Condensing Furnace Sales Continue To Climb
Consumers are willing to pay the price for a more comfortable living environment
Condensing furnaces offer many consumers the benefit of higher efficiency and thus lower energy bills, but for many homeowners, comfort is the primary reason they choose to purchase such equipment. Perhaps that is why sales of these more expensive systems appear to be on the uptick.
That is definitely the case for Bill Thayer Jr., cofounder of EagleAir Heating and Cooling in Livermore, California, who said that even in his temperate climate, customers are seeking the superior comfort condensing furnaces offer. “My customers aren’t buying condensing furnaces because they think they’re going to save money; they’re buying them because they know they’ll enhance the comfort in their homes.”
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About 25-30 percent of Thayer’s customers buy condensing furnaces, which is pretty significant given the mild climate in which he works. “Talking about energy efficiency does not usually sway my customers to buy condensing furnaces. I’ve run the numbers, and the return on investment around here is between 14 and 16 years. That’s why, during sales calls, I focus on personal comfort.”
Comfort is also one of the main reasons customers purchase condensing furnaces from Indianapolis-based Homesense Heating and Cooling, although energy efficiency is a big selling point, as well, said company co-owner, Brian Schutt. “We have pretty long winters here in Indianapolis, and with condensing furnaces, the more you use them, the more benefit you get from that increased efficiency. Customers usually want to know what the payback is for a condensing furnace, but they also want to know the comfort benefits it can provide.”
Schutt estimates that about half of his customers are opting to purchase condensing furnaces, but that number is increasing all the time. “People who plan to stay in their homes for a long time usually choose condensing furnaces. That’s because they will be there long enough to recoup their investments, plus they want the comfort that condensing furnaces provide. If they have the budget, they definitely prefer to spend more for increased comfort.”
About 55 percent of Lennox furnaces sold over the last three years have been condensing models, and sales have grown every year within that time period, said Nathan Behne, product specialist, Lennox Intl. Inc. “Money-saving tax credits are driving the demand, but condensing furnaces also tend to include many technologically advanced features that offer consumers a higher level of comfort as well as control over their complete systems and peace of mind about their reliability.”
Trane, an Ingersoll Rand brand, also sells a pretty even mix of condensing and noncondensing furnaces. In recent years, there’s been a definite trend toward condensing models. “The mix is driven by geography, to a large degree, but even in Southern climates, the higher efficiencies of condensing furnaces is driving demand,” said Jim Lowell, product manager for gas furnaces, Trane.
In addition to comfort and efficiency, quiet operation and advanced controls are attractive reasons to invest in condensing furnaces.
“Homeowners are looking for smart or communicating systems that allow them to make system adjustments remotely for the times they forget to adjust the thermostat before they leave the house,” said Shiblee Noman, product manager, Goodman Mfg. Co. “Many of our condensing gas furnaces offer these controls as well as other features, such as a self-calibrating modulating gas valve, an efficient and quiet variable-speed airflow system, multiple continuous fan options, and an electronic control board with self-diagnostics.”
While homeowners who purchase condensing furnaces enjoy the benefits of better comfort and lower energy bills, contractors who sell that equipment reap the rewards, as well. As Schutt noted, “The folks who invest in modulating high-efficiency furnaces with variable-speed blowers and smart thermostats are usually more conscious of their investments, and they are very aware of the benefits. All of a sudden, they’re more comfortable on every floor of their home, and they’re receiving lower energy bills. These individuals are often very happy about the investments they’ve made, and we usually hear that from them.”
Educating customers about those benefits is imperative, said David Mastrangelo, director of marketing and business development, Goodman. Research indicates homeowners will take the recommendation of their HVAC contractors the majority of the time, he added.
“Homeowners view contractors as the experts on heating and cooling systems,” said Mastrangelo. “When contractors include condensing furnaces in their proposals, homeowners are more likely to take their recommendations.”
That is especially true if contractors can offer the more expensive furnace along with an agreeable monthly payment. “Affording a new HVAC system can be an issue for many homeowners, as these purchases are often viewed as unplanned expenses,” said Mastrangelo. “Consumer financing is a key sales tool that should be offered on every proposal. Consumer financing options soften the often unplanned out-of-pocket expenses for homeowners, which allow them to select the best investments for their families’ long term comfort.”
But, condensing furnaces are not always a good fit for every customer, as converting from a noncondensing to a condensing unit is never a simple drop-in procedure, said Lowell. “The biggest obstacle a contractor faces when working with a homeowner who wants to upgrade to a condensing furnace is the conversion required to the infrastructure of the home. Converting a steel B-vent flue to PVC [polyvinyl chloride], adding a new pipe for combustion air, and considering the additional plumbing components all add cost to the job. There may also be interior sheetrock, roofing, or exterior wall modifications that could require the addition of subcontractors and a lot of added complexity and cost. Occasionally, it becomes nearly impossible to convert, but there are some creative solutions available, such as new types of modular venting systems that can simplify the process, in many cases.”
Fortunately, these types of scenarios are rare, and, in most cases, the installation of a condensing furnace is fairly straightforward.
“Sales growth for condensing furnaces will likely first surface in the replacement business as homeowners become more educated and attracted to replacing their older equipment with higher-efficiency heating equipment,” said Behne. “Once builders recognize homeowners’ appetites for high-efficiency furnaces in their homes, the new construction sector will begin to see increased sales volume in the high-efficiency condensing furnace category.”
Publication date: 11/28/2016