US Residential HVAC Market

U.S. Residential HVAC Market Size

The U.S. residential HVAC market was estimated at USD 15.4 billion in 2024 and is expected to reach USD 31.4 billion by 2034, growing at a CAGR of 7.5% from 2025 to 2034. The rising demand for energy-efficient and sustainable cooling solutions is the primary factor boosting the market growth. With an increasing focus on sustainability and energy efficiency, consumer behavior has changed significantly in the last several years. People are choosing HVAC systems that offer comfort, energy efficiency, and minimal environmental impacts

As per the International Energy Agency, space cooling energy consumption went up by more than 5% in 2022 compared to 2021. As per the U.S. Energy Information Administration, almost 88% of U.S. households employ Air-conditioning (AC). Two-thirds of U.S. households utilize central AC or a central heat pump as the primary AC device. Increased space cooling energy consumption results in peak electricity demand, particularly on hot days, elevating the likelihood of power outages.

The U.S. residential HVAC market is witnessing a growth in demand, fueled by new technologies for HVAC emerging on the horizon. These technologies are enhancing energy efficiency, improving Indoor Air Quality (IAQ), elevating user comfort, and providing new market opportunities. These new controls continuously monitor variables such as occupancy, ambient temperatures, and humidity and modulate HVAC performance to balance economy with comfort. Inclusion of Internet of Things (IoT) into unitary HVAC products has also created new opportunities for remote diagnosis and monitoring.

U.S. Residential HVAC Market Trends

• One of the emerging trends that are shaping the industry's future is the incorporation of smart technologies in HVAC systems.
  
• Renewable energy sources provide another avenue of innovations in the HVAC sector. As customers become increasingly aware of their carbon footprint, there is increasing demand to use solar power or geothermal heat pumps as alternative sources of energy to heat & cool their homes. These technologies reduce carbon emissions while offering long-term economic benefits.
  
• Apart from technological progress, there is an increasing requirement for HVAC solutions that suit personal customer needs, building structures, and environmental conditions. There is an increasing requirement for quieter & low noise HVAC products that are suitable for residential applications.
  
• Voltas has launched its AC product line-up at the ACREX India. The new Inverter Scroll Chillers have a cooling capacity ranging from 12-72 TR with eco-friendly refrigerants. The product is IoT enabled, BMS compatible, silent in operation and convenient for the user, as it can be operated through a mobile app.
  

U.S. Residential HVAC Market Analysis

Based on product type the market is segmented into heat pumps, split air conditioners, and furnace. In 2024, the heat pumps segment generating revenue of USD 7.4 billion and split air conditioners segment is expected to grow at CAGR of around 7.4% during 2025 to 2034.

• As nations and regions establish climate targets, pressure to cut carbon emissions is propelling profound transformations in HVAC systems. Heat pumps, which draw electricity to move heat instead of producing it, are regarded as a central technology in decarbonizing the home. Integration of digital technologies into heat pump systems and expansion of solar-thermal energy supply for heat pumps is the new trends in overall heat pump market.
  
• By combining heat pumps with solar photovoltaic (PV) systems, homes can be both heated and cooled, as well as powered, using clean on-site energy. Not only does this minimize the family home's carbon footprint, but it also saves a lot on utility bills, especially where net metering ensures homeowners can sell excess electricity back into the grid.
  
• HVAC units with in-built air cleaning technology are getting more advanced. Such units not only remove dust and allergens but also harmful particles such as viruses, bacteria, and VOCs. Advanced filtration technologies such as UV-C light, HEPA filters, and bipolar ionization will increasingly be incorporated into new heat pump designs.
  
• Carrier launched a new line of 4-14 kW heat pumps for residential and commercial building applications with a coefficient of performance of up to 4.90. The system employs propane as a refrigerant and is said to achieve leaving water temperature of up to 75 C.
  

According to the application, the U.S. residential HVAC market is segmented into residential and light commercial. The residential segment captured 87% of the market in 2024, due to wide adoption of energy-efficient and sustainable cooling solutions.

• At the residential category, homeowners are focusing more on HVAC systems with energy efficiency and smart technology features to save on utility bills and improve indoor comfort. The use of programmable thermostats, home automation systems, and energy-efficient heat pumps and air conditioners is gaining momentum with the help of federal and state incentives that offer tax credits and rebates for replacing existing systems with environmentally friendly HVAC solutions.
  
• LG Electronics launched its new series of DUALCOOL Inverter air conditioners under its AI+, health and hygiene portfolio. Under the new series, LG is launching air conditioners that are pre-installed with features like AI +, Plasmaster Ionizer++, Hot & cold, and LG ThinQ (WIFI AC’s) which can be controlled through voice command, thereby making them touch free.
  
• Retail, hospitality, and office spaces are focusing more on improving indoor air quality and refining temperature control to enhance employee productivity and customer satisfaction.  
  

According to the installation, the U.S. residential HVAC market is segmented into new construction and replacement/retrofit. The replacement/retrofit segment dominated about 55% of the market in 2024, due to rising consumer spending on home renovation.

• In the new build construction industry, growing housing projects and rising usage of energy-efficