HVAC equipment prices have risen 60% since 2019, roughly twice the 31% rise in general consumer prices. That is the reason a replacement quote that read $6,000 to $8,000 a decade ago now commonly reads five figures. The gap is not local, and it is not your contractor’s margin: it is visible in federal producer price data for the factories that build the equipment.
Most of the increase happened before the refrigerant changeover. Equipment prices were close to flat through 2024 (+1.4%), then stepped up 3.9% between March and July 2025 as refrigerant surcharges moved through the supply chain, and have kept climbing since.
Separately, two rule changes matter in 2026: the federal 25C tax credit that paid up to $2,000 toward a heat pump expired for anything placed in service after December 31, 2025, and EPA has removed the installation deadline for R-410A equipment built before January 1, 2025.
This page tracks what HVAC equipment actually costs to buy at the factory gate, using the Bureau of Labor Statistics producer price index for air conditioning and heating equipment manufacturing. We update it as new BLS data is released. Everything below is sourced to primary federal data or to the Code of Federal Regulations, and the underlying series are named so you can reproduce every number.
The index: equipment prices against everything else
The cleanest way to see what happened is to index HVAC equipment producer prices and consumer prices to the same starting point. Set 2019 equal to 100 and the divergence is unmistakable. General prices rose about 31%. Equipment prices rose about 60%.
Stated plainly: after stripping out ordinary inflation, HVAC equipment costs about 22% more in real terms than it did in 2019. That is the part homeowners feel as unfairness, and it is real. It is also the part contractors cannot control, because it is priced upstream of them.
When the increase actually happened
The common story is that the 2025 refrigerant rule caused HVAC prices to spike. The monthly data supports a more specific version of that: the rule itself was not the trigger, and the increase arrived roughly three months late.
Through all of 2024, equipment prices moved +1.4%. The EPA rule restricting high global warming potential refrigerants took effect on January 1, 2025, and for the first quarter of 2025 prices barely moved. The step up came between March and July 2025, a 3.9% rise in four months, which lines up with refrigerant producer surcharges reaching distributors rather than with the regulation’s effective date. From the month before the rule took effect through July 2026, equipment prices are up 9.0%.
If you are a contractor being told the refrigerant rule doubled your costs, the federal data does not support that. The rule contributed a step change of several percent. The larger share of the 60% increase accumulated between 2021 and 2023, before A2L refrigerants entered the picture at all. Anyone selling you a strategy built on the refrigerant transition alone is solving the smaller problem.
What is driving the increase
| Driver | What the evidence shows | Confidence |
|---|---|---|
| Equipment costs | Producer prices for HVAC equipment manufacturing up 60% since 2019, versus 31% for consumer prices generally. This is the dominant, directly measured driver. | High, primary federal data |
| Labor | Average hourly earnings for plumbing, heating and AC contractor employees rose from $30.39 in 2019 to $42.61 in July 2026, up 40.2%. Real but smaller than equipment, and it outpaced inflation only modestly. | High, primary federal data |
| Refrigerant transition | Visible as a 3.9% step between March and July 2025, plus ongoing A2L equipment premiums. Material but not the main event. | Moderate, inferred from timing |
| Loss of the 25C credit | Not a price increase, but a real out-of-pocket increase of up to $2,000 on qualifying heat pumps installed from January 1, 2026. | High, statutory |
| Tariffs and materials | Widely cited in trade press as a contributor. We have not been able to isolate a tariff-specific effect in the federal series, so we do not quantify it here. | Low, not independently verified |
The headcount side is worth noting because it cuts against a common claim. Employment among plumbing, heating and air conditioning contractors rose from about 1,141,000 in 2019 to about 1,355,400 in July 2026, an increase of 18.8%. The trade added workers. A pure labor shortage story does not fit a workforce that grew by roughly a fifth.
What you can still install in 2026
This is the most misreported topic in the trade right now, and a large amount of published guidance is out of date. Here is what the regulation currently says.
Under 40 CFR 84.54(a)(1), effective January 1, 2025, no one may manufacture or import self-contained residential and light commercial air conditioning and heat pump products using a refrigerant with a global warming potential of 700 or greater. R-410A has a GWP of 2,088 and is therefore out for new production.
