Full cost breakdown for new HVAC installation: equipment tiers, labor rates, permit requirements, federal tax credits, and what to verify in a quote.
New HVAC installation (in a home without existing ductwork) costs $10,000–$22,000 for a ducted system including ductwork installation. Replacing equipment in an existing system with functional ductwork costs significantly less — see our replacement cost guide for those ranges. This guide covers new installations.
Heat pump (equipment only, before installation): $1,500–$4,500 for mid-range models, $4,500–$8,000 for high-efficiency. Central AC unit: $1,200–$3,500. Gas furnace: $800–$2,800. Mini-split system (single zone, equipment only): $700–$2,500. Labor typically adds 40–60% on top of equipment cost in most US markets.
Adding new ductwork to a home costs $1,500–$4,000 for a single floor and $4,000–$12,000 for a multi-story home. Duct layout complexity, accessibility, and materials all affect this range significantly. In homes where ductwork is not feasible (older homes with plaster walls, historic properties), ductless mini-split systems are typically the most practical option.
Most US jurisdictions require a mechanical permit for new HVAC installation. Permit fees range from $75–$500 depending on municipality. The permit should be pulled by your licensed HVAC contractor, not by you as the homeowner — if a contractor asks you to pull the permit yourself, treat that as a red flag. The inspection is included in the permit fee and should be scheduled before the project is considered complete. See our contractor checklist for what to verify before signing.
Under the Inflation Reduction Act, qualifying heat pumps receive a 30% federal tax credit up to $2,000/year. Heat pump water heaters receive a separate credit up to $2,000. State-level rebate programs stack on top of the federal credit in many markets — the ENERGY STAR Rebate Finder tool lists current programs by zip code. These credits apply to the tax year the equipment is installed, not the year it's paid for.