Are you a Greenwood homeowner dealing with a failing heating system? On average, furnace replacement in Greenwood, IN, ranges from $2,500 to $7,000 on up, depending on the unit’s efficiency and your home’s size. Below, Thiele Heating & Air Conditioning breaks down exactly where that money goes and how to budget for your installation.
Breaking Down Your Furnace Replacement Costs
When it comes to your furnace installation, the price can vary quite a bit from one home to the next. The type of furnace, the size of your home, and the work required to install the system all play a role in what you’ll ultimately pay.
Understanding these factors ahead of time helps set realistic expectations and makes it easier to plan for a furnace replacement that fits your home and budget. Here are the main things that influence your furnace replacement cost:
Type of Furnace
The type of furnace you choose goes a long way in determining your overall furnace replacement cost. Different systems come with different upfront prices, operating costs, and installation complexity.
Here’s what you need to know about the most common furnace options and how they affect pricing.
Gas Furnaces
Gas furnaces remain one of the most common choices for Central Indiana homes because they’re reliable and cost-effective to operate. If a gas line is already in place, installation is usually straightforward. For 2026, average gas furnace replacement costs typically range from $3,500 to $6,500, including installation. A natural gas furnace offers strong performance and solid energy efficiency for cold winters.
Electric Furnaces
Electric furnaces generally have lower upfront equipment costs and simpler installations, which can make them appealing in certain situations. That said, they often result in higher energy bills during colder months. In 2026, electric furnace installation typically falls between $2,500 and $5,500. While easier to install, energy consumption is an important factor to consider long term.
Oil Furnaces
Oil furnaces are less common today but are still used in homes without access to natural gas. They tend to cost more to install and maintain due to fuel storage and system complexity. For 2026, oil furnace replacement costs usually range from $4,000 to $7,500, depending on installation conditions and fuel availability.
Hybrid Furnaces
Hybrid systems combine a gas furnace with electric components, often working alongside a heat pump to maximize efficiency throughout the year. These systems automatically switch between energy sources based on outdoor conditions. In 2026, hybrid furnace systems typically range from $4,500 to $9,000, depending on system design and installation needs.
High-Efficiency Furnaces
High-efficiency furnaces are designed to use less fuel while delivering the same amount of heat. These systems are rated by AFUE (Annual Fuel Utilization Efficiency), which measures how much of the fuel you pay for is converted into usable heat.
For example, a 96% AFUE furnace turns 96% of its fuel into heat, with only 4% lost through exhaust. In 2026, high-efficiency furnace installations typically range from $4,000 to $9,500, and while the upfront cost is higher, the improved efficiency can lead to lower monthly energy bills over time.
Labor Costs
Labor is a significant part of your furnace installation cost and can vary based on the layout of your home and how involved the install is. In 2026, typical labor costs in Central Indiana generally range from $1,800 to $3,500. This usually covers removing the old furnace, installing the new system, connecting it properly, testing operation, and making sure everything meets code.
Additional Costs to Consider
Along with labor and the specific type of furnace, a few other items can affect your total furnace replacement cost:
- Furnace Features and Technology: Some furnaces cost more because they include features like two-stage heating, variable-speed blower motors, and advanced control boards. These features allow the furnace to adjust its output instead of running at full power all the time, which can lead to steadier temperatures and quieter operation. While these options raise the upfront cost, they can improve day-to-day comfort and efficiency.
- Ductwork Modifications: If your existing ductwork needs repairs, resizing, or sealing to work properly with the new furnace, this can add to the overall cost. Older homes or systems that weren’t sized correctly in the past often need these updates.
- Permits and Inspections: Furnace replacements in Greenwood, IN, typically require a mechanical permit and inspection. The permit itself is usually a small portion of the overall cost and is handled as part of the installation process. An HVAC contractor takes care of pulling the permit and coordinating the inspection.
- New Thermostats or Controls: If your current thermostat isn’t compatible with the new furnace—or if you want to upgrade to take advantage of smart thermostat features like programmable schedules, remote access, and system performance alerts—a new thermostat may be recommended. While a thermostat upgrade offers real benefits, it does add to the upfront cost of a furnace installation.
Your furnace replacement costs will depend on your home’s existing setup and the type of heating system you choose. The easiest way to know what to expect is to schedule a free estimate with an experienced HVAC contractor like Thiele, so everything is clearly outlined upfront.
We Have Furnace Financing Options Available
Replacing your home’s heating system is a big deal, but the benefits of more reliable heating, advanced features, and energy savings make investing in a new unit worth it. If you’re worried about affording a new furnace, let us help.
Thiele offers financing options for HVAC equipment subject to credit approval. We also regularly run promotions throughout the year that can help you save money on your furnace replacement. We keep our prices competitive, but if there’s a way to lower your total cost, we’ll help you find it.
When It’s Time To Replace Your Furnace
Knowing when to replace a furnace usually comes down to a few clear signs. Most furnaces can be repaired along the way, but older furnaces in particular reach a point where fixing them isn’t the best move. Here are the situations where a furnace replacement is required or recommended:
- Cracked Heat Exchanger: This is a safety issue, not just a comfort problem. A cracked heat exchanger can allow dangerous exhaust gases to mix with indoor air, and replacement is almost always the only option.
- Major Repair: Failures involving the blower motor, control board, or other core components can be expensive and signal that the furnace is reaching the end of its useful life.
- Frequent Repairs: When service calls become a regular thing instead of an occasional event, it’s a sign the system is wearing out. Repeated breakdowns usually mean more problems are coming.
- High Repair Cost: When a single repair cost climbs high enough, continuing to fix the system often stops making financial sense, especially if utility bills are already rising due to declining efficiency.
Replacing an aging furnace can bring noticeable benefits, including improved energy savings, more consistent comfort, and quieter operation. When it’s time to move on from older systems, we’ll help you find the right replacement for your home. As a Bryant Authorized Dealer, we carry some of the best furnace models on the market today.
Furnace Services to Support Your New Heating System
Most furnaces last around 15 to 20 years, and how well they’re cared for plays a big role in that longer lifespan. At Thiele, we focus on keeping your heating system working properly year after year. Our furnace services include:
- Furnace Repair: When something isn’t right, our technicians handle everything from thermostat issues to worn blower motors and gas valve problems. Each service call is focused on restoring safe, reliable operation as quickly as possible.
- Furnace Maintenance: Ongoing furnace maintenance helps prevent breakdowns and keeps efficiency from slipping. We recommend routine maintenance once or twice a year to reduce wear, catch small issues early, and avoid premature replacement.
- HVAC System Maintenance Plans: Many homeowners choose our maintenance plan to simplify care for both their furnace and air conditioner. The plan includes regular maintenance, priority service, and repair discounts, helping both systems stay reliable throughout the year.
Thiele Heating & Air Conditioning is known for great reviews because we show up, do the work right, and stand behind it. We serve homeowners throughout the Greenwood area, including neighborhoods like Center Grove, Valle Vista, Old Town Greenwood, and areas along Smith Valley Road and Main Street. You can count on experienced technicians and reliable service from a company that’s been trusted since 1883.
Get a Free Furnace Replacement Estimate From Thiele
Now that you have an answer to how much does it cost to replace a furnace?, the next step is finding the right furnace for your home. Thiele Heating & Air Conditioning helps you make an informed decision with clear pricing and honest recommendations, never pressure. Schedule your free estimate today so your home is ready and comfortable all winter long. For expert work and the accurate furnace replacement cost Greenwood, IN, depends on, talk to Thiele!