In a market that averaged 9.7 million HVAC unit shipments per year from 2020 to 2024, the industry moved just 7.5 million in 2025.
That’s not a slow quarter, or even a slow year. That’s a behavioral shift.
Homeowners aren’t buying. And the real reason isn’t all that complicated. It is, however, quite interesting.
Sticker Shock is Real – and it’s Getting Worse
Sometimes, the truth can be hard to swallow, and the realities of this business have been brutal in recent years. What used to be a $6,000 to $8,000 replacement now costs up to $15,000 – or even more.
Tariffs have only made things worse. The 10% baseline tariff on all imports, combined with 145% on Chinese goods and 25% on Mexican products, is adding anywhere from 15-30% to equipment costs before they even hit the supply house. This means that some contractors are already absorbing an unbelievable 22% price increase from their distributors, driving the price of new installations up beyond their control.
The result? Fewer homeowners are prioritizing equipment replacements, opting to manage essential repairs instead. Sticker shock, increased regulatory complexity, and higher financing costs have pushed homeowners toward repairing old units rather than replacing them with new ones.
This isn’t a blip. Repair revenue share increased from 21.6% in Q4 2021 to 31.3% in Q4 2025.
Ten percent in four years. The repair economy isn’t coming – it’s already here.
The Problem Nobody Wants to Admit
Here’s where things get fascinating.
According to a recent survey, the top concern among homeowners is an HVAC breakdown during extreme weather. Nearly half of those surveyed (47%) noted this as their biggest worry. Conversely, only 16% chose “a huge, unexpected bill.” Despite all the friction regarding tariffs, price increases, and assumed worries, homeowners are less afraid of the bill than they are of being left without comfort when it matters most.
So, why are they avoiding replacements? It’s not because they don’t want a new system, but rather because the experience feels unpredictable; the only certainty comes in the form of a big upfront cost.
After that payment is processed and installation is complete; too many questions remain unanswered. What about future repairs? What happens after the truck leaves the driveway? Traditional financing addresses the price. It doesn’t fix any other issues.
That’s the gap most contractors fail to fill.
The All-Inclusive Shift to Home Comfort-as-a-Service (HCaaS)
Consumer behavior across nearly every industry has been moving in one direction for years: toward predictable, managed monthly experiences.
Our latest ebook, “What Netflix Understood About Customers That HVAC Still Doesn’t,” highlights this shift in detail. Streaming, phone plans, home security, car subscriptions – all these essential living expenses are becoming more focused on the customer’s experience than ever before, without large upfront costs to deter them.
HVAC is next.
Instead of asking a homeowner to absorb a $15,000 decision all at once, what if you could offer them something different entirely?
- New equipment and installation
- Scheduled maintenance and seasonal tune-ups
- Covered repairs (parts and labor included)
- No trip charges, no diagnostic fees
- 24-hour priority service
- One flat monthly cost. No surprises.
That’s not a loan. That’s the answer to everything the homeowner is afraid of. It takes away the uncertainty that comes with one of the largest purchases they’ll ever make and turns it into a simple, affordable matter of home comfort and convenience – a.k.a. Home Comfort-as-a-Service.
Why This Matters for HVAC Contractors
Right now, in 2026, contractors struggling to stay afloat are the ones waiting for the replacement market to bounce back.
To be clear, it might: forecasters project a recovery trajectory beginning in late 2027 as inventory normalizes and interest rates stabilize. But that’s two years away. Do you really want to wait that long for a potential recovery back to the way things used to be?
Some people will say yes and bide their time, and while they’re struggling, their competition will be positioning themselves for the future of HVAC. These are the companies who recognize that a market where homeowners resist replacements is actually a market primed for an ongoing comfort model.
Think about it: when the upfront cost is the obstacle, removing that barrier completely changes the kitchen table conversation.
That’s what the Premier Program® is built to do. Just think:
- One application
- Instant decisions
- High approval rates
- Recurring revenue
And instead of a $15,000 ask, your customer is offered a flat monthly number that covers everything they were worried about in the first place.
The market is telling you something. The homeowners sitting across from your techs are telling you something.
It’s time you started selling the way they want to buy.
