How Much Does HVAC Installation Cost in Ontario? (2026)
HVAC installation cost in Ontario depends on the system
The cost of HVAC installation in Ontario in 2026 runs from $3,500 for a basic furnace to $14,000 or more for a full furnace and AC replacement. Heat pumps push that ceiling to $20,000 on high-end cold-climate units.
Most homeowners doing a complete replacement spend $8,000 to $14,000 for a furnace and AC combo. Contractors quoting these jobs need to know where the GTA market sits, both to win bids and to avoid leaving margin on the table.
This post breaks down the 2026 prices for furnaces, central AC, heat pumps, and combined systems in Ontario, plus the rebates that change the conversation with homeowners.
Furnace replacement cost in Ontario (2026)
Furnaces are the most common HVAC replacement in the province because of cold winters and aging gas infrastructure across older GTA neighbourhoods.
| Home size | Standard furnace cost (installed) |
|---|---|
| Under 1,500 sq ft | $3,400 to $5,000 |
| 1,500 to 2,500 sq ft | $4,000 to $6,500 |
| 2,500 to 3,500 sq ft | $5,000 to $8,000 |
| Over 3,500 sq ft | $7,500 to $10,000+ |
For a 2,000 sq ft home, a standard 96 percent AFUE gas furnace runs $3,000 to $7,000 installed. High-efficiency models push that to $10,000.
In Toronto specifically, complete furnace replacement (equipment, install, permits, removal of the old unit) typically lands between $3,500 and $6,500.
The labour portion is usually $500 to $1,000 of the total quote. Complex installs (tight access, asbestos abatement around old ductwork, gas line rerouting) can push labour past $2,500.
Central AC installation cost in Ontario (2026)
Central air conditioner installation in Ontario costs $3,500 to $7,500 in 2026. Toronto and the broader GTA run slightly higher at $3,800 to $7,500.
For an average-sized GTA home, a mid-efficiency 2.5-ton AC system installs for $3,200 to $5,500. High-efficiency systems or larger units push past $7,000, especially when ductwork modifications come with the job.
Replacing an existing AC is meaningfully cheaper than a first-time install because the line set, ductwork, and electrical are already in place. First-time installs in older homes that never had central AC can cost $2,000 to $4,000 more than a straight replacement.
Heat pump installation cost in Ontario (2026)
Heat pumps are the fastest-growing HVAC category in Ontario, driven by federal and provincial rebates plus carbon-tax economics on natural gas.
- Ducted air-source heat pump: $6,700 to $12,000, average around $8,500
- Cold-climate heat pump (high-end): $12,000 to $20,000
- Ductless mini-split: $4,000 to $8,000 per zone
Homeowners replacing both their furnace and AC can use a heat pump combo to effectively replace both systems for $10,000 to $15,000 before rebates. After rebates, the net cost can drop below the cost of a furnace+AC combo.
Combined furnace and AC replacement
Most homeowners get a furnace and AC quote together because the install crew, electrical, and ductwork only need to come once.
Typical combined Ontario pricing in 2026:
- Standard furnace + standard AC: $8,000 to $11,000
- High-efficiency furnace + AC: $10,000 to $14,000
- Full HVAC system replacement (premium tier): $14,000 to $18,000
Bundling almost always saves the homeowner $1,500 to $3,000 vs replacing them in separate visits, and it saves the contractor a second mobilization.
Five factors that change the quote
1. Efficiency rating
A 96 percent AFUE furnace costs $1,500 to $3,000 more than an 80 percent unit but qualifies for rebates and saves $200 to $400 a year in gas bills. The economics favour high-efficiency for most Ontario homeowners.
2. Brand
Carrier, Lennox, Trane, and Goodman sit at different price points. A Lennox premium unit can cost $1,500 more than a Goodman entry-level for similar capacity. Some contractors carry one preferred brand to control parts and warranty.
3. Ductwork condition
If existing ducts are undersized, leaking, or missing returns, expect $1,000 to $4,000 in additional work. Older Toronto and Hamilton homes often need return air upgrades that homeowners are not expecting in the quote.
4. Electrical and gas line work
Heat pumps may require a 200 amp panel upgrade, which runs $1,500 to $3,500. Gas line extensions for furnaces add $500 to $1,500. Always inspect the panel before quoting a heat pump.
5. Permits and inspections
Most Ontario municipalities require gas, electrical, and ESA permits. Combined these run $200 to $600 and most contractors include them in the total quote rather than itemizing.
Available rebates in 2026
The rebate landscape changed the math on heat pumps and high-efficiency systems:
- Up to $6,500 for qualifying heat pump and high-efficiency furnace combos through provincial programs
- Up to $10,000 in stackable heat pump rebates depending on home eligibility
- Toronto Home Energy Loan Program offers up to $125,000 in low-interest financing for energy upgrades
Rebates are usually claimed by the homeowner, with the contractor providing the equipment specs and proof of install. Contractors who guide homeowners through the paperwork win more bids than contractors who just hand off a brochure.
What this means for HVAC contractors
If you are quoting HVAC in Ontario, the 2026 ranges in this post are the GTA market. Quoting consistently below these numbers usually means margin is leaking somewhere (labour burden, overhead allocation, or warranty reserve).
Smart quoting in 2026 means presenting three tiers: the budget option (good, for price-shoppers), the recommended option (better, best value for their home), and the premium option (best, highest efficiency plus rebates). Most homeowners pick the middle.
Related reading: How to Quote an HVAC Job in Ontario and Contractor Markup and Profit Guide Ontario.
For current rebate rules see the Canada Greener Homes Initiative.
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