The Price of Comfort: Average AC Replacement Costs Explained

Did you know that roughly 90% of United States households use their air conditioning annually? For most people, using the AC is a routine, normal part of their day. If yours has broken, how do you replace the AC unit without breaking the bank?

If you’re curious about the average AC replacement cost and how to reduce the amount, we’re happy to help. Read on to learn about the average AC unit cost and how much you’ll need to replace it. We’ll also discuss some factors in the cost and how you can save money on your AC installation.

General Ballpark

To start, it’s difficult to give an exact amount on the average AC replacement cost. Primarily, this is because there are so many factors that affect the price. We’ll dissect a few of those factors, but it’s possible to estimate a general range.

The average cost of an AC replacement is between $4,000 and $13,000. Clearly, there’s a massive margin between these two numbers, so how can we narrow it down?

What Affects the Average AC Replacement Cost?

When it comes to narrowing down your cost, you’ll need to look at the factors in the cost. For example, did you know there are permit fees for installing an air conditioning system?

AC units can pull on the local power supply. An unrated or unauthorized AC unit can pull too much and harm your power grid. Such an issue isn’t just inconvenient for you and your power bill, as it can endanger or trouble your neighbors as well.

Aside from permit fees, labor is also a considerable factor. Air conditioning units are complex and difficult to install. It’s rarely as simple as putting the AC unit down and plugging the system in.

Instead, you’ll need professional help installing the AC unit. Labor and permits are the most predictable costs, as you can look these up with local companies and government bodies. Other factors include:

  • The system’s efficiency
  • Any tax credits or rebates
  • The cost of the equipment you’ll keep instead of replacing
  • Capacity and power of the new system
  • Any modifications to your existing equipment
  • Line set protection

While these factors are the most notable, there are other hidden fees and bonuses. For example, it may cost more in your area to install an AC system. Perform adequate research on the labor, permits, and system to gain an accurate estimate of your system’s cost.

Reducing the Cost of Your AC Installation

You may notice that not all of these points are factors that increase the cost. There are several ways that you can lower the price of your installation. Read on to learn more about reducing the average AC replacement cost.

Proper Sizing

One of the first factors in reducing the cost of your air conditioning comes from reducing your bill. Did you know that AC units come in different capacities?

Air conditioning units are not made equally. The same system that keeps a studio apartment cold will likely be inadequate for a three-bedroom household.

Some homeowners opt for a cheaper air conditioning unit to cut costs. Doing so can make the AC installation cost less and reduce your average cost to replace the AC. Ultimately, you’ll find that this method costs more in the long run.

Due to being too small, the air conditioning unit won’t cool the home appropriately. As such, it will run indefinitely until it eventually wears itself out. When this occurs, you’re back where you started with a broken AC unit and several thousand dollars missing.

The same is true for an air conditioning unit that’s too large. You won’t need an enormous industrial AC unit for a cozy townhome. The installation will be costly, the system astronomically expensive by comparison, and your home over-conditioned.

Matching Equipment

A great way to save on the cost to install an AC unit is to have matching equipment. Many homes use furnaces to keep the home warm during the cold months.

When purchasing your AC unit, you need to match it with your furnace. If the furnace isn’t compatible with the AC unit, you may run into issues down the line.

For the most part, this is the case for variable-speed AC units. Additionally, many homes don’t have furnaces, making this something you’ll rarely need to consider.

You also may feel inclined to replace both at once. While this is often a good plan, it’s not always necessary and can increase the cost upfront. Consider replacing the less “important” half of your HVAC system down the line.

Types of Air Conditioners

When you think of AC installation, you may not know there are multiple types of air conditioners. While they all function similarly, the different types of AC units will affect the cost, function, and efficiency of your system. Here are the primary types of AC units.


Single-stage AC units are the simplest and often the cheapest. These systems usually have one setting to manage: on, or off.

When on, a single-stage AC will function at 100% capacity. While you’ll have less control, you’ll save money and hassle.


Two-stage AC units are just as simple but provide better control. With these units, you have the 100% capacity setting and another that’s typically about 2/3rds capacity. These systems are more expensive than single-stage systems, but still relatively cheap.


Finally, variable-speed AC units are the most expensive and complicated. However, they give you full control over the AC and allow you to dictate the temperature of your home.

Variable-speed AC units must match with your furnace. Speak with a professional to ensure you’re using the right system.

Finding the Right AC Unit

The average AC replacement cost varies based on the unit, location, and how much is being replaced. Expect labor, permits, and the cost of the system to be the primary expenses during your replacement. Seek professional help to install the AC unit or replace the AC unit that no longer functions.

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