Find a top agent in your area

Get started

How Much Value Does Central Air Add to Your Home?

At HomeLight, our vision is a world where every real estate transaction is simple, certain, and satisfying. Therefore, we promote strict editorial integrity in each of our posts.

If you’re still using window units or fans to keep your home comfortable, you might feel left out in the cold. While at least 90% of homes nationwide use some type of air-conditioning, government statistics show that 66% of them use central air. Researchers predict this market will grow more than 5% by 2026, thanks to higher temperatures and humidity worldwide and the changing view of AC as a utility rather than a luxury.

With these different factors in the mix, you might wonder if it’s time for an icy upgrade. How much does installing central air cost — and how much value does central air add to your home at resale?

While some analysts previously found that homes with air-conditioning sold for 2.5% more nationwide than homes without it, more recent assessments consider replacing the HVAC an “invisible improvement,” something that many buyers just assume is in good working order and for which they’ll rarely pay extra. That said, if it involves smart technology or energy efficiency, buyers could consider this a perk.

Overall, premiums vary by location, and where you live also plays a huge role in whether buyers expect it.

“Does it add value? Yes. If they don’t have it, and a client asks if they should put it in prior to listing the house, I unequivocally 100% say no. Don’t waste the money,” says Michael Whitney, a top-selling real estate agent serving Portsmouth and Rockingham County, New Hampshire, who works with over 79% more single-family homes than the average area agent.

“It adds to the salability more than it adds to the value,” adds Bob Sophiea, a top-selling agent in the Lexington, Kentucky, area who is also a historic home and luxury home specialist.

Here’s how to help evaluate whether installing central air-conditioning boosts your “cool factor” enough at resale to warrant the expense.

Partner With a Top Local Agent Who Knows What Buyers Want

If you’re selling a house without central air, consulting with a top agent who knows what buyers want in your market can help ensure that the improvements you make are worth the investment.

Most of the Southeast and newer homes keep it cool

Worldwide, China loves air-conditioning more than anyplace else. Out of 107 million AC units demanded around the globe in 2022, China took 40 million. By comparison, all of North America snagged just 15 million.

In the United States, air conditioners use about 6% of all the electricity produced, at an annual cost to homeowners of about $29 billion, the U.S. Department of Energy says.

That usage isn’t equal across the board. Of roughly 124 million housing units nationwide that use air-conditioning, about 37% are in the South compared to about 22% in the Western states, 21% in the Midwest, and 17% in the Northeast, the U.S. Energy Information Association (EIA) notes. If you live in a home less than 50 years old, you’re likely to have central air. About 42% of the homes built in the 1990s through the 2000s use central AC, according to the 2020 Residential Energy Consumption Survey, released in May 2022.

Central AC is more common in households where the income is greater than $100,000. About 34% have it, this survey shows. But even among low-income households (those earning below $40,000), roughly 28% have central air.

Two identical houses: One with central AC, one without. Which one is worth more?

Although one appraisal estimate in Pocket Sense says that installing a new central air-conditioning system will increase your property value by 10%, our agents modify this a bit. While they would price a home with central AC higher than one without, the pricing depends on other market conditions.

For instance, Sophiea recently purchased a cabin that does not have central AC along Lake Cumberland, but it has ductwork for air-conditioning, thanks to the sellers installing a heating system.

“There are places that don’t have air-conditioning, but I think it’s more of a prerequisite.” He plans to spend about $5,000 to install AC at the cabin, which he equates to a $10,000 upgrade. “When you don’t have a system, you’re looking more for an investor who’s going to add it in, and you’re going to take a discount.”

If a 1,000-square-foot cabin sells for about $100,000 with central air, Sophiea says he’d list a similar-size cabin without AC for about $10,000 less because of the desirability.

By comparison, while multimillion-dollar homes in New Castle, New Hampshire, are expected to have central air, Whitney estimates that 60% of the new construction under $500,000 in New Hampshire and Maine doesn’t have it. He wouldn’t factor in a certain asking price for a home with central air-conditioning without considering other features.

“You don’t know what the buyer wants,” he says. “If I’m a listing agent and you come through and say, ‘My buyer is not going to buy this because it doesn’t have central air,’ I’ll say, ‘Give me a contract, and tell me you want it. We’ll put [the AC] in. … Let’s agree on the price.’”

