Furnace Cost in Michigan: 2026 Guide

What’s the Average Furnace Replacement Cost in MI?

In Michigan, furnace replacements usually run $5,800 to $10,200 installed, depending on system size, your desired furnace efficiency, and how straightforward or difficult your installation is.

Below, you can find state-specific rates, incentives, climate notes, and city guide links that can help you ballpark your project cost. You can also use Modernize’s HVAC cost calculator.

Installed Furnace Cost in Michigan – Table

These costs were calculated specifically for Michigan (you can read more about how we do that in the Methodology section at the end of this page), and they include equipment, removal of the old furnace, install, minor ductwork repairs, and permits.

Furnace Type	Typical Size (BTU)	AFUE	Equipment Cost	Install Cost	Total Installed Cost
Single-Stage Gas	70–100k	80–95%	$2,100–$3,200	$2,700–$4,000	$5,800–$7,200
Two-Stage Gas	80–110k	92–96%	$2,900–$3,900	$3,200–$4,600	$6,500–$8,500
Modulating / VS	100–120k	95–98%	$3,600–$5,000	$3,800–$5,800	$7,800–$10,200

Methodology: Based on ~210 installs/leads in Michigan + national MSRP bands, adjusted for MI labor. Last updated Nov 2025.

Understanding Terms and Abbreviations in the Table Above

• For the “Furnace Type” column, you’ll see we have covered single-stage, two-stage, and modulating/variable speed (VS). A single-stage furnace can be either on or off while the other furnaces have advanced technology allowing them to modulate how much warm air is coming into your home to keep temperatures consistent and to reduce overall energy consumption. Modernize has a blog post covering how two-stage furnaces work if you want to learn more.
• The “Typical Size” column shows furnace BTUs. BTUs are a measure of how much heating output a furnace can deliver each hour. Homes with more square footage or drafty construction need higher BTU capacity. We cover this in more detail in the next section.
• AFUE stands for Annual Fuel Utilization Efficiency; the closer it is to 100%, the less energy you waste. You can read Modernize’s blog post about understanding AFUE ratings if you’d like more information.

Furnace Sizing in Michigan Homes

Most Michigan homes require furnaces between 70,000 and 110,000 BTU, depending on home size, insulation, and regional climate.

• Lower Michigan (Detroit, Ann Arbor, Grand Rapids, Lansing): Homes between 1,500–2,200 sq. ft. usually need 70k–90k BTU systems.
• Northern Michigan / Upper Peninsula: Cold climates and longer heating seasons often call for 90k–110k BTU models.

The wrong furnace size can impact your home’s comfort level and your bills. If you get a furnace that’s too big, it will short-cycle and waste energy. Undersized systems struggle to keep up during peak cold and have to run more hours a day. You can use Modernize’s furnace size calculator to get a ballpark estimate of what size furnace you’ll need, and you can also read our article all about determining furnace size for homes in Michigan.

How Much Does It Cost to Run a Furnace in Michigan?

• At $1.15/therm, heating with a 95% AFUE gas furnace costs roughly $1,300–$2,200 per heating season for a 2,000 sq. ft. home.
• At 16.0¢/kWh, heating with an electric furnace costs roughly $5,000–$8,400 per heating season for a 2,000 sq. ft. home.

Furnace Rebates and Incentives in Michigan

• Consumers Energy heating and cooling rebates can save you up to $100–$300 for high-efficiency furnaces. They even offer tune-up rebates.
• DTE Energy furnace rebates range from $100–$400 for high efficiency furnaces.
• Federal 25C credit offers up to $600 for HVAC upgrades. This tax credit will expire on December 31^st, 2025.

You Need a Permit to Install or Replace a Furnace in Michigan

Michigan follows the 2015 Michigan Residential Code (based on IECC 2015). Permit requirements vary by county/city. Below, we’ve included links to the permit form you need for Detroit, Grand Rapids, Ann Arbor, and Lansing.

