How Much Does It Cost To Replace Your AC Unit?


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Replacing your AC unit is one of the biggest investments a homeowner can make and you need to have all the facts about what’s involved so you don’t find yourself in crisis mode when it comes time to replace your unit.

So let’s start with the biggest question: How much does it cost to replace your AC unit?

The average cost of replacing your AC unit is $7000 but it can vary anywhere between $4,000 to $12,000, depending on the size, specifications, and other varying factors such as the brand, durability, maintenance costs, and extra features. The price includes additional costs, such as labor costs, taxes, and permit fees. 

If you’re considering buying a new air conditioner, here are four important questions to ask yourself:

  1. What kind of cooling capacity do I need?
  2. Is a heat pump a good alternative?
  3. How long will it take for installation?
  4. Can I afford it?

Other factors that affect the price of air conditioners are efficiency or how well your air conditioning unit affects energy bills, and some vary when it comes to installation costs. Note that the installation costs alone can set you back at least $500 to $2,000, depending on the modifications to your existing system or if you are paying for a new unit installation.

However, those are not the only factors you want to consider when calculating the average cost, and this article will let you in on everything you need to know about replacing your air conditioning unit, including the type of AC unit you need, the average installation costs, energy costs, repairs, maintenance, and more.

By the way – before we get too far along here, if you want to connect with other homeowners and builders and get more great ideas for your home to make your space the best join my free private Facebook group, Remodel Reality here.

Before Replacing Your AC Unit

Before making a decision about whether to repair or replace your current system, consider the following factors:

  • How old is your current system? Older systems tend to consume more electricity than newer models.
  • What kind of maintenance has your current system received? Have you had it serviced recently?
  • Do you have a warranty? Most manufacturers offer warranties on their products. Make sure yours covers replacement parts and labor costs.
  • Is your current system still under manufacturer’s warranty? If so, you may qualify for a discount on a new system.
  • Are you willing to pay for installation services? Many companies charge extra for installing a new system. Ask your HVAC contractor about his pricing policies.
  • Does your home require additional insulation? If so, you might benefit from upgrading to a more energy efficient system.
  • Can you afford a new system? Replacement units can range from $4000-$12000 or more depending on brand and features. Consider other expenses that could arise if you decide to replace your existing system. For example, you might need to buy a new furnace filter, duct tape, or window screens.
  • Will you be able to install a new system yourself? If you plan to hire someone else to perform the job, ask him about his experience and qualifications. He might recommend hiring a professional installer instead.
  • What size is your house? Larger homes typically require larger systems.
  • How hot is your area? Hotter climates usually require more powerful systems.
  • How frequently do you use your AC? More frequent usage means higher operating costs.
  • How often do you clean your filters? Cleaning your filters regularly helps prevent dust buildup and reduces airflow resistance.

When to Change Your Old AC Unit

If it does not get cold or hot enough or when your air conditioner is not working the way it used to, that is probably the time for an air conditioner replacement. If you are hearing unusual noises, noticing damaged evaporator coils, and other unusual things about your old AC unit, getting a replacement is probably the next step.

Air conditioner replacement costs are not cheap, but good thing there are some sellers and appliance stores that offer good payment plans, which is helpful especially if you live in a larger home.

Some of the new units raise the industry standard, which is why more people are obliged to switch AC units before the hot summer months or the cold winter nights. Some of the newer options have indoor evaporator coils, a wide range of speed options, smart programmable thermostats, and more.

Another factor to consider is whether it’s even worth it to repair your old AC unit. For instance, in 2010 the Environmental Protection Agency (EPA) started phasing out the use of R-22 refrigerant used in many older units which they deemed harmful to the environment.

If your unit uses this type of refrigerant, it’s better to just replace the unit because the costs associated with it are astronomical now.

How to Calculate the Cost of Replacing Your Old AC Unit

If you want to know how much AC unit replacements cost and how much these new air conditioners will set you back, you should know each factor that affects the average price.

Knowing this will not only let you successfully calculate the costs, but this information will also help you know what type of AC unit will fit your needs to avoid frequent repairs and problems that would cause early unit replacement.

