Why is HVAC System So Expensive Right Now? - An Expert's Perspective

The cost of heating, ventilation, and air conditioning (HVAC) services is on the rise, with prices increasing by 15 to 30 percent in Indiana and beyond. But why is this happening? It's due to a combination of global factors, such as the COVID-19 pandemic, supply chain bottlenecks, the red-hot housing market, labor market restrictions, and even the war in Ukraine. The pandemic has caused a disruption in the global supply chain, leading to shortages of materials and components used in HVAC systems. This has caused prices to increase as manufacturers have had to pay more for these components.

Additionally, the red-hot housing market has led to buyers making offers without conditions, such as a home inspection. This means that any major issues with the heating or cooling system are more likely to be discovered and need to be addressed urgently. The Department of Energy has also mandated new SEER2 test procedures for manufacturers, which will more accurately reflect the current field conditions of the equipment in use. This will allow HVAC systems to last longer and comply with these new efficiency standards.

However, this also means that manufacturers have had to invest more in research and development in order to meet these standards. The rising cost of diesel fuel has also led some air conditioning companies to reduce their service areas. This means that customers may have fewer options when it comes to finding an HVAC contractor. Additionally, all players in the HVAC supply chain are facing increased costs due to labor market restrictions. This includes workers who assemble, install, and repair air conditioning systems. Heat pumps usually last about 12 years, so regular maintenance is essential to take advantage of the system for as many years as possible.

In the past year, many consumers have decided to invest in their homes by improving their air conditioning equipment. However, whether or not you can save costs (and how much it will be) will depend on the size of the space in which the system operates and the type of unit that has been used before. In your air conditioning system, such as heat pumps and variable speed units, for example, there are semiconductor chips. These chips are becoming increasingly expensive due to global demand for them. Additionally, regular maintenance of HVAC equipment is essential regardless of whether you're buying a new system or not. Overall, it's clear that there are a number of factors contributing to the rising cost of HVAC services.

From supply chain disruptions to labor market restrictions and even semiconductor chips becoming more expensive, all players in the HVAC supply chain are feeling the pressure. The best way to minimize your exposure to these pressures is by investing in regular maintenance of your HVAC equipment.

Irene Heimerdinger
Irene Heimerdinger

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