Should I buy a house with a 20 year old furnace?

Buying a house with an old furnace

Yes, if the deal pays for a new one. The International Association of Certified Home Inspectors (InterNACHI) gives a furnace 15 to 25 years, so plan to replace a 20 year old furnace soon. Before your deadline, have a licensed heating, ventilation and air conditioning (HVAC) technician check it and write up a replacement bid. Then ask the seller for a credit in that amount.

Key takeaways

• Replacement plus hauling the old unit away runs $2,973 to $7,227 on HomeAdvisor's national figures, and gas and oil units alone can run up to $10,000.
• If a repair bid nears 50% of the cost of a new system, Carrier says to weigh replacement before you pay for the repair.
• The federal tax credit for a new furnace covers only installs made through December 31, 2025.

How old is too old for a furnace?

The furnace makers draw the line earlier than the inspectors. Carrier puts a new furnace's typical life at 15 to 20 years. American Standard says a furnace 15 or older is at or near the end of its expected life. For a 25 year old furnace, Carrier highly recommends replacement.

One part ages faster. InterNACHI's chart gives a heat exchanger only 10 to 15 years.

If your report gives no age, the serial number on the unit's nameplate frequently includes the month and year it was made, per American Standard. Also check whether "old HVAC" on your report means the furnace, the air conditioner, or both. An old AC is its own line with its own cost; see old AC unit or R22 on an inspection report.

Is a 25 year old furnace safe?

Age alone doesn't answer that. A technician who opens the unit does. The Environmental Protection Agency (EPA) lists "worn or poorly adjusted and maintained combustion devices (e.g., boilers, furnaces)" among the sources of carbon monoxide in a home. The same page notes that the Consumer Product Safety Commission (CPSC) urges an annual professional inspection of all fuel-burning appliances, furnaces included.

If you smell gas at the house or a carbon monoxide alarm goes off, leave. Call 911 or the gas company from outside, then a licensed HVAC technician. American Standard says a rotten-egg smell may mean a gas leak, and the CPSC says: "If you suspect CO poisoning, get outside to fresh air immediately, and then call 911."

If the report names a cracked heat exchanger, carbon monoxide, or backdrafting, get a licensed HVAC technician out before your deadline, and before any talk about money. Cracked heat exchanger on an inspection report covers that finding on its own.

How much does it cost to replace an old furnace?

Fuel type and efficiency rating set where you land. HomeAdvisor says most homeowners spend around $4,814. National ranges:

Sources: HomeAdvisor for the typical range and removal, This Old House for unit cost by fuel type (its figures come from HomeAdvisor).

Here is what that means for your ask. HomeAdvisor's typical range plus removal is $2,823 + $150 = $2,973 at the low end and $6,897 + $330 = $7,227 at the high end. An oil furnace's unit cost alone starts at $6,750. Treat these as placeholders until the technician's written bid replaces them.

Is it worth fixing a 20 year old furnace?

The repair bid decides it. Carrier suggests weighing replacement once a system passes 10 years, especially when repairs come more often. Its second test is cost: if a repair approaches 50% of a new system, compare the two before you commit.

Repairs vary widely. American Standard puts them anywhere from $100 up to $3,000 to replace a cracked heat exchanger. Have the technician price both the repair and a full replacement on the same visit, then compare the two numbers.

What do I ask the seller for?

Ask for a credit that matches the technician's written replacement bid, removal included. A credit lets you choose the contractor, the fuel and the efficiency level. A line like this works:

Furnace, 20 years old per the inspection report: credit for replacement, including removal of the old unit, per the attached written quote from a licensed HVAC contractor.

If you can't get a technician out in time, how to get repair estimates during the inspection period covers the faster ways to a figure. What to ask for after a home inspection shows where this line fits, and the buyer repair request letter template gives you the wording around it.

If the seller offers to replace it instead, ask that a licensed HVAC contractor do the work, and get the invoice and any permit before closing.

What if the seller says no?

You have three moves:

• Take a smaller credit and budget the rest of the replacement yourself.
• Ask for a price reduction of the same amount instead.
• Walk away if the number doesn't work and your contract allows it. When to walk away after a home inspection covers how to weigh cost against what you still don't know.

Your contract sets the exact deadline and terms, so confirm them with your agent or attorney.

What is the $5,000 rule for HVAC?

CBS News describes it as the system's age times the repair cost. Above $5,000, replacement is often the better choice; below it, repair may make more sense. At 20 years, any repair over $250 crosses the line (20 x $250 = $5,000).

Is there a tax credit for a new furnace?

Not for a furnace installed in 2026. The federal energy efficient home improvement credit covered qualifying gas, propane and oil furnaces, up to $600 per item. The IRS says you can claim it for improvements made through 2025, so a 2026 install falls outside it. A tax professional can confirm how that applies to you.

How do I know what the rest of my list is worth?

The technician's bid covers the furnace, but your report has other lines. Kept prices every line of an inspection report for $79, usually under 4 hours, and marks the ones that need a professional's quote.

If the furnace is one finding among many, upload your inspection report to Kept and spend your remaining days on the HVAC bid.

Sources

• InterNACHI, Standard Life Expectancy Chart
• Carrier, Furnace Repair vs Replacement: Costs and Decision Guide
• American Standard, 5 Warning Signs You Need to Replace Your Furnace
• EPA, Carbon Monoxide's Impact on Indoor Air Quality
• HomeAdvisor, How Much Does a Furnace Replacement Cost?
• This Old House, How Much Does a Furnace Cost?
• CBS News, What is the $5,000 rule for HVAC systems?
• IRS, Energy Efficient Home Improvement Credit
• CPSC, Carbon Monoxide