Type of Unit

Prices of units vary, depending on their size, square feet capacity, and seasonal energy efficiency ratio. The price will also be affected whether you are buying a small AC unit for a single bedroom or a central air conditioner for your entire home. The base price for a brand-new HVAC unit will cost anywhere between $1,000 to $12,000, depending on the size and brand. If you are just replacing your gas furnace, it’s going to be cheaper as the typical range of these units costs only $1,000 to $5,000.

The newest options available might be a little more expensive upfront, but you should consider how much money and time you will save in the long run since these newer units, although more expensive, are more energy efficient with higher efficiency ratings, and requires not-so-frequent regular maintenance.

Also, note that indoor and outdoor units also affect the price of your central air conditioning unit. If your eyes are set on replacing your entire HVAC unit, or just don’t know what type of unit you need for your case– here is a table that will explain various types of air conditioners and their national average prices including air conditioner installation costs.

 Unit  + Installation Minimum Cost Maximum Cost Description
Central Air Conditioner $3000 $8000 A centralized AC or HVAC unit costs higher than single-room ACs. Plus, they come in different types that may also affect the cost. The cost will also depend on the unit size.
Split-type AC $3000 $6000 This type of air conditioner unit is a lot easier to install, especially if you are only going to be using it in a single room or your office. However, unlike an HVAC– some mini-split systems only provide cold air without a heat pump. A much cheaper option is a window unit. However, this requires more work during installation.
Electric Furnace $1500 $3000 If you live in a region where it can get really cold, can get an electric furnace– which is the most affordable compared to gas and oil furnaces.
Gas Furnace $300 $5000 Gas furnaces are a little bit more expensive than electric ones because they are more energy efficient and require less maintenance than a traditional electric furnace.
Oil Furnace $5000 $7000 Oil furnace unit prices are the most expensive furnace option because it uses better technology. The unit replacement costs, if you are replacing an electric furnace with an oil furnace, may vary as well.
Portable Air Conditioners $100 $2000 If you need just the right amount of cool when working in your office or sleeping in your bedroom, there are cheap portable unit air conditioners that might do the trick. They might be cheap, but depending on the square feet of the area, they can be really effective. Plus, they won’t affect your energy bills a lot.
Heat Pump $5000 $7000 Heat pumps work just as well as furnaces and central AC units. However, they can be up to 175 to 300 times more efficient than ACs and furnaces.
Geothermal Heat Pump $20,000 $30,000 Geothermal heat pumps are the most expensive heating and cooling option for your home. However, if you have a big house and a budget to invest in comfortable living– a geothermal heat pump has the highest efficiency ratings of any central air unit.

Now that you know your different types of heating and central air conditioning system units that may be the best option for you, let’s dive into labor costs and learn what to expect when getting one of these condenser units and ductwork installed.

Size of the Unit

Unit Sizes vary between brands. And usually, if the unit size is bigger, it has higher power ratings and provides air to fill a larger area. Here is a chart to help you understand what type of AC do you need for the room you want to use it for– regardless if it’s a split-type or window unit.


Unit Size The average price range for units only BTU Square Foot House Coverage
1.5 Tons $2000 18,000 BTU 600 to 1000 square feet
2 Tons $2500 24,000 BTU 1000 to 1500 square feet
3 Tons $3000 36,000 BTU 1500 to 2000 square feet
4 Tons $3700 48,000 BTU 2000 to 2500 square feet
5 Tons $3700 60,000 BTU 2500 to 3300 square feet

Labor Costs

labor costs for air conditioner replacements range from $500 to $2500, depending on how complex the job is. For simple replacements without modifications to your home, walls, ductwork, etc., it is not going to take much time and it is not going to be too expensive.

Replacing a central air conditioner unit or HVAC can take around 5 to 10 hours. However, if there is extra work that needs to be done, it would take a day or two, which also means a higher fee for the more days of labor.

Some stores have an in-house air conditioning contractor, so the average homeowner doesn’t have to look for one for installing their new AC.

Some people with DIY experience tend to drop the installation costs and do the work themselves. However, it is always better to hire an experienced professional to do the work, especially if you don’t want to experience problems in the future. Plus, there are payment plans if you are going to spend more than you have right now on a new AC.

