Furnace Replacement Cost in Ontario

A furnace replacement for an average Ontario home (roughly 1,500 to 2,000 square feet) typically costs $4,500 to $8,000 installed, including the unit, labour, permits, disposal of the old furnace, and gas line reconnection.

Price varies mainly by efficiency tier:

A standard single-stage furnace runs $3,500 to $5,000. A two-stage mid-efficiency furnace — quieter, and better at matching output to what your home actually needs — runs $4,500 to $7,000. A high-efficiency furnace runs $6,000 to $10,000, but typically qualifies for the largest rebates and the lowest ongoing gas bills.

Rebates can meaningfully offset the upfront cost

Enbridge and federal programs have offered rebates up to $6,500 on qualifying high-efficiency installs — a supplier who installs furnaces regularly should know what's currently available and whether your specific unit qualifies, since rebate programs and amounts do change.

Sizing matters more than most homeowners expect

A furnace that's too big for your home cycles on and off more than it should, which is harder on the equipment and doesn't actually heat more evenly. A furnace that's too small runs constantly during cold snaps and still struggles to keep up. A proper installer sizes to your home's actual square footage and insulation, not just "replace what was there." If your old furnace was original to the house and you've since added insulation or replaced windows, it's worth asking whether the replacement should be sized differently too.