Ready to dive into city by specifics? Below, we cover four major Michigan metros. their average furnace replacement costs, and what impacts that cost.

Detroit Furnace Cost

Older homes and dense urban neighborhoods make Detroit installations slightly more complex, especially where venting and code updates are needed. Most furnace replacements in Detroit cost between $5,900 and $10,300 installed.

Package	What’s Included	Typical Total
80k BTU, 95% AFUE, single-stage	Standard swap, permit + inspection	$5,900–$7,400
100k BTU, 97% AFUE, variable-speed	New venting, condensate, permit	$8,200–$10,300

• Permitting: You will need a mechanical permit for a furnace replacement in Detroit. Costs range from about $60 to $180.
• Rebates: As we noted above, DTE Energy furnace rebates go as high as $400.
• Average Labor Cost: $90–$125/hr. In Detroit, labor cost to install a furnace will make up $2,700 to $4,200 of total project

Grand Rapids Furnace Cost

Homes in Grand Rapids often have mixed venting setups and moderate winter fuel loads. Furnace installs here range from $5,800 to $10,100 installed, depending on furnace efficiency and labor.

Package	What’s Included	Typical Total
80k BTU, 95% AFUE, single-stage	Standard swap, permit + inspection	$5,800–$7,300
100k BTU, 97% AFUE, variable-speed	New venting, condensate, permit	$8,000–$10,100

• Permitting: You will apply for Grand Rapids’ residential mechanical permit for furnace replacement.
• Rebates: Consumers Energy heating and cooling rebates go as high as $300.
• Average Labor Cost: $85–$120/hr. In Grand Rapids, the labor cost for a furnace install will make up about $2,600 to $4,000 of the total project cost.

Ann Arbor Furnace Cost

Ann Arbor’s mix of older housing and energy-conscious homeowners drives strong interest in high-efficiency systems. Most replacements cost between $5,900 to $10,200 installed.

Package	What’s Included	Typical Total
80k BTU, 95% AFUE, single-stage	Standard swap, permit + inspection	$5,900–$7,400
100k BTU, 97% AFUE, variable-speed	New venting, condensate, permit	$8,100–$10,200

• Permitting: Ann Arbor’s trade permit for a furnace replacement can be found through their self-serve STREAM portal.
• Rebates: You may qualify for a furnace rebate from DTE Energy, which range from $100 to $400 depending on the efficiency of the furnace you choose.
• Average Labor Cost: $90–$125/hr. In Ann Arbor, labor can make up about $2,700 to $4,100 of your total project cost depending on how difficult your furnace is to install.

Lansing Furnace Cost

With a large number of mid-century homes and varying duct conditions, Lansing furnace replacements generally cost between $5,700 to $10,000 installed.

Package	What’s Included	Typical Total
80k BTU, 95% AFUE, single-stage	Standard swap, permit + inspection	$5,700–$7,200
100k BTU, 97% AFUE, variable-speed	New venting, condensate, permit	$7,900–$10,000

• Permitting: You will need to file Lansing’s mechanical permit form for a furnace replacement.
• Rebates: Consumers Energy furnace rebates range from $100 to $300 based on how efficient your new furnace is.
• Average Labor Cost: $85–$120/hr. For a Lansing furnace replacement, you can expect about $2,500 to $3,900 of your total project cost to be attributed to labor.

Ready to Find a Contractor?

If you plan to take advantage of any rebates, you should check on your energy provider’s website to see if they require an approved contractor. If so, you should be able to browse the database of approved contractors for your area.

Modernize can also help you find a contractor. Click below to answer a few questions about your project and be matched with up to four contractors in your area. We always recommend getting at least three quotes if possible to find the best price for your project.

Methodology & Sources

Data compiled from 210+ Michigan installations, verified contractor quotes, RS Means labor indices, municipal permit fee schedules, and utility rebate data. Utility rates from EIA; climate metrics from NOAA/NCEI. Prices reflect standard residential replacements excluding major duct redesigns or electrical service upgrades. Updated quarterly.