Additional Costs

Aside from the AC unit replacement costs and air conditioner installation, there may be additional costs to expect. replacing an AC unit is quite simple if you don’t need to fix ductwork or additional construction costs for smaller or older homes. However, most of the time when replacing your AC or anything else in your home for that matter, you will always discover something that needs to be repaired or replaced– not unless you are living in a brand-new home.

Ductwork Modification

When replacing your air conditioning system, you already have the ductwork installed from your old system. However, in most cases, you might need to repair or reroute your ductwork depending on the condition. If you are getting a new HVAC or central air conditioning unit, you will need properly working for better ventilation and efficiency. Note that ductwork installation and repairs can cost anywhere between $1000 to $4000, and that is not included in the calculation of prices for AC units listed above.

Removal and Disposal of Old AC Unit

Sometimes the cost of replacing your AC includes the removal and disposal of your old unit, so you won’t have to worry about where to put the broken unit when the installation is done.

Additional Zones

Adding more zones of coverage to your HVAC can significantly raise the prices of your AC installation, as well as your monthly utility bills because of the extra power needed from your AC unit.

If you decide to add new zones, you are looking at an additional $2000 to $3000 cost for the additional work and the additional thermostats needed to control the temperature in the particular zones. Energy costs will also increase, but the good news is that the newer systems have much higher efficiency ratings.


A thermostat is essential for any HVAC or air conditioning unit because it will allow you to set a specific temperature for your entire home or specific areas in your household. It will cost $100 to $300, depending on the type.

Modern thermostats have wifi connectivity, which will enable you to control your home’s temperature with a wifi connection, even when you are out of the house. It is an excellent way to save energy when you are not home, and get your HVAC running just in time before you arrive.


Adding insulation is an additional cost, which is not included in most HVAC installations. If you live in an older house that can get really cold and drafty during the winter, additional insulation can help your AC system to run more efficiently, which can decrease the need for extra power coming out of the central air conditioner unit– ultimately leading to less maintenance and a more affordable electric bill.

But depending on the area, adding insulation to your home can set you back $1000 to $2300, depending on the size of the project.  And that fee would go on top of the $4000 to $12000 cost of the thermal units and installation.


Upgrades and ad-ons such as a zone system, humidifier, UV lighting, fans with variable speeds, and other smart devices for your central air conditioner units can set you back a lot of money. If the basic package costs around $8000, the additional features will probably cost you around $3000 to $6000 more. If you are on a tight budget, you might want to skip some of the necessary luxuries and just go for the fully-functional basic AC package.

Are there hidden HVAC installation costs?

It’s vital that you vet your AC contractor before you hire them because some AC installers and contractors will not tell you about some hidden fees before the installation process, and you could end up with a bill that’s a lot bigger than you were expecting. So do your homework and read reviews and testimonials so you can beware of these companies and learn what are the possible hidden fees they might add to your final bill. Some of the hidden fees they might add are:

  • Local county permits from the building department
  • Asbestos removal
  • Extra plumbing, electrical, disposal work

To avoid being surprised by hidden fees when it’s time to pay the bill, you might want to be straight with your installers and tell them that you want to know all the costs beforehand.

Is it Worth Getting a More Expensive HVAC System?

If you have a bigger budget, getting newer AC systems is an excellent choice for better living quality. Although they can drastically increase in price, you will save more money in the long run because of the lower electric bills and less need for more frequent maintenance.

If you are on a budget, there are low-priced installations that will only include the essentials. Plus, some cheap installations might not even get the proper permits and choose the right HVAC SEER rating for your home, which can cause problems in the future.

Next Steps

Want to join others who are creating the most amazing home redesigns & renovations and get more tips, tricks and hacks on how to make your home the best it can be?

Join my brand new free private Facebook group, Remodel Reality to connect with other people like you to make your space the best!

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Rob Orr

Me and my family have lived through a nightmare of a remodeling project gone wrong, making countless mistakes including placing trust in the wrong hands. Despite these setbacks, we took matters into our own hands for many aspects of the remodel, ensuring quality workmanship guided by expert advice. Through my personal experiences, I've created My mission is not only to share the pitfalls we encountered but also the successes we achieved by combining our efforts with trusted professionals. By sharing both the highs and lows of our journey, I aim to help others navigate their own remodeling projects with greater confidence, ensuring they benefit from our lessons learned.

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