Replacing your AC Unit? What are the Costs?



Once you decide that replacing your air conditioner is a better option than having it repaired, your next step is determining how much it will cost. While you have some flexibility in the amount you’re willing to spend, some factors, like the size unit that’s right for your home or the local heating, ventilation and air conditioning (HVAC) installation costs, are at least partially out of your control.

Whatever your budget, it’s best to estimate your project with a few local installers. They can size your system correctly for your home for more accurate pricing. It’s also helpful to arm yourself with some general air conditioner replacement costs so you know what to expect when you reach out to an HVAC professional.

What Impacts the Cost to Replace Your Air Conditioner?

How much it costs to replace an air conditioner depends on many factors, making it challenging to identify a reliable price range for your unique needs. Everything from the size you need to your home’s installation conditions will play a role. Some of your cost considerations include:


A bigger air conditioning unit will cost more than a smaller one, and vice versa. The tonnage you need depends on how big your home is, your insulation and a few other factors. Since you’re replacing an existing unit, you probably already know what size air conditioner you need. The label on your current unit should tell you its tonnage and cooling capacity. You can also look up your model number online to determine how large your replacement unit needs to be. 

Unless you’ve added some major additions to your home since installing your existing air conditioner, you can expect the cooling capacity to stay roughly the same. Going much smaller will not cool your house effectively, and going larger may cool it too quickly, which can cause humidity concerns. In terms of how size affects cost, a 2.5-ton unit might cost roughly double the price of a 0.5-ton unit.

If you’re unsure what size unit you need, you can visit our detailed guide on sizing your air conditioner for more information. 


AC unit costs can vary in price quite a bit by brand name. Some manufacturers position themselves as value and cost leaders, while others gravitate towards high-end brands and prices. A premium brand might charge twice as much for a unit of the same size as a cost-leading brand. 

Here at MRCOOL, we’re known for our excellent efficiency-to-cost ratio. When you install a MRCOOL air conditioning unit, you get a high-quality, well-performing product at a great value. You’ll save on the product itself compared to some other brands and continue to shave costs on your electricity bill. 


Energy-efficient air conditioners provide impressive long-term cost savings over less-efficient models. However, as with most manufacturing, the more sophisticated technology that makes a unit more efficient comes at a higher initial price point. You can quickly compare units’ energy performance by their Seasonal Energy Efficiency Ratios (SEER). A higher SEER means a more efficient system. Likewise, a higher SEER also makes for a higher upfront cost. 

When determining if a more efficient model is worth the long-term savings, the right call depends on your local climate and how many hours you run your air conditioner. The payback period is shorter for homeowners who use their air conditioner more often in hotter climates.

The good news is that replacing an older air conditioning unit almost always provides efficiency gains. Even replacing a unit that’s only 10 years old can save you 20%-40% on your cooling costs. Many MRCOOL models are Energy Star-certified, which means identifying an efficient model that’s right for your home and budget is easy.

The Model

Most air conditioner brands offer many different types of units at varying price points. An advanced model with lots of extra features will cost more than a basic model. The specific model can also determine installation costs, as a ductless model can require less labor and equipment than a central air conditioning system.

A packaged air conditioner, which combines heating and cooling, typically costs less than installing split systems. However, if you already have a furnace for heating, it will probably be more affordable to install a split-system air conditioner.

Cost of Labor

Labor costs can vary a lot by where you live and the HVAC installer you work with. The local labor market has an unavoidable effect on the cost of installing replacing your air conditioner. And just like with the brand of the air conditioner itself, different installers may charge different rates. Some may offer premium service at a higher price. 

To give you an idea of the labor cost differences, consider that an HVAC installer’s hourly wage can span anywhere from $15.34 per hour to $38.86 per hour, according to the United States Bureau of Labor Statistics. While it’s critical to note that the price you pay for labor will differ from wages, these figures give you a good idea of how much the labor costs can vary.

Be careful of any installers who seem to be undercharging significantly for installation, as you want a quality installation that is energy-efficient and will last for years to come. We recommend you look for a MRCOOL dealer near you to ensure your installation is done right and respects your warranty. If you’re looking to save on labor and you’re feeling handy, you might consider a MRCOOL DIY® Multi-Zone unit to cut out labor and installation costs entirely.

Home’s Age

If you have an older home, you might not have the existing ductwork to handle central air conditioning. Installing brand new ductwork or repairing some aging ducts can quickly add to the total cost of your air conditioner replacement. An alternative for an older home without the proper ductwork for central air is a ductless air conditioner. We offer a range of ductless mini-split models for DIY and professional installation, including the MRCOOL Olympus Multi-Zone, which can cover up to five zones in your home without any ducts. 

What Are the Costs of Replacing a Central Air Unit?

Central air replacement costs can vary based on your system configuration, installation requirements and unit size. A central air conditioning system circulates cool, dry air throughout your home through ducts. As the cool air enters each room through metal vents in your floors, ceilings or walls, other vents collect warm air to be conditioned and recirculated. Central air conditioners are energy-efficient compared to window and portable air conditioners, are relatively quiet and can share ductwork with your heating system. They come in two main types — split systems and packaged units.

In a split system, the condenser and compressor are outdoors, while the evaporator is indoors. They are more energy-efficient than packaged units. Packaged air conditioners keep all three of these air handling components outdoors, making them cheaper to install and more space-efficient. Central air conditioners cool homes more effectively than other systems, usually for a higher upfront cost. 

Central air conditioners also have one of the broadest pricing spreads since installation costs depend on whether the home has the proper ductwork. However, if you’re replacing an existing central air unit, you probably do not need all-new ductwork. It’s helpful to have an HVAC specialist look at your existing ductwork to determine if anything needs work. Otherwise, you can focus on the cost of the new central air unit itself. Central air conditioner replacement can cost anywhere in the low-to-mid thousands range, including the unit and installation.

