Furnace pricing isn’t one-size-fits-all, and that can make planning difficult. Whether you’re installing a new system or replacing an older furnace, understanding what affects the numbers is important for avoiding surprises and protecting your budget.
This 2026 guide by Thiele Heating & Air Conditioning breaks down your furnace installation cost in Indianapolis and also shares a few ways that we can help you save more money.
Understanding the Cost of a New Furnace Installation
Installing a furnace in a home that’s never had central heating is different from replacing an old system. This often applies to new homes, additions, or older houses that used other types of heat. Because the heating system is being added for the first time, the work usually involves more planning, equipment, and labor, which affects the overall furnace installation cost.
Below are the main factors that affect the total cost of a brand-new furnace installation.
Furnace Type and Fuel Type
One of the biggest factors in your furnace installation cost is the type of furnace being installed. In Indianapolis, natural gas furnaces are the most common choice, but electric furnaces and oil furnace systems are also used in certain situations. Each fuel type comes with different installation needs, energy efficiency levels, and operating costs. Those differences affect both the upfront cost of the new furnace and what you can expect to pay in energy bills over the long term.
Furnace Size and Home Square Footage
Furnace size is determined by your home’s square foot, insulation, layout, and heating demands. Size is measured in British thermal units (BTUs), which indicate how much heat the furnace can deliver. A furnace that’s too small may struggle during colder weather, while an oversized system can waste energy and raise operating costs. Proper sizing plays a key role in furnace efficiency and keeping heating bills predictable.
Efficiency Ratings and High-Efficiency Furnaces
Furnace efficiency has a direct impact on ongoing energy costs. Furnaces are rated by Annual Fuel Utilization Efficiency (AFUE), which measures how efficiently fuel is turned into heat. High-efficiency furnaces use less fuel and help lower energy bills, but they usually come with a higher upfront cost. In some cases, choosing an energy-efficient furnace may also open the door to tax credits that help offset the initial investment.
HVAC System and Installation Requirements
Installing a furnace often involves more than placing a new unit. The HVAC system may require new venting, gas line connections, electrical work, or ductwork to support the furnace properly. These installation requirements add to both labor costs and material costs and have a major impact on the total cost. The more infrastructure that needs to be added, the more time and planning the project requires.
Labor Costs and Professional Installation
Labor costs depend on the scope of the installation, how long the work takes, and the condition of the home. Professional installation ensures the furnace heating system is set up safely, meets code, and runs as intended. Installation issues can lead to higher energy costs, more frequent furnace repair, and reduced system life, which increases the overall cost over time.
Furnace Replacement Costs and What to Expect
The cost of a furnace replacement differs from the cost of a new installation. In a replacement, there’s already an existing furnace and a heating system in place. That often means less setup work, which can help keep labor and material costs lower—but replacement still comes with its own factors.
Your furnace replacement cost usually includes removing the old furnace, setting the new unit in place, and connecting it to the existing ductwork. The new furnace also needs to be properly sized for the home. If the old furnace was outdated, inefficient, or the wrong size, adjustments may be needed to improve furnace efficiency and overall energy efficiency. Costs can also increase if ductwork needs to be updated or if the current system doesn’t meet today’s code requirements.
While replacing a furnace is often more straightforward than installing one from scratch, it still takes planning to make sure the right furnace is chosen and installed the right way. The furnace replacement cost Indianapolis homeowners pay varies significantly, so you’ll want to explore your options and get a quote from a reputable company before committing to anything.
How Much Does a New Furnace Cost?
That’s the big question, isn’t it? The cost of a furnace depends on what you’re doing—new installation or replacement—as well as the type of furnace, size, brand, and features. Here’s a general pricing breakdown to give you a good starting point.
Average Cost for New Furnace Installation
For a brand-new furnace installation in Indianapolis, most homeowners can expect the total cost to fall somewhere between $5,500 and $10,500. Where you land in that range depends on the furnace make, efficiency rating, labor costs, and whether extra work is needed for venting, electrical, or other setup. High efficiency furnaces and larger systems tend to land toward the higher end of the range.
Average Cost to Replace a Furnace
Replacing a furnace is often less expensive than a brand-new installation since the heating system is already in place. In Indianapolis, furnace replacement costs commonly range from $4,000 to $8,500. The final price depends on the type of furnace, efficiency level, and the condition of the existing furnace and ductwork. If updates are needed to make everything fit or meet code, the overall cost can increase.
Financing Options for a New Furnace Are Available
A new furnace is a big purchase, and paying for it all at once isn’t always possible or the best thing for your budget. Thiele Heating & Air Conditioning offers financing options for new Bryant furnace systems. Financing is subject to credit approval, with an application process that’s quick and easy.
Financing can help you move forward with the upgrade that you need now. You can apply online through our website or contact our team if you’d like to talk through your options.
From Choosing the Furnace to Installing It—Thiele Can Help
Thiele Heating & Air Conditioning has been installing furnaces in Indianapolis area homes since 1883. We work with natural gas, electric, and oil furnaces, and we handle both new installations and furnace replacements. Our team helps you sort through your options, choose the right furnace for your home and budget, and get it installed quickly.
We also look for ways to help you save. That can include financing, seasonal promotions, manufacturer rebates, or available tax incentives. If there’s an opportunity to lower your furnace price, we’ll find it! We also handle furnace repair, ongoing furnace maintenance, and offer a maintenance plan to help protect your system as it ages. With flexible scheduling and some of the industry’s best technicians, we make the process smoother and less stressful—exactly what you need and deserve.
Get a Quote for a New Furnace Installation in Indianapolis
Thiele Heating & Air Conditioning has helped hundreds and hundreds of Hoosiers across Central Indiana stay warm since 1883. From new furnace installations in older homes to replacements in more modern buildings, we’ve seen it all—and we’re ready to help you too. For the furnace installation Indianapolis trusts, call Thiele!