the warm air throughout the home or building via ducts and heat registers. A thermostat controls the home’s temperature.

Furnaces are categorized by the fuel that powers them. Regardless of the energy they use, all furnaces operate in similar manners. The five main types of furnaces are natural gas, propane, oil, electric, wood, and geothermal.

Natural gas and electricity are the most popular heating fuels in the United States. According to a 2000 study by the U.S. Census Bureau, 51% of homes use natural gas, and 31% use electricity to power their primary heating sources. Only 9% of homes nationwide use oil. In contrast, oil is the most popular heating fuel in New England.

*For every unit of electricity the system uses, it provides three to four units of heating energy - an efficiency of 300% to 400%.

Furnace size generally refers to heating capacity. A furnace’s heating capacity rates how much heating power it provides. A correctly sized furnace impacts your home’s comfort and energy costs—a too-small or large furnace results in uneven or insufficient heating and high energy bills.

Your home’s square footage and climate zone are the two most essential factors in approximating your furnace’s capacity. An HVAC installer will provide additional information on the exact size and model you require.

Furnace heating capacity is measured in British thermal units (BTUs). A BTU is the energy required to increase the temperature of one pound of water by one degree Fahrenheit.

Heating capacity is not linked to furnace efficiency, expressed as the Annual Fuel Utilization Efficiency (AFUE) rating. Two units with the same BTU rating will produce the same amount of heat regardless of their efficiency ratings.

Square footage is the most significant factor in determining furnace size. Larger homes require more BTUs than smaller houses. Depending on the climate zone and other factors, homes need 30 to 60 BTUs of heating capacity per square foot.

Your home’s square footage can be found on the blueprints or closing documents. You can also determine the square footage with a measuring tape and a little math. Measure the length and width of each room. Multiply each room’s length by its width to obtain the room’s square footage. Add the square footage of every room to get the home’s total square footage. Basements are not generally included in square footage unless they are finished.

Your climate zone is the second most crucial factor in determining furnace size. 30 to 60 BTUs of heating capacity per square foot is a wide range; your climate zone helps to narrow it. There are five climate zones in the United States. Zone 1 is the warmest, and Zone 5 is the coldest. Colder climates require more heating capacity than warmer climates.

Homes in Zone 1, which includes Texas, Louisiana, and Florida, require 30 to 35 BTUs per square foot. Zone 1 homes might not require furnaces; heat pumps are probably sufficient for Zones 1 to 3. Homes in Zone 3, which includes Kentucky and most of Missouri and Virginia, need 40 to 45 BTUs per square foot. Homes in Zone 5, which includes Maine, Wisconsin, and Montana, require 50 to 60 BTUs per square foot.

While square footage and climate zone are the most significant factors in determining heating capacity, other variables help to narrow down the options even more. Square footage and climate zone give you a range of BTU ratings. Family size, windows, number of floors, sun exposure, roof color, ceiling height, ceiling fans, and insulation indicate your furnace’s capacity should be at the upper or lower end of the range.

• Family Size - Larger families require fewer BTUs because more people create more body heat dissipating into the surrounding air.
• Windows and Number of Floors - Two-story homes require fewer BTUs because the second story insulates the first level. Homes with a lot of windows, old windows, or windows with broken seals require more BTUs because heat escapes through them.
• Sun Exposure and Roof Color - Homes with plentiful sun exposure or dark-colored roofs absorb more heat from the sun, allowing fewer BTUs.
• Ceiling Height and Ceiling Fans - Houses with high ceilings require more BTUs because heat rises. Ceiling fans circulate air to create more even temperatures and reduce required BTUs. When running in reverse, fans push warm air down from the ceiling.
• Insulation - Insulation helps maintain temperatures in summer and winter. New homes with good insulation can use fewer BTUs. Older homes or houses with insufficient insulation require more BTUs.

Furnaces are available in three modes: single-stage, two-stage, and modulating. No particular type is the best for every house. Home size, climate, budget, and the length of time one plans to live in their home are the top factors influencing preference.

How long does a furnace last? The average lifespan of a properly maintained gas or oil furnace is 15 to 20 years, though they last 25 to 30 years in some cases. Electric furnaces generally last longer than gas or oil, 20 to 30 years on average.

Understanding the factors that affect furnace life expectancy will help you get the most out of your furnace. Size, installation, type of heating system, thermostat temperature, and maintenance impact a furnace’s lifespan.

Incorrectly sized furnaces have lower life expectancies, whether too large or small. Furnaces that are too large turn on and off more often to maintain the temperature, while furnaces that are too small run longer cycles. Both situations place additional wear and tear on furnaces.

Installation performed by someone other than a professional HVAC technician can result in impaired wiring, incorrectly installed fuel lines, incorrect drainage systems, and poorly installed, sealed, or sized ductwork.

Single-stage and two-stage systems are less likely to break down than modulating systems containing a computerized blower motor chip to monitor airflow.

Keeping the temperature too high or low shortens the furnace's life expectancy. The ideal range is between 60 and 80 degrees Fahrenheit.