Another factor here is the type of unit you want. Some central systems include heating, which adds to the cost. If your current air conditioner doubles as a heater, you’ll want a replacement that does the same. If you have a separate furnace, you can save some money by choosing a system that does not offer heat.

What Are the Costs of Replacing an Air Unit With a Ductless Mini-Split?

Replacing your current air conditioning system with a ductless mini-split system can be an affordable option since you automatically eliminate any ductwork repair. However, ductless mini-splits typically cost more than central air units. The reason for this is that ductless mini-splits are incredibly energy-efficient and remove the hassles involved with ductwork. You may pay more for the system itself while saving on installation costs immediately and ductwork maintenance and energy costs down the road.

The most significant cost factor in a ductless mini-split is how many units you need. While many think of a single-room unit, multi-zone systems can cover up to five zones. Of course, each zone you add will affect the cost since it requires an additional unit. While a single-zone model can cost somewhere in the low-to-mid thousands range, multiple units can climb into the high thousands, including installation costs.

Other price differentiators are the individual model and the array of features you want. For example, a mini-split system that also provides heat will cost more than a cooling-only model. At MRCOOL, we offer a few different mini-splits at a range of prices. For example, our MRCOOL Advantage system prioritizes affordability and efficiency. The MRCOOL Olympus series includes units that offer advanced functionality, like the Olympus E Star® system offering superior energy efficiency and the Olympus Hyper Heat, which can heat your home incredibly efficiently.

To save money on a ductless mini-split system, you can also choose a DIY model for either a single room or multiple zones. MRCOOL offers the only true DIY ductless mini-split, allowing you to save significantly on installation costs. 

What Are the Costs of Replacing Your Air Unit With a Heat Pump?

A heat pump is a unit that can pump heat out of your home to cool it and into your home to warm it. When used to cool your home, its functionality is almost identical to an air conditioner. The MRCOOL GeoCool® Geothermal Package Heat Pump offers some incredible cost advantages with energy efficiency of up to 36.5 SEER and operational costs reduced to 50% that of a conventional system. Geothermal heat pumps last for decades with little maintenance, which can also make them well worth the investment.

Replacing a traditional air conditioner with a geothermal unit can vary in price with several factors. An important costing consideration is in the sizing. It’s critical to install a heat pump with the correct capacity for your home’s size to get the longest lifespan. As with other types of air conditioners, a heat pump’s size affects its cost. Their level of efficiency also affects the pricing, with more efficient models requiring higher upfront investments. 

Note that geothermal systems also require permitting alongside the unit and labor costs. Heat pumps also require ductwork like a traditional air conditioner, which may add to your replacement costs if you need any additional ductwork. They vary quite a bit in cost, starting in the mid-thousands and climbing as high as $12,000-$30,000, depending on many factors.

What Should You Know Before You Replace Your Unit?

Many factors can go into choosing to replace your air conditioner besides cost. If you still haven’t decided whether to replace or repair your existing unit, it’s important to keep a few things in mind. Some things to note about your current air conditioner before replacing it include its:

  • Age: A typical air conditioner can last 12-15 years or more. Energy Star recommends replacing any unit over 10 years old because of the cost savings resulting from better energy efficiency. Any unit under 10 years old may be a better candidate for repair. 
  • Repair costs: If this is the first time your air conditioner has given you any problems, it’s prudent to look at repair estimates first. An HVAC professional can give you an idea of whether a routine repair or a full replacement is a better option. If repair costs are low, consider fixing it rather than replacing it. However, as a unit ages, repairs become more frequent and costly, making replacement more cost-effective.
  • Energy efficiency: It may be worth your money to replace a well-functioning air conditioner for the long-term energy savings. If your current unit is energy-efficient as is, you may be better off with a repair.
  • Performance: When an air conditioner cannot cool your home to your satisfaction or adequately remove humidity, it may have larger-scale performance issues than a repair could address. These types of concerns are a sign that the unit is under- or oversized, which you can address by replacing your unit with the help of an HVAC professional to estimate your required capacity.

Can You Lower the Cost of an AC Unit Replacement?

When you’re comparing costs for air conditioner replacements, you’re usually interested in getting the best price possible without sacrificing performance. Using a DIY ductless system is one way to gain that advantage by eliminating installation costs. If you’re looking for a professional installation, you still have many options to bring down your AC replacement cost. Our best cost-saving tips include:

  • Look for rebates and tax credits: Your local government or utility provider may offer financial incentives for installing an energy-efficient air conditioner, potentially saving you hundreds. Visit the MRCOOL rebate finder tool to look for rebates from your local electricity provider and federal and local tax credits.
  • Install outside of peak heating and cooling season: HVAC specialists are busier during the hottest and coldest months. You can often save money and get the job done faster by scheduling your replacement for fall or spring.
  • Consider your cooling needs: A ductless mini-split system offers enhanced energy efficiency over central air. If you only need cooling for one or several rooms of your home, you can save a lot in the long run by choosing a ductless system over central air. Empty nesters and those who are only home at night save a lot of money by only cooling key areas of their homes.

Contact Skyway Minisplit Sales Today 

MRCOOL has a wide range of air conditioning systems that can fit any homeowner’s unique cooling needs and budget. From DIY ductless mini-split systems to save on installation to high-efficiency systems that will save on long-term cooling costs, we have something for everyone. We also offer an innovative MRCOOL Universal® Series system that can easily replace any conventional central air condenser for a quick installation and superior performance.

If you’re interested in a high-quality, better value air conditioning system from MRCOOL, look for a nearby reseller or installer to help you with all your air conditioning replacement needs.

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