Why Is One HVAC Estimate So Much Cheaper Than Another?

What Florida Homeowners Should Know Before Choosing the Lowest Bid

An AC University Homeowner Guide

“But They’re Both Replacing the Same A/C.”

You get three estimates to replace your air conditioner.

One is $8,000.

One is $10,000.

One is $14,000.

Same size system. Same house. Maybe even similar efficiency ratings.

So…

What the heck?

Is the $14,000 company expensive?

Is something missing from the $8,000 estimate?

Is the $10,000 estimate somehow the Goldilocks of air conditioning?

Could be any of those.

But there’s another possibility:

They might not actually be quoting the same job.

And that’s one of the hardest things about comparing HVAC estimates.

Two proposals can both say:

“Replace 3-ton heat pump system.”

But what those two contractors actually intend to do at your house can be very different.

We recently had this exact conversation with a homeowner.

“I Love You Guys, But I Can’t Justify Another $2,000.”

We gave a homeowner an estimate for a new A/C system.

He liked us.

He wanted to use us.

But another contractor was approximately $2,000 cheaper.

And he basically told us:

“I really like you guys, but I can’t justify spending another $2,000 for the same job.”

Completely reasonable.

Actually, if it were truly the same job, I’d have a hard time justifying it too.

Why spend an extra $2,000 just because our logo is on the estimate?

Except when we compared the proposals…

It wasn’t the same job.

Our proposal included a:

New refrigerant lineset

10-year labor warranty

Smart thermostat

2-inch filter rack

New plywood top for the existing air-handler base

The other proposal didn’t include those things.

And that’s not a criticism of the other contractor.

Maybe they didn’t believe those items were necessary.

Maybe they were offering a more basic installation.

Maybe the homeowner didn’t want all of those things.

That’s okay.

But now the $2,000 difference has some context.

We’re no longer comparing:

A/C replacement: $X

versus

The exact same A/C replacement: $X + $2,000

We’re comparing two different scopes of work that happen to have the same basic description:

Replace the A/C system.

And that brings us to the only reasonable way to explain HVAC estimates in Florida.

The Pub Sub Problem

We’re in Florida.

Let’s talk about Pub Subs.

You walk into Publix and order a Pub Sub.

The guy next to you also orders a Pub Sub.

Both receipts say:

Pub Sub.

Same sandwich?

Well…

Yours might have turkey, provolone, lettuce and mayo.

His has Boar’s Head meat, extra cheese, bacon, avocado, every vegetable available and enough sauce to threaten the structural integrity of the bread.

Both are Pub Subs.

They ain’t the same sandwich.

HVAC estimates can work the same way.

Two proposals might both say:

3-ton heat pump replacement.

But one includes a basic thermostat.

The other includes a smart thermostat.

One reuses the existing refrigerant lines.

The other replaces them.

One has a one-year labor warranty.

The other has ten.

One reuses the existing filter setup.

The other includes a new 2-inch filter rack.

One reuses the existing air-handler base as-is.

The other includes modifications to properly support the new equipment.

One includes surge protection.

The other doesn’t.

One includes permit fees.

Another may list them separately.

Neither proposal is automatically wrong.

They’re just…

Different sandwiches.

And suddenly the prices make a little more sense.

Does That Mean the More Expensive Estimate Is Better?

Nope.

This part matters.

We’re an HVAC contractor, so it would be incredibly convenient for us to write:

“Always choose the more expensive estimate.”

Please don’t.

Sometimes the expensive estimate is better.

Sometimes the cheaper estimate is better.

And sometimes the expensive estimate is just…

expensive.

You can absolutely have two contractors proposing essentially the same equipment, scope and warranty and still get two very different prices.

That’s one reason we think getting multiple estimates on a major replacement is a good idea.

The goal isn’t necessarily to find the lowest number.

It’s also not to find the highest number and assume it must be better.

It’s to figure out:

What am I getting for the difference?

Maybe you don’t want a smart thermostat.

Maybe a 10-year labor warranty isn’t important to you.

Maybe the existing lineset is perfectly suitable and replacing it doesn’t make sense.

Maybe you’d rather keep the extra $2,000.

Fair enough.

The less expensive proposal may genuinely be the better value for your situation.

We don’t need to win every estimate.

We’d rather you understand what you’re buying and choose what makes sense for your house and your budget.

You’re Not Really Buying an Air Conditioner

Okay.

Technically you are.

There will, in fact, be an air conditioner.

But you’re buying a lot more than the equipment.

You’re also buying:

The installation.

The materials.

The modifications.

The workmanship.

The commissioning.

The warranty.

And the company that answers the phone after the installation is finished.

Those things matter.

Two contractors can install identical equipment and produce two very different results.

A beautiful new system connected to poor ductwork is still connected to poor ductwork.

A properly sized system installed incorrectly is still installed incorrectly.

A ten-year parts warranty is great, but somebody still has to diagnose the problem and replace the part.