How much will installing central air cost you?

The average cost nationwide to install central air-conditioning is about $7,000, according to the renovation price guides on Fixr.com and HomeAdvisor.com. However, pricing varies by home size, the system’s energy efficiency, and your climate, among other factors. For example, you could pay from $5,000 to $12,000 to install central AC in a 2,000-square-foot home that has existing air ducts that are more than 15 years old.

Ductwork can be a challenge, depending on the age of your home and the architecture, Sophiea says. The average cost of installing or replacing ductwork alone costs about $1,138, or about $10 to $20 per linear foot. Without ductwork, installing a new central air system can range from $3,800 to $7,500.

Nejad Eqal, owner of Service Express HVAC in Lexington, Kentucky, which holds a Google Review rating of 4.8 out of 5 stars, says a home’s size and age have a significant impact on costs.

“People call all the time: ‘I’m looking at this house, and it needs air-conditioning. I need to know what it’s going to cost’,” says Eqal, who works with Sophiea. “The larger the home, the larger the air conditioner you need, or making it one or two systems.” Older homes that have little or no insulation either need insulation or a more powerful unit.

An installer also needs to know where to place the central cooling unit, such as outside the house, in an attic, or in a crawlspace, Eqal says. An HVAC unit can be mounted on the roof of homes with limited ground space, but the installation labor costs up to $1,000 because of the difficulty.

How to maximize your central AC upgrade

To estimate your possible installation cost, you’ll need to decide on the system type, capacity, energy efficiency, and brand. Here’s an overview of these factors.

Types of AC systems

  • Split system: If your home uses a furnace and ducts, this is an economical way to add air-conditioning. It has a condensing unit that installs outside and an evaporator and fan that sit atop the furnace.
  • Heat pump: This all-in-one heating and AC unit works well in climates with moderate winters. It transfers heat through ducts from the inside of your home to the outdoors in the summer and vice versa in the winter.
  • Ductless mini split system: If your home doesn’t have ductwork or has plaster walls or original woodwork where you don’t want to install ducts, this is a good possibility. It also works well for open floor plans. A ductless mini split system cools the air using an outdoor compressor and an indoor air handler connected via tubes. You can select more than one for different areas of the house, especially if you want to set different temperature zones. Most houses have four to eight air handlers.
  • HVAC packaged system: For homes that do not already have a furnace or need to replace the furnace, this incorporates all the needed components into one outdoor unit.
  • High-velocity HVAC system: Similar in function to an HVAC packaged system, a high-velocity HVAC circulates air through ductwork that’s about 2 inches in diameter, making it a good option for tight spaces and older or historic homes. Because these systems run faster than others, they are noisier, however.

Capacity

Air-conditioning units measure their cooling capacity in tons. One ton is the amount of energy required to melt one ton of ice over 24 hours. (The term is left over from the days when ice was essential to refrigeration.) You might be more familiar with BTUs, or British Thermal Units, which in AC relates to the cooling output. A one-ton air-conditioner might release 12,000 BTU per hour.

In general, you need about 20 to 60 BTUs per square foot of cooling, but this again varies by climate. A professional installer can help you calculate what capacity your home will need and which systems can best handle this.

Energy efficiency

Air-conditioning systems also have efficiency measures that calculate how many watts the system uses. Residential systems carry a SEER, or Seasonal Energy Efficiency Ratio, specific to particular climates. SEER ranges from 13 to 24; the higher the rating, the lower the energy costs, but you’ll pay more for the initial system purchase. A 16 SEER system might cost more than one with a lower SEER, but it could reduce your annual cooling costs because it’s more efficient. Many older AC systems have an 8 or 9 SEER rating, so even a 13 SEER system will be more energy-efficient, according to Trane, a leading HVAC manufacturer. Talk with a professional installer about any incentives such as rebates or tax credits at the state or federal level.

Also, don’t forget to ask about a high-efficiency filter, which reduces pollen and dust within your home and keeps the air-conditioning equipment clean. Simply replacing a clogged, dirty filter can lower your air conditioner’s energy consumption by 5% to 15%, the U.S. Department of Energy says.

