Buying a Furnace

Buying a Furnace

Many people know very little about their first furnace, particularly when they buy a house with the furnace already installed. Homeowners often fail to do the necessary research when buying a second furnace, as well; instead, they open the phone book and call the first HVAC (Heating, Ventilation and Air Conditioning) contractor on the list. This strategy is likely to net you a furnace that will keep your house warm but may result in your spending hundreds, if not thousands, of dollars more than necessary.

How do you choose the most appropriate furnace?

Savvy furnace shoppers generally consider several criteria:

  1. Which fuel source should you use?
  2. Is your furnace correctly sized?
  3. Are you buying an appropriately efficient furnace?
  4. Are you getting the best price for your furnace?

Which Fuel Source Should You Use?

The most popular fuel sources for heating a home are gas, oil and electricity. When replacing a furnace, most homeowners will stay with the same fuel source because of the additional costs of switching over to a different source. Here is some information about each type:

  • Gas is the most popular way to heat a home, because it is relatively clean, convenient and usually among the least expensive fuels.
  • Oil furnaces are popular as well, especially in the Northeast. An oil furnace requires an indoor oil tank with a standard capacity of 275 gallons, meaning more room is needed for installation. It can also be dirtier than a gas furnace and, depending on oil prices, more expensive to run.
  • An electric furnace is an alternative to gas and oil. These units convert heat very effectively but can be an expensive option because of the cost of electricity.

Is your furnace correctly sized?

An oversized furnace — one whose capacity is too large — costs more to operate than a correctly sized furnace. This is because oversized furnaces cycle on and off too often — and cycling on and off is more expensive (and less energy-efficient) than running consistently for a long time.

The only way to know if your furnace is correctly sized is for your HVAC contractor to do a load calculation. A load calculation takes into account the size of your house, the insulation value of your windows, the amount of insulation in your walls and roof, and a host of other criteria to determine the appropriate furnace capacity. The industry accepted standard, the Manual J, is best performed by a professional contractor who has the necessary software and experience to easily complete the task.

Ask your HVAC contractor if s/he performed a load calculation before you accept the furnace they recommend. If you are replacing an old furnace (as opposed to buying a furnace for new construction) some contractors may argue that you should simply buy a furnace that’s as large as your previous furnace — but this assumes that the previous contractor selected an appropriately sized furnace. Request that they perform a load calculation, and find another contractor if they refuse.

Is the efficiency of your furnace appropriate for your house?

A furnace’s efficiency is commonly listed as its Annual Fuel Utilization Efficiency (AFUE). This rating describes the amount of heat that your furnace emits; for example, an 80 percent AFUE means that the furnace will convert 80 percent of the supplied fuel directly into heat.

High-efficiency furnaces typically cost more upfront than low-efficiency furnaces. However, they tend to cost less to operate on a month-to-month basis as they use less fuel to generate the same amount of heat. The amount of time it takes for the ongoing efficiency savings to offset the higher up-front costs is known as the “payoff period“. In many cases, once you take the payoff period into account, high-efficiency furnaces are cheaper than low-efficiency furnaces.

However, that’s not always the case. Your 90% efficient furnace will cost you more than your 80% efficient furnace if you move to a new house within the payoff period. And, depending on which furnace you choose, the payoff period may be surprisingly long! You need to consider a number of factors such as your climate, how long you plan to own your home, and whether rebates for a high-efficiency furnace are available.

Something else to consider is that higher efficiency equals higher complexity. This means that the parts to repair a higher efficiency furnace can be considerably more expensive, reducing or eliminating your long-term savings. Also, even if the part is under warranty, labor is usually not covered by the manufacturer’s warranty, meaning more out-of-pocket costs for you, the homeowner.

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Are you paying a reasonable price?

There are several ways to reduce the cost of purchasing and installing a new furnace.

  1. Traditionally, the best time to purchase a furnace is during spring or fall. If you are buying a higher-end, high efficiency furnace during the spring or fall, some manufacturers are likely to offer incentives, from low-interest financing to cash-back when installation is complete.
  2. Encourage several HVAC contractors to compete for your business. However, keep in mind that you rarely want to make your decision based on up-front price alone. Choosing a reputable HVAC contractor is as important in determining your overall satisfaction and cost as choosing an appropriate furnace.
  3. You can also negotiate the final cost of your new system. Negotiating the price of a new furnace is a balancing act. You don’t want to pay too much, and you don’t want to pay too little. One tool that you may find helpful in deciding whether a given contractor’s price is reasonable is the 2013 Furnace Price Guide. The report lists the prices of hundreds of furnaces from 25 different brands.
  4. In addition, many public and private entities in the U.S. and Canada offer rebates and financing incentives for the purchase of a furnace. Energy Star furnaces may qualify for a federal tax credit. Make sure you find out whether your purchase qualifies.

Other Considerations

While the factors listed above will be the most important considerations for your new furnace, there are other differentiators among the many available products. Depending on where the furnace will be located, you may want to select a unit that is listed as being particularly quiet; higher efficiency units may feature sealed combustion units, while multi-speed or 2-stage furnaces will be quieter than their counterparts since they often operate at low speed.

The type of thermostat you have installed with your furnace can make a difference in heat costs and comfort. Non-programmable thermostats, the type we’ve all had for decades, regulate temperatures manually. Programmable thermostats are set to automatically adjust the temperature throughout the day and night and can save between 10 and 30% in heating costs. They can be programmed differently for each day or maintain one set schedule for the entire week. And WiFi thermostats allow you to control the temperature remotely from your computer or phone.

In addition, it can pay to factor the warranty into your cost considerations. Provided you maintain your furnace appropriately, a longer warranty can translate to cost savings over the long run.

Choosing a Contractor

Just as important as choosing the right furnace is the need to select a qualified, licensed contractor to install it. In fact, most professionals agree that the installer is actually more important than the equipment when it comes to furnaces. This is because more service calls are due to poor installation than faulty equipment.

A good contractor will select correctly sized furnace for your home based on a load calculation. He or she will also identify and correct any other related problems, such as improperly sized ductwork. And, of course, a good contractor will install the equipment correctly.

How do you find the best contractor for your installation? Start by doing research. Begin with a contractor’s website, and look for online reviews. Check references of contractors you are considering. Often the best place to start is by asking friends and family about contractors they have used in the past. Make sure that a contractor is licensed and insured. Ask a lot of questions, and get estimates from at least two or three contractors. And remember, a lower price is good, but selecting the right contractor can save you money and trouble in the long run.

For more tips, read through this article on selecting the best contractor for your job.

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