Regular maintenance prolongs a furnace’s lifespan. Maintenance includes:

• Frequent filter changes
• Annual tune-ups and inspections
• Regular cleaning of heat registers
• Sealing leaks in ducts

Factor in how many years remain until your furnace hits the 20-year mark. For example, a furnace installed 14 years ago has six years left. To find its worth, multiply the remaining years in its life by its decreased value per year:

6 years x $200 = $1,200 remaining value

If the repair costs exceed 50% of the furnace’s remaining value ($1,200 / 2 = $600), replace the furnace. If the repair costs are less than 50% of the remaining value, repair it.

The final aspect to consider is your furnace’s performance. Check the amount of gas (not cost) currently consumed and compare it to previous years by examining old bills. If gas consumption has increased over the years without any changes to your home or lifestyle, your furnace may decline in efficiency. Replace it if it’s more than 15 years old.

What’s more unpleasant than your furnace giving out in the dead of winter? A furnace breakdown is inconvenient and could potentially lead to other problems like burst water pipes. You can avoid catastrophe by replacing your furnace when you observe signs suggesting a total breakdown is in the near future.

Signs that your furnace should be replaced:

• It’s more than 15 years old.
• Your energy bills have increased.
• Your furnace turns on and off more frequently, or the cycles are unusually long.
• Your furnace is struggling to heat your home or heats it unevenly.
• There are unusual noises or smells coming from your furnace.
• Your furnace’s components are rusty, corroded, or damaged.
• Your home is unusually dusty or humid.

Home Advisor says replacing a furnace costs $2,000 to $7,000, about $4500 on average. The total cost includes the price of the new unit (60% of estimate), labor (25% of estimate), materials, disposal of the old unit, and any local permit requirements (15% of estimate).

Factors affecting replacement cost include furnace type, size, efficiency, brand, and labor. Electric furnaces are the cheapest to replace, gas furnaces fall in the middle, and oil furnaces are typically the most expensive.

Furnace sizes range from 40,000 BTUs to 150,000 BTUs. Furnaces between 40,000 and 60,000 BTUs cost about $2,000 to $3,000. Furnaces between 125,000 and 150,000 BTUs cost about $3,000 to $6,500.

Highly efficient furnaces cost more than less efficient ones, but they can save you money by lowering your energy bills.

Like everything else, the furnace’s brand impacts its price. A Carrier furnace can cost more than twice as much as a Goodman furnace.

Labor costs for furnace installation by a licensed HVAC professional typically range from $50 to $100 per hour. Additional installers cost another $50 per hour. Issues regarding your current setup, ductwork installation, and ductwork repairs might increase the cost.

You don’t have to be a furnace expert to choose a great furnace that fits your needs. You have to know what factors are essential. HVAC installers are excellent sources of information, but you’ll want to understand what you're buying.

Consider these six things when choosing a furnace: energy efficiency, size, climate, installation cost, maintenance and warranty, and rebates.

Highly efficient furnaces are more expensive, but they save you money by lowering your energy bills. Upgrading from 80% AFUE to 95% AFUE will reduce your bill by about 15% each month. If your usual statement is $300, you'll save about $45. The ENERGY STAR® label identifies highly efficient furnaces.

Efficient furnaces are better for the environment. According to the U.S. Department of Energy, replacing an old 56% AFUE gas furnace with a 90% AFUE gas furnace in a cold climate reduces CO2 emissions by 1.5 tons yearly.

Furnace efficiency matters most in cold climates where heating costs are the highest. Lower energy bills might not offset the initial cost of a 90% AFUE furnace in locations with mild temperatures.

Your ideal furnace size is largely determined by your home’s square footage and climate. Family size, number and quality of windows, number of floors, sun exposure, roof color, ceiling height and fans, and insulation are less significant factors.

An undersized furnace won’t be able to keep your home at a comfortable temperature on frigid days. The furnace will run continuously to maintain the thermostat setting, which wastes energy, increases your bills, and puts wear and tear on the system.

An oversized furnace will heat your home unevenly and turn on and off more frequently. Some rooms will heat up quickly, and other spaces will remain cold. Frequent heating cycles strain the system.

Your climate region also plays a vital role in your furnace's type, size, and efficiency rating. Homes in moderate temperatures might benefit more from a heat pump over a furnace. Houses in mild climates can also get away with smaller, less-efficient furnaces. Homes in cold climates with long heating seasons require bigger furnaces and reap more benefits from efficient furnaces.

Remember to factor in the cost of installing the furnace. Furnace installation is complicated and requires an HVAC professional. The old equipment needs to be removed, and ducts and other equipment may need to be installed or moved. Labor costs for furnace installation by a licensed HVAC professional typically range from $50 to $100 per hour. Additional installers cost another $50 per hour.

The frequency and cost of maintaining your new furnace are essential considerations. Maintenance is often included in the terms and conditions of your warranty. Understanding your warranty’s length, terms and conditions, and coverage of parts and labor is crucial.

Incentives and rebates offered by the government for maintaining energy-efficient homes also affect the decision to buy a furnace. Purchasing specific heating systems or making other energy-related improvements to your home may qualify you for federal tax credits. Additionally, you may be eligible for savings through state and local government rebates by purchasing select Energy Star or Goodman products.

If you are shopping for a new furnace system, The Furnace Outlet can help. We specialize in direct-to-consumer heating and cooling equipement and offer the lowest prices on residential HVAC supplies online. Please contact our experts with any questions or concerns you may have, and we will be happy to help.