Repair or replace? A rule that survives contact with a quote
Every contractor has a number they use to decide for you. Here is how the arithmetic works, so you can run it yourself before anyone quotes you a system.
Repair versus replacement threshold
Short answer: if the repair costs more than half of a new system, or the unit is past 75 percent of its expected life and needs a major part, replace it. A $400 blower motor on a 14-year-old condenser is still worth doing. A $2,200 compressor on the same unit is not.
| Common repair | Typical cost | Verdict on an old unit |
|---|---|---|
| Capacitor, contactor, thermostat | $150 to $400 | Repair it |
| Condenser fan motor | $300 to $700 | Repair it |
| Blower motor | $400 to $900 | Repair it |
| Evaporator or condenser coil | $400 to $900 part, more with labour | Repair if the rest is sound |
| Leak search and recharge | $300 to $700 | Repair once, not twice |
| Compressor | $1,200 to $2,800 | Usually replace the system |
| Heat exchanger (furnace) | $1,000 to $2,500 | Replace, and stop using it |
Installed cost for a full system runs $3,000 to $9,500, with most matched replacements landing at $4,500 to $6,000.
The 50 percent rule, and where it fails
The rule most contractors carry around is simple: if the repair costs more than half of what a new system would, replace. It is a decent starting point because it encodes the real trade-off, which is that money spent on a 15-year-old compressor buys you very little remaining life.
Where the rule fails is on the boundary. A $2,000 repair on a 10-year-old unit is 40 percent of a $5,000 replacement, so the rule says repair, and that is usually right. The same $2,000 on a 16-year-old unit with an R-22 circuit is throwing money at a system that will need another $2,000 within three years, and the rule's arithmetic doesn't capture that.
So use the percentage as a screen, then apply the age and the refrigerant before deciding.
How long equipment actually lasts
A central air conditioner lasts 12 to 17 years, a gas furnace 15 to 20, and a heat pump 10 to 15. The ranges are wide because the same equipment in a shaded basement and in a hot attic are different machines in practice, and because a system that runs continuously because it was undersized wears faster than one that cycles.
Past 75 percent of that range, any repair beyond a minor part should be weighed against replacement, because the remaining life is short and the next failure is usually the expensive one.
What actually changes when you replace
The efficiency gap is where the money is, and it is larger than most people expect. A 1990s system at 10 SEER against a current 15 SEER2 minimum is roughly a 30 percent cut in cooling energy. If cooling is $900 a summer, that is about $270 a year, and it is the argument that makes replacement on a failing unit easy to justify.
Two things to be careful about. The nameplate SEER2 is not what you will see in the house; ducts in an attic, an undersized return and a badly matched coil all eat into it. And a high-efficiency system on bad ducts can use more energy than a mid-efficiency system on good ones, which is why a duct inspection belongs in the decision.
Five cases where replacement wins even though repair is possible
- The system runs R-22. Production ended in 2020 and the remaining supply is reclaimed, so a recharge can cost more than the part that leaked. Refrigerant alone can decide this one.
- Second major repair in three years. One compressor is bad luck; two failures in a system point at something else, and the third is on its way.
- The heat exchanger is cracked. On a furnace, this is a carbon monoxide problem, not a budget problem. Stop using the equipment and replace it.
- The unit is sized wrong. An oversized air conditioner short-cycles, never dehumidifies, and no repair fixes that. Replacement with a correct Manual J size is the only real answer.
- You are renovating anyway. Line sets, electrical and duct changes cost far less when the walls are open, and doing them later means paying twice.
Where repair is clearly right
Minor electrical parts, motors, thermostats and single leaks on equipment under 10 years old. These are cheap relative to a system, they restore full performance, and the equipment still has most of its life ahead of it. Replacing a working 8-year-old system because a contractor's proposal was persuasive is the most common way homeowners lose money on HVAC.
Also repair when the complaint is comfort rather than failure. A room that stays hot in summer is usually a duct or balancing problem, and a new condenser will not fix it. Get a static pressure reading and a room-by-room load before spending five figures on equipment.
Get the diagnosis in writing. Ask for the failed part, the measured values that show it failed, and the part number. A technician who cannot tell you the actual reading that justified a $2,200 compressor is asking you to take the most expensive decision in the house on trust.
Frequently asked questions
Is it worth replacing a 15-year-old air conditioner?
If it is working, no. If it needs a compressor or a coil, yes: the repair is a large fraction of a new system and the remaining life is short. A 15-year-old unit that needs a $200 capacitor is still a repair, not a replacement.
What is the 5,000 dollar rule for HVAC?
A shorthand some contractors use: if the repair exceeds $5,000, replace the system. It is a rough version of the percentage rule and it ignores the age of the equipment, so treat it as a prompt to do the arithmetic rather than the answer.
How much does a new AC compressor cost installed?
$1,200 to $2,800 depending on tonnage, refrigerant and warranty. On a system past 12 years, that is usually more than the remaining value of the equipment, which is why compressor failure is the classic replacement trigger.
Should I replace my AC and furnace at the same time?
If both are more than 15 years old, usually yes: the labour overlaps, the coil and air handler get matched, and one crew does the work. If the furnace is 8 years old and healthy, replacing only the outdoor unit and coil is the better spend.
Does a new AC really lower my bills?
By roughly 25 to 35 percent on cooling energy if you are coming from a 10 SEER system to a 15 SEER2 minimum, less if the old unit was already 13 SEER. Duct condition can erase most of that gain, so it is worth measuring before you count on the savings.
Can I replace just the outdoor unit?
Technically yes, and it is usually a mistake. A new condenser on an old coil is not an AHRI-matched pair, which loses efficiency and can void the equipment warranty. Replacing the coil at the same time adds $400 to $900 and is standard practice.
Disclaimer: Repair and installation prices are typical 2026 US ranges, not quotes. Actual prices depend on equipment tier, refrigerant type, local labour rates, permit fees and how accessible the equipment is. Any decision about a gas furnace or a refrigerant circuit should involve a licensed technician, and combustion equipment needs a safety inspection rather than a judgement call.
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