Air Handler vs Furnace: What is the Difference Between Them?

Written By Lester Mclaughlin
Updated On

Are you wondering what the difference between an air handler and a furnace is?

You’ve come to the right place!

In this Blue National HVAC guide, you’ll learn:

  • The differences between air handlers and furnaces
  • The advantages of both
  • Which is more cost-effective

And much more!

Air Handler vs Furnace?

So, if you’re looking for answers on the best way to heat your home, keep reading our detailed guide below to get answers to all of your questions!

Top 2 Differences Between Air Handlers and Furnaces

Many homeowners often wonder about the differences between different HVAC equipment. One question that often comes up is the difference between air handlers and furnaces. In fact, many homeowners are under the incorrect impression that they are the same thing. 

While an air handler and a furnace look the same on the outside, they are two entirely different devices. Here are the two critical differences between them: 

Furnaces Make Heat, Air Handlers Do Not

A furnace creates heat and blows it through the air ducts of your home. It uses either natural gas, propane, or electricity to warm a heat exchanger, which then transfers its heat to the air before it is forced through the home’s ductwork by the blower. The air heats the rooms, then is sucked back to the furnace through the return ducts.

Whether they are gas or electric heat, furnaces are typically housed in gray or silver sheet metal and are mostly rectangular, just how air handlers look.

On the other hand, air handlers do not make heat. They just move air, as their name suggests. They contain a blower motor and a fan that pushes air across the inside coils of a heat pump system or an air conditioner. 

Besides looking similar to a furnace, air handlers have air filters requiring routine replacement or cleaning to ensure good air quality and operation. This filter similarity is another reason that causes people to think they do the same thing.

Air Handlers Have an AC or Heat Pump Coil

As you may have just learned, air handlers don’t create heat themselves as furnaces do. Air handlers move air across air conditioning or heat pump coils which exchange heat to or from the air. 

The air handler is also commonly referred to as the inside or indoor unit of an air conditioner. They are part of a split system, the other part being the outdoor unit or condenser. 

Air conditioners work by using the vapor compression refrigeration cycle. They remove heat from the air when the air handler blows it across the indoor evaporator coils, filled with cold refrigerant. 

That now cool air is pumped through the ductwork into the rooms of the house. Simultaneously, the refrigerant, which is now warmer after removing heat from the air, is sent along the refrigerant lines to the outdoor unit (condenser). 

At the condenser, the heat in the refrigerant is released into the outdoors. It is cooled again by the compressor and sent along the refrigerant loop back to the evaporator coils.

To learn more about how air conditioners work, check out our detailed AC guide.

Air handlers work the same way with heat pumps. However, heat pumps can remove and add heat to the air. An air-source heat pump adds heat to the indoor air by performing the vapor compression refrigeration cycle in reverse. 

As you might have gathered, air handlers direct the airflow across the heated indoor coils when the heat pump operates in heat mode. They can easily be switched to cooling or heating mode on the thermostat. Therefore, this can also lead to further mixups of furnaces and air handlers being the same type of device. 

Your Home Might Have Both

If you live in one of many homes with a furnace and a central air conditioning system, you have both an air handler and a furnace! 

The furnace heats your home in the cold winter months, and the AC unit cools your home in the scorching summers. If you have a furnace and an air conditioning system, you can rest assured that you have both a furnace and air handler (since it is a necessary component of the AC system).

Conversely, if you have an air-source heat pump in your home, there’s a slim chance you also have a furnace. In this case, the heat pump provides cool and warm air to your home via the blower in the air handler. 

Air source heat pumps are more common in climates with milder winters, like the southern US. The furnace and air conditioner combination are primarily used in climate zones with harsh, frigid winters such as the northern US states. 

What Are The Advantages of an Air Handler?

Air handlers work by using a blower motor to move air across the indoor coils of an air conditioner or an air-source heat pump. They are always part of a heat pump or air conditioning system. 

Here are some of the pros and cons of air handlers (as part of a heat pump): 

Air Handlers
Can work as both a heating and cooling systemIndoor blower can be loud 
Smaller indoor footprint than a furnaceHeat pumps don’t work well in extreme cold (work best above 30°F)
Highly energy efficientHeat pump or AC coils can leak refrigerant 
No carbon monoxide or gas leak risksOutdoor unit is loud 
Great energy efficiency at temperatures above 30°F

What Are The Advantages of a Furnace?

In contrast to heat pumps, furnaces work better in climates that experience harsh winters where the temperature is routinely below 30°F. As such, they are fantastic options for homeowners in the northern U.S. and all of Canada. Here are some of the furnaces’ pros and cons: 

Works well in climates with frigid wintersDoes not provide cooling
Highly energy efficientLarger indoor footprint than a heat pump
If you live in a climate with mild summers, you might not need an AC unitGas furnaces directly use fossil fuels
Lower energy bills in cold spellsLouder than a heat pump
An electric furnace is safer than gasRisk of carbon monoxide or gas leaks

Which is More Cost Effective – Air Handler or Furnace?

Since air handlers themselves do not create heat, it isn’t fair to compare their furnaces’ prices.

In other words, since air handlers are just a part of another type of heating system, furnaces’ prices should be compared to the complete system instead- a heat pump.

Therefore here is how the prices of furnaces and air-source heat pumps compare:

Heating SystemAir-Source Heat PumpFurnace
Average Equipment Cost $800 to $3,000$700 to $1,000
Average Installation Cost$3,500 to $7,000$1,700 to $2,500
Total Average Cost$4,400 to $10,000$2,400 to $3,500

As you can see, air-source heat pumps, which include an air handler, are more expensive on average than furnaces. However, they also provide cooling to the home during the summer. So you should consider the cost of an air conditioner too when you’re comparing it to the price of a furnace. 

Since heat pumps are multi-function (heat and cool), this adds considerable value and usefulness to the system. Additionally, if you only want heating and cooling in a single room or small space, you can get a ductless mini-split heat pump for a much lower cost – as little as $1,500. 

Which Option is Best for My Climate?

Furnaces are great systems for heating homes in frigid winter. Since air handlers themselves do not provide heat, let’s take heat pumps into the comparison (since heat pumps have air handlers):

Hot/Mild Climate

Heat pumps are the best option for hot climates that have mild winters, such as the Southern United States

Cold Climate

Furnaces are the best option for the Northern states that have freezing winters. 

Heat pumps work by extracting heat energy from the air and pumping it into the home via the refrigerant. Due to this principle of operation and since frigid air does not contain a lot of heat, heat pumps aren’t as efficient in frigid winters. In this case, the gas-burning heat creation is best. 

Any Kind of Heating System Should Be Professionally Installed

If you don’t have experience installing HVAC systems, don’t take on installing a furnace, an air handler, or a heat pump by yourself. It’s no DIY task. Installation of HVAC systems requires years of on-the-job training, advanced knowledge, special tools, and technical know-how to get it right.

When you need help with a heating system installation, give our expert HVAC technicians a call!

Meet Your HVAC Expert

Lester Mclaughlin

HVAC systems are highly technical and often is the most misunderstood part of the house. From ductwork to heat pumps, I've been exposed to all sorts of issues facing homeowners. It really irks me when a homeowner is given bad advice like refilling freon vs fixing a leak in the system. I'm here to help our website readers with their heating and a/c problems.
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