Does A New Furnace Increase Home Value? (Explained)
Upgrading your furnace is a big decision, both for comfort and for your wallet.
If you're planning to sell your home soon, you might be wondering if a new furnace is a worthwhile investment.
Sadly, installing a new furnace will NOT increase your home value.
A working furnace is an expectation, and it's not a selling point.
In this post, I’ll break down if (and how) a new furnace could increase your home value and when it should be replaced. Plus, I’ll give a quick rundown of the benefits.
Does A New Furnace Add Value To Home?
A new furnace will not add any value to your home's sale price.
That is unless your unit straight-up doesn't work at all versus having a functioning one.
If it doesn't work, you will get a lower sale price - so installing a new one adds value.
But if the furnace is already operational, even if it's getting older, you're usually better off just leaving it be rather than replacing it solely for resale value.
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An Alternative If Your Furnace Is Outdated
One good option is offering a home warranty for the first year after the sale.
That covers the furnace along with all the other major appliances and systems in the house.
It gives buyers peace of mind knowing they're protected if anything goes wrong, without you having to foot the full bill of a furnace replacement out of pocket beforehand.
Plus, a one-year home warranty is way cheaper for you than paying for an entire new furnace and installation costs.
Other Benefits Of Installing A New Furnace
Now, there are a number of other ways a new furnace will help with the house sale:
#1 Appealing To Buyers
Even if a new furnace doesn't directly translate to a higher sale price for your home, it's still going to make your property way more attractive to buyers.
People want a house that's move-in ready, without a bunch of immediate expenses and headaches to deal with.
Knowing they've got a brand new, efficient furnace that's going to last for years?
That's a huge selling point.
Buyers will have one less thing to worry about.
#2 Energy Savings
A new furnace is going to save you a ton of money on your energy bills.
I'm talking potentially 20 - 25% or more in savings compared to an older, less efficient model. Modern furnaces are just way more efficient.
Some models might even top out at 95% efficiency or higher!
Even if the upfront cost might seem steep, you'll make that money back over time through all those savings on your heating costs.
It's a smart investment if you plan to hold on to the house for a while.
And if you are selling it, this would be very attractive to buyers.
#3 Better Indoor Air Quality
A new furnace will improve the indoor air quality too.
Older furnaces can really circulate a lot of dust, dirt, and other nasty particles throughout your home's air supply as they age.
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This can aggravate allergies, asthma, or just make things feel less fresh inside.
Modern furnaces have much better air filtration and don't degrade air quality.
So you'll be able to breathe easier with a new system.
#4 More Consistent And Reliable Heating
Another benefit is just getting way more consistent, reliable heating performance.
Older furnaces constantly cycling on and off, having hot and cold spots, or struggling to keep up on the coldest days is frustrating.
Newer models keep an even, comfortable temperature throughout your home without those annoying fluctuations.
You can set it and actually forget about it!
Plus, newer models are built to be more dependable, reducing the chances of unexpected breakdowns, especially during the coldest months.
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When You Should Replace Your Furnace
Like I said, if the furnace is working well - leave it alone.
But if its falls under any of these categories, you might want to consider replacing it:
If Its Not Working
If your furnace just straight-up isn't working at all, you've got to replace it.
Trying to do major repairs on an old, outdated furnace is usually not worth the money compared to just getting a new system installed.
A house with no working furnace is extremely difficult to sell.
So replacing that non-functioning unit is a must to restore the home's value and appeal.
It Needs Frequent Repairs
Every furnace needs some maintenance, but if you find yourself calling for repairs all the time, that's a major red flag that the unit is simply nearing the end of its expected lifespan.
Each repair just buys a little more time before the next issue.
Those repair bills can really start adding up fast to the cost of a new replacement furnace.
At that point, it makes more sense financially to just get ahead of the problem and replace it.
Buyer Requests
An old or poorly working furnace can be an issue that prospective buyers will zero in on during showings. It can show up as a red flag on home inspections too.
It can hurt your offers and final sale price if buyers factor in the cost of replacing it.
If multiple buyers are flagging the furnace condition as a concern, it's smart to just replace it rather than trying to brush it off or offer a credit.
Or like I said, you could offer home warranty for a year instead.
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If Its A Safety Risk
Most importantly, if there are any potential safety risks at all involving your furnace, you must replace it ASAP.
As furnaces get really old, hazards like cracked heat exchangers leaking carbon monoxide, excess burnt particles blowing into the air, or even fire risks become way more likely to occur.
An outdated furnace with a cracked heat exchanger is extremely dangerous.
Protecting your family's health and safety has to come before any financial considerations when it's a risk. The consequences are just too severe otherwise.
If Its It’s Super Old And Outdated
Furnaces usually last about 15 to 20 years.
If yours is getting close to this age or is even older, it might be time for an upgrade.
Old furnaces aren't as efficient, which means you're paying way more than needed on heating bills each month.
Getting a replacement with one of the modern, high-efficiency furnace models can dramatically slash those heating costs while adding value through the improved energy savings and overall home comfort.