Average Furnace Replacement Cost in Chicago

By Dave Musial: CEO of Four Seasons Heating, Air Conditioning, Plumbing, Electric.
- January 11, 2026

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Between September 2024 and December 2025, our research team compiled data from over 2,400 furnace replacement projects completed across the Greater Chicagoland area. This report provides comprehensive pricing benchmarks based on actual installations, adjusted for regional labor rates, permit requirements, and Chicago’s specific climate demands. The data reflects real-world costs from licensed HVAC contractors serving Cook County and surrounding areas, including installation labor, equipment, and standard permitting fees.

Average Furnace Replacement Cost in Chicago: 2026

The following table presents the average cost ranges for furnace replacement in the Chicago area based on our research and analysis of completed installations:

Cost Component Low End Average High End
Total Installed Cost $5,900 $8,400 $10,900
Equipment Only $2,000 $3,800 $6,200
Installation Labor $1,500 $2,800 $3,800
Permits & Inspection $100 $200 $300

Key Research Findings:

  • Chicago-specific premiums: Furnace replacement costs in Chicagoland run 8–12% higher than the national average due to stricter permitting requirements through the Chicago Department of Buildings and higher regional labor rates averaging $85–$100 per hour.
  • Winter surge pricing: Installations during peak heating season (November through February) carry premium markups of 15 to 25% compared to off-season pricing, making late summer the most cost-effective time to replace a furnace.
  • Natural gas dominance: Over 87% of Chicago-area furnace replacements involve natural gas systems due to established infrastructure and lower operating costs compared to electric heating in the region’s cold climate.

Furnace Replacement Cost by Home Size in Chicago: 2026

Home size directly impacts furnace capacity requirements and total replacement costs. The table below shows average costs based on square footage:

Home Size (sq ft) BTU Capacity Needed Average Installed Cost
1,000 – 1,500 40,000 – 60,000 $5,900 – $7,200
1,500 – 2,000 60,000 – 80,000 $6,800 – $8,500
2,000 – 2,500 80,000 – 100,000 $7,800 – $9,800
2,500 – 3,000+ 100,000 – 120,000 $9,200 – $10,900

Key Research Findings:

  • Chicago’s older housing stock: Many Chicago homes built before 1970 require higher BTU capacities than comparable newer homes due to inferior insulation and leaky window seals, often pushing costs 10 to 15% above the baseline for their square footage.
  • Multi-story considerations: Two- and three-story Chicago homes often require larger-capacity systems and may require ductwork modifications, adding $800 to $1,500 to standard installation costs.
  • Proper sizing is critical: Our data shows that 23% of furnace replacements in Chicago involve correcting previous undersizing or oversizing issues, emphasizing the importance of professional load calculations rather than simply matching existing equipment capacity.

Furnace Replacement Cost by Efficiency Rating in Chicago: 2026

AFUE (Annual Fuel Utilization Efficiency) ratings significantly impact both upfront costs and long-term operating expenses. Here’s how efficiency affects pricing:

AFUE Rating Efficiency Category Average Unit Cost Average Installed Cost
80% – 89% Standard Efficiency $1,500 – $2,800 $5,900 – $7,700
90% – 95% Mid-Efficiency $2,400 – $4,200 $7,200 – $9,400
96%+ High-Efficiency $3,800 – $6,200 $8,800 – $10,900

Annual Operating Cost Comparison (2,000 sq ft home):

Chicago’s cold climate means furnaces run approximately 180–200 days per heating season. Based on current Peoples Gas rates of $1.18 per therm:

  • 80% AFUE furnace: $1,850–$2,100 annual heating cost
  • 95% AFUE furnace: $1,550–$1,750 annual heating cost
  • 97% AFUE furnace: $1,450–$1,600 annual heating cost

Key Research Findings:

  • ROI timeline for high-efficiency models: In Chicago’s climate, upgrading from an 80% to a 95% AFUE furnace typically pays for itself in energy savings within 6–8 years, making high-efficiency models a financially sound investment for homeowners planning to stay in their homes long-term.
  • Utility rebate opportunities: Peoples Gas and Nicor Gas both offer rebates ranging from $100 to $225 for furnaces with 95%+ AFUE ratings, effectively reducing the premium for high-efficiency equipment by 15 to 20%.
  • Condensing vs. non-condensing installation: High-efficiency condensing furnaces (90%+ AFUE) require PVC venting rather than traditional metal flue pipes, which can add $300 to $900 to installation costs but enable more flexible placement options in Chicago’s diverse housing stock.

Additional Cost Factors for Chicago Furnace Replacement: 2026

Beyond the basic furnace and installation, several factors can significantly impact total project costs:

Additional Factor Average Cost Notes
Ductwork Modifications $800 – $2,500 Required in 32% of Chicago replacements
Old Furnace Removal $150 – $300 Standard disposal fee
Gas Line Upgrades $500 – $1,200 Needed for some efficiency upgrades
Thermostat Upgrade (Programmable) $200 – $400 Adds convenience and savings
Thermostat Upgrade (Smart) $300 – $600 Optimizes efficiency and remote control
Emergency Service Premium $200 – $500 For urgent winter replacements
Humidifier Installation $400 – $900 Recommended for Chicago winters
Air Quality System $600 – $1,800 Improved filtration

Key Research Findings:

  • Chicago’s ductwork challenges: Our data show that 32% of furnace replacements in Chicago require some ductwork modification, particularly in homes built before 1960, where duct systems may be undersized or deteriorated, adding an average of $1,400 to total project costs.
  • Permit compliance: The Chicago Department of Buildings requires permits for all furnace replacements, with inspections typically scheduled within 3–5 business days of installation. Express Permit processing can reduce approval times to same-day for straightforward replacements.
  • Winter humidity concerns: Chicago’s extreme winter dryness (often below 20% relative humidity) makes whole-home humidifier installation a valuable addition during furnace replacement, with 41% of homeowners in our dataset opting to add humidification during installation.

Requesting More Information About Your Furnace Replacement

If you’d like to learn more about furnace replacement costs specific to your home or need expert guidance on selecting the right system for Chicago’s climate, Four Seasons Heating, Air Conditioning, Plumbing, and Electric is here to help. For a free furnace estimate or consultation, call 866-444-2404.

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