The installation question is separate. The original rule paired the manufacturing ban with an installation cutoff. On May 26, 2026, EPA published a final rule (91 FR 31284, RIN 2060-AW39, docket EPA-HQ-OAR-2025-0005, effective July 27, 2026) that, in EPA’s own words, “allows the inventory of residential and light commercial air conditioning and heat pump equipment that was manufactured in the United States or imported into the United States before January 1, 2025, to continue to be installed.”
| Equipment | Federal status in 2026 |
|---|---|
| R-410A residential split systems, components built before Jan 1, 2025 | May continue to be installed. No federal end date currently set. |
| New R-410A residential or light commercial equipment | Cannot be manufactured or imported as of Jan 1, 2025. |
| Existing R-410A systems in service | Legal to operate and service. Service refrigerant remains legal to produce and sell. |
| Variable refrigerant flow (VRF), GWP 700 or greater | Restricted from Jan 1, 2026. Installable before Jan 1, 2027 where all components were built or imported before Jan 1, 2026, and before Jan 1, 2028 where a building permit issued prior to Oct 5, 2023 specifies the restricted refrigerant. |
The federal sell-through is not the whole picture. Several states run their own HFC programs that can be stricter than the federal rule, and New York’s 6 NYCRR Part 494 is the one most likely to catch contractors out. Reporting on the precise New York dates has been inconsistent, so confirm the current text with the state agency or your distributor rather than trusting a summary, including this one, for a job you are about to sell.
If you are a homeowner
Should you wait for prices to come down?
Nothing in the data suggests a decline. Equipment prices rose in 21 of the 31 month-over-month comparisons since January 2024, and the most recent reading, August 2026, is the highest in the series going back to 2019. Waiting has reliably cost money since 2021. If your system is functioning, waiting is still reasonable. If it is failing, waiting is a bet the data does not support.
Is the tax credit really gone?
For federal 25C purposes, yes. The IRS states the credit applies to qualifying property placed in service before December 31, 2025. Installation date controls, not purchase date, so equipment bought in late 2025 and installed in 2026 does not qualify. State and utility rebates are unaffected by this and are often worth more than people assume, so check your utility before assuming there is no incentive.
Is a cheaper R-410A system still an option?
Federally, yes, if the equipment was built before January 1, 2025 and your state allows it. Distributors are still moving that inventory and it is usually cheaper. The trade-off is that you are buying into a refrigerant that is being phased down, which will make service refrigerant progressively more expensive over the system’s life. For a system you expect to keep 15 years, that is a real cost. For a rental you plan to sell in three, it may not be.
How do you tell a fair quote from a padded one?
Ask the contractor to separate equipment cost from labor on the proposal. Equipment is the line that moved, and a contractor who can show you the invoice is usually the one not padding. A quote that is dramatically below the others in your market is more often a scope difference, for example reusing failing ductwork or skipping a load calculation, than a genuine bargain.
If you are a contractor
The number your customer is anchored to
A homeowner who last replaced in 2016 or 2017 is anchored to that price. The producer price index gives you a defensible way to explain the gap without sounding defensive, because it is a federal series that has nothing to do with your business.
“Before I show you the number, I want to explain what changed, because it is going to be higher than the last time you did this. The equipment I install is priced by the manufacturer, and federal producer price data shows that equipment has gone up about 60% since 2019 while general prices went up about 31%. That is not my markup, that is the factory. On top of that, the federal tax credit that would have taken up to $2,000 off this job expired at the end of last year. Here is what I can control, and here is where I can save you money.”
Where the margin actually is
If equipment is up 60% and your labor cost is up 40.2%, holding a fixed percentage markup on equipment has quietly inflated your equipment margin in dollar terms while your labor margin has compressed. Shops that have not re-cut their pricing model since 2019 are frequently winning on the box and losing on the truck. Price the labor line deliberately rather than letting it ride as a percentage of a number that tripled.
The R-410A inventory question
The federal installation deadline is gone, which means pre-2025 inventory is a legitimate offering again rather than a liability. Two cautions. First, confirm your state has not set its own rule. Second, put the refrigerant phasedown in writing when you sell it, because a customer who learns in year six that service refrigerant has become expensive will remember what you did and did not tell them.
Methodology
Equipment prices are the Bureau of Labor Statistics producer price index for NAICS 333415, air conditioning, warm air heating and commercial and industrial refrigeration equipment manufacturing, series PCU333415333415, retrieved from the BLS public API v2. General consumer prices are CUUR0000SA0, the consumer price index for all urban consumers, all items, US city average. Labor figures are BLS Current Employment Statistics for NAICS 238220, plumbing, heating and air conditioning contractors: series CEU2023822003 for average hourly earnings of all employees and CEU2023822001 for all employees in thousands.
Index values set each series to its own 2019 annual average, calculated as the mean of the twelve monthly observations. The real increase is the ratio of the two indexed series, which removes general inflation from the equipment figure. Where 2026 is shown as an annual point it is the average of the months available at publication: through August for equipment prices and July for consumer prices. Regulatory text is quoted from the current Code of Federal Regulations at 40 CFR 84.54 and from the Federal Register.