The boxes are only part of the job.

The rest is making those boxes work properly in your house.

Apparently One of Our Customers Said It Better Than We Did

While putting this article together, we came across this verified review from one of our customers:

★★★★★
“Kevin is a true professional. After pursuing several bids for two systems, it was Kevin’s thorough knowledge in proper equipment size, and the crucial understanding of installation that set him apart from his competitors. Price matters but proper installation supports equipment longevity.”

— Ashley M.
Verified Housecall Pro Customer

Well.

There you go.

We just spent an unreasonable number of words explaining something Ashley managed to summarize in seven:

“Price matters but proper installation supports equipment longevity.”

Thanks, Ashley.

Apparently we could’ve ended the article here.

Equipment Isn’t the Whole Price

This is another reasonable question.

You look up HVAC equipment online.

You see a number.

Then you look at the estimate.

You see a much larger number.

There’s…a bit of a difference there.

That’s because the equipment isn’t the finished installation.

A legitimate HVAC company also has expenses like:

Labor.

Payroll taxes.

Workers’ compensation.

General liability insurance.

Commercial auto insurance.

Trucks.

Fuel.

Tools.

Training.

Licensing.

Continuing education.

Permits.

Refrigerant.

Nitrogen.

Brazing materials.

Electrical materials.

Drain materials.

Duct materials.

Filters.

Equipment pads.

Tie-downs.

Software.

Office expenses.

Warranty work.

Callbacks.

And the approximately seven million other expenses involved in operating an HVAC company in Florida.

And yes:

The company also needs to make a profit.

Scandalous.

Profit Isn’t a Dirty Word

A contractor making money on your job doesn’t mean you got ripped off.

A healthy company needs to make money.

That’s what allows it to maintain trucks, replace tools, train employees, hire good people, stand behind warranties, survive slower months and still answer the phone years from now.

That doesn’t mean every price is reasonable.

It doesn’t mean you shouldn’t compare estimates.

And it definitely doesn’t mean a wrapped truck and a polo shirt automatically make somebody worth whatever number they put on a piece of paper.

It simply means:

“The contractor made money” and “I paid a fair price” can both be true.

That’s actually the goal.

The homeowner gets a properly installed system at a price they’re comfortable with.

The contractor gets paid enough to pay the people who performed the work, operate the company, stand behind the installation and make a reasonable profit.

Everybody wins.

That’s how a good transaction is supposed to work.

Why Can One Company’s Overhead Be So Much Higher?

Because HVAC companies aren’t all built the same.

One company might be an owner and a helper operating from a small shop.

Another might have 50 trucks, a large building, dispatchers, managers, salespeople, warehouse staff and a massive advertising budget.

Those companies obviously don’t cost the same amount to operate.

And ultimately, the cost of operating any business has to be reflected somewhere in its prices.

That’s not automatically good or bad.

The larger company may offer things you value:

More technicians.

More scheduling availability.

A larger support staff.

Different warranty programs.

A smaller company may have lower overhead, more direct owner involvement and a completely different service model.

Neither is automatically better.

They’re just different businesses.

And that can be part of the reason two good contractors look at the same house and arrive at very different prices.

Experience Has Value Too

Not everything on an HVAC estimate comes in a cardboard box.

Experience matters.

Knowing that a return is undersized before installing a new system matters.

Recognizing a drainage problem before it destroys a ceiling matters.

Knowing when an existing lineset can safely be reused — and when it shouldn’t be — matters.

Knowing how to properly evacuate and commission a system matters.

Knowing what airflow the equipment actually needs matters.

You’re not only paying someone for the hours they’re physically standing at your house.

Part of what you’re paying for is knowing what to do while they’re there.

Sometimes experience saves an hour.

Sometimes it saves thousands of dollars.

Sometimes it keeps a brand-new A/C system from performing like garbage.

“But It’s the Same Brand.”

This one comes up a lot.

Two companies quote the same manufacturer.

One costs substantially more.

Again:

Take a look at the scope.

Same brand doesn’t necessarily mean same model.

Same efficiency doesn’t necessarily mean same features.

Same equipment doesn’t necessarily mean same thermostat.

Same equipment doesn’t necessarily mean same warranty.

And even if the model numbers are identical:

The installation still isn’t automatically identical.

Unfortunately, the box does not install itself.

We’ve asked.

Look at What Happens After the Installation

This one is easy to overlook while comparing estimates.

Ask:

What happens if something isn’t right?

Does the company provide a labor warranty?

How long?

Are there conditions attached?

What happens if the system makes a strange noise two weeks later?

What happens if you have an airflow complaint?

What happens if something wasn’t installed correctly?

What happens when you call?

The estimate tells you what happens before the installation.

The warranty and the company behind it tell you a lot about what happens after.

Both matter.

How to Actually Compare HVAC Estimates

Instead of looking only at the totals, put the scopes next to each other.