Experts recommend a filter with a minimum efficiency reporting value, or MERV, rating of 13 for residential HVAC systems, but ask an installer if your system can handle that. (The higher the MERV rating, the lower the airflow, so some older systems will work harder.) If not, go with the next lowest rating.

Brand

Brands of air-conditioners also vary in price depending on quality, features, and longevity. Eqal likes Rheem, which Fixr.com says costs about $2,000 to $3,000 for a three-ton unit. “We sell a lot of them. For the quality, the price is wonderful.”

Modernize, a privately owned lead-generation company since 2005 that connects homeowners with contractors, compared units with 14 to 16 SEER ratings and recommends the following for 2022 based on price, energy efficiency, warranty, and customer service:

  • American Standard (about $3,600 to $6,200)
  • Carrier (about $4,900 to $7,200)
  • Goodman (about $3,200 to $4,300)
  • Trane (about $3,300 to $6,100)
  • Rheem (about $3,200 to $4,000)
  • Lennox (about $3,100 to $7,300)
  • York (about $3,100 to $5,200)
  • Ruud (about $3,100 to $3,900)
  • Amana (about $3,900 to $6,300)
  • HEIL (about $3,600 to $4,500)
  • Bryant (about $3,300 to $5,400)

Energy Star also compiled a list of its most energy-efficient central air-conditioners and heat pumps for 2022, which includes various ratings by capacity, energy use, and lifetime cost to operate.

How Much Is Your Home Worth Now?

Get a near-instant home value estimate from HomeLight for free. Our tool analyzes the records of recently sold homes near you, your home’s last sale price, and other market trends to provide a preliminary range of value in under two minutes.

Is central AC truly an upgrade?

Bear in mind: Whatever you spend to install central AC won’t boost your value or asking price dollar for dollar. The typical life of an AC system is 10 to 15 years, and many buyers look at the age of the system instead of the name brand, Sophiea says.

“People always think that when they add a new system, ‘Oh, I just spent $7,000,’ but that’s not considered an upgrade. That’s considered maintenance,” or “the price of homeownership,” he says. “It adds no value to the property. It helps with the salability of the property and with any issues that may come up on the inspection.”

If you live in an area that’s not particularly humid, a combination of options might keep your home cool without the expense of installing a central air-conditioning system, HomeAdvisor.com says. This “green air-conditioning” can reduce home energy use by about 20% to 50% and includes choices such as:

FAQ: Finding your chill zone

Unsure about whether to replace or install a central air-conditioning system? The answers to these common questions should help.

My AC system is old but works well. Should I replace it?

An older unit can be up to 50% less efficient than a newer model and might use R-22 refrigerant, which is more damaging to the ozone layer, says US News & World Report. (The government is phasing out R-22 for R410a, which also is more efficient.) If your system has a low SEER rating, or if your repair costs multiplied by the unit’s age equal more than $5,000, you’re better off with a new unit, which will save you on energy and repair costs, experts say. Plus, newer technology such as a smart thermostat or whole-house humidifier can help keep you comfortably cool.

How can I save money on a central AC installation?

Besides tax credits and rebates, shop in the spring and the fall, when temperatures are milder and the need for that blast of cold air is less urgent, experts say. Some contractors will advertise promotions during these seasons or offer an off-season discount. Get quotes from several contractors, too, to find the best deal.

How do I keep my AC system running smoothly?

Consumer Reports recommends hiring a licensed professional annually to change all filters, vacuum the blower compartments, drain the pan and drainage system, and clean and flush the coils. Beyond that, keep plants and hedges at least 2 feet away from the outside unit to avoid clogging debris. Monthly, clear any dirt and debris from the condenser coils; clean the filters and grills, and check for drain pipe blockages. Also, seal or insulate ducts so that precious cool air doesn’t escape.

Bottom line: How much value does central air add to your home?

When deciding how much value central air adds to your home, our experts advise weighing the enjoyment you’ll get out of the result as well as the expense. If you live in an area where central AC isn’t as prevalent or you don’t want to tinker with an older home, the value may be negligible.

Whitney likens it to installing a swimming pool. “You can always put it in, but you can never take it back. Why would you pay for something when you don’t even know if you need it?” he says. Some buyers won’t care, “so why would you spend the money if it’s not going to make a difference? … I don’t know if you’re going to get your money back.”

Header Image Source: (C5 Media / Shutterstock)