Limitations
- Producer prices measure what manufacturers charge, not what a homeowner pays installed. Installed prices include distributor margin, contractor labor, permits and local market conditions, none of which this series captures. The direction is reliable; the exact pass-through to a specific quote is not.
- PCU333415333415 covers commercial and industrial refrigeration alongside residential HVAC, so it is broader than residential equipment alone.
- The series is not seasonally adjusted, so month-to-month moves carry some seasonal noise. Comparisons here use multi-month spans to reduce that.
- Attributing the March to July 2025 step up to refrigerant surcharges is an inference from timing, not a decomposition of the index. BLS does not publish that breakdown.
- We do not quantify tariffs. Trade press attributes part of the increase to them and that may well be correct, but we could not isolate it in the federal data and will not publish a number we cannot source.
Frequently asked questions
How much has HVAC equipment actually gone up?
Producer prices for HVAC equipment manufacturing rose 60% between the 2019 annual average and July 2026, according to BLS series PCU333415333415. Consumer prices generally rose 31% over the same period, so equipment has risen roughly twice as fast as inflation, or about 22% in real terms.
Did the refrigerant change cause HVAC prices to spike?
It contributed, but it is not the main cause. Equipment prices moved +1.4% across all of 2024 and then rose 3.9% between March and July 2025, which is a step change rather than a spike, and it arrived about three months after the rule took effect. Most of the cumulative increase since 2019 accumulated before A2L refrigerants entered the market.
Can R-410A systems still be installed in 2026?
Under federal rules, yes, if all components were manufactured or imported before January 1, 2025. EPA’s final rule published May 26, 2026 (91 FR 31284) allows that inventory to continue to be installed and removed the previous installation cutoff. New R-410A equipment cannot be manufactured or imported. Some states impose stricter rules, so confirm your state before relying on the federal position.
Is there still a federal tax credit for a heat pump in 2026?
No. The Section 25C Energy Efficient Home Improvement Credit, worth up to $2,000 for a qualifying heat pump, applies to property placed in service before December 31, 2025. Installation date controls rather than purchase date. State and utility rebates are separate and may still apply.
Will HVAC prices come down?
There is no sign of it in the data. August 2026 is the highest reading in the series and prices have risen in most months since early 2025. We take no position on forecasts, but nothing in the published federal data points to a decline.
Are contractors marking up more than they used to?
The measured drivers sit upstream of contractors. Equipment producer prices are up 60% and contractor hourly earnings are up 40.2%, both since 2019. Individual pricing varies, which is why comparing itemized quotes that separate equipment from labor is more useful than comparing totals.
The HVAC Brief. “HVAC Prices in 2026: The Data Behind the Sticker Shock.” Analysis of BLS producer price index series PCU333415333415 and consumer price index CUUR0000SA0. Published August 19, 2026. https://thehvacbrief.com/hvac-prices-2026/
Journalists and researchers may reproduce the charts and figures with attribution to The HVAC Brief. Underlying data is public and reproducible from the BLS public API using the series identifiers named in the methodology.
Sources
- US Bureau of Labor Statistics, Producer Price Index by Industry: Air Conditioning, Warm Air Heating, and Commercial and Industrial Refrigeration Equipment Manufacturing, series PCU333415333415, monthly, January 2019 to August 2026. Retrieved via the BLS Public Data API v2, api.bls.gov.
- US Bureau of Labor Statistics, Consumer Price Index for All Urban Consumers, All Items, US City Average, series CUUR0000SA0.
- US Bureau of Labor Statistics, Current Employment Statistics, Plumbing, Heating and Air-Conditioning Contractors (NAICS 238220), series CEU2023822003 and CEU2023822001.
- US Environmental Protection Agency, 40 CFR 84.54, Restrictions on the use of hydrofluorocarbons, current text via eCFR.
- US Environmental Protection Agency, “Phasedown of Hydrofluorocarbons: Reconsideration of Certain Regulatory Requirements Promulgated Under the Technology Transitions Provisions of the American Innovation and Manufacturing Act of 2020,” final rule, 91 FR 31284, published May 26, 2026, effective July 27, 2026, RIN 2060-AW39, docket EPA-HQ-OAR-2025-0005.
- Internal Revenue Service, Energy Efficient Home Improvement Credit, Section 25C.
- New York State Department of Environmental Conservation, 6 NYCRR Part 494, Hydrofluorocarbon Standards and Reporting.
The HVAC Brief is an independent trade publication. We do not sell equipment, take manufacturer advertising, or accept payment for placement in our research. Corrections: if you find an error in this analysis, tell us and we will fix it and note the change.
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