Compare things like:

Exact equipment model numbers and efficiency
Thermostat or controls
Refrigerant lineset — new or reused
Filter setup
Equipment pad or air-handler base modifications
Electrical work
Drain modifications
Duct modifications
Surge protection
Permit
Parts warranty
Labor warranty
Maintenance included
Exclusions or possible additional charges

Then look at the prices.

That’s when the differences become useful.

If you’ve compared the scope and the $8,000 proposal gives you everything you want while the other proposal is $10,000?

Save the $2,000.

Seriously.

The important thing is knowing whether you’re saving $2,000 on essentially the same job…

or paying $2,000 less for a different job.

Neither answer is automatically wrong.

You just want to know which one it is.

That’s Why We Have an Apples-to-Apples Guarantee

Everything we’ve talked about here is exactly why Klein Cooling has an:

Apples-to-Apples Guarantee.

If you’re comparing our estimate to another licensed contractor and their price is lower, show us the estimate.

We’ll compare the scopes with you.

Not so we can trash the other contractor.

Not so we can tell you everything they proposed is wrong and everything we proposed is brilliant.

We just want to answer:

Are we actually quoting the same thing?

Same equipment — or equivalent equipment.

Same efficiency.

Same thermostat and controls.

Same lineset work.

Same filtration.

Same electrical work.

Same duct modifications.

Same permits.

Same warranties.

Same installation scope.

If the other contractor is offering essentially the same job for less, that’s useful information.

For you and for us.

But if our estimate is $2,000 higher because ours includes a new lineset, 10-year labor warranty, smart thermostat, 2-inch filter rack and modifications to the air-handler base?

Now we know where the difference came from.

No sales gymnastics.

Put the estimates next to each other and let’s look at them.

Maybe there’s something we included that you don’t want.

Maybe there’s something the other contractor didn’t include that you don’t need.

Maybe the other estimate really is the better deal.

Or maybe once everything is compared, the price difference makes perfect sense.

Either way, now you can make the decision with the full picture.

That’s the whole idea behind our Apples-to-Apples Guarantee.

Or, after writing this article:

Pub Sub to Pub Sub.

Apparently we’re going to need to rename it.

The Cheapest Estimate Might Be the Right One

Seriously.

Sometimes it is.

Maybe the contractors are proposing nearly identical work and one simply charges less.

Maybe you don’t value the additional warranty.

Maybe you don’t need the upgraded thermostat.

Maybe some of the additional work another contractor proposed isn’t important to you.

There is absolutely nothing wrong with choosing the cheaper estimate after you’ve looked at the differences and decided it’s the better value.

Keep your money.

We like money too.

The Most Expensive Estimate Isn’t Automatically Better Either

Price doesn’t equal competence.

A $15,000 installation can be installed terribly.

A $9,000 installation can be excellent.

A giant company can employ an incredible technician.

A small company can employ an incredible technician.

And everybody in this industry is capable of screwing something up occasionally.

Including us.

The important part is what happens next.

That’s why we wouldn’t choose an HVAC contractor based solely on:

Cheapest.

Or:

Most expensive.

Look at the work.

Look at the scope.

Look at the reputation.

Look at the warranty.

Talk to the contractor.

Then decide who you’re comfortable having work on your house.

Ask Questions

You should be able to ask questions about an estimate without feeling like you’re being difficult.

Ask:

Why are you replacing this?

Why are you reusing this?

Is this included?

What isn’t included?

What happens if you find something unexpected?

How long is the labor warranty?

Who handles the warranty?

Are permits included?

What happens if I have a problem afterward?

And one of my favorites:

“What would you do if this were your house?”

You can learn a lot from that answer.

Our Advice to Homeowners

When you receive multiple HVAC estimates and the prices are wildly different, don’t panic.

There may be a perfectly reasonable explanation.

Pull the estimates out.

Put them next to each other.

And compare:

Not just:

What equipment are they installing?

But:

What are they actually doing to my house?

That’s where the differences usually start showing up.

Maybe after comparing everything, you discover that the additional $2,000 really doesn’t buy anything you want.

Awesome.

Keep your $2,000.

Maybe you discover that the additional money includes a new lineset, ten-year labor warranty, smart thermostat, better filtration and installation modifications that aren’t included elsewhere.

Now you know.

And then you get to decide whether those things are worth the additional money.

That’s how we think this should work.

No pressure.

No mystery.

No:

“This price is only good while I’m sitting at your kitchen table.”

Just:

Here’s what we’re proposing.

Here’s what it costs.

Here’s why.

You decide.

One Last Thing About the Pub Sub

If two people walk out of Publix carrying sandwiches and one paid more, you probably wouldn’t immediately assume somebody got ripped off.

You’d want to know what each person ordered.

HVAC estimates aren’t all that different.

Both pieces of paper might say:

A/C replacement.

But before deciding which price is better…

Unwrap the sandwich.

See what’s actually inside.

Then decide what it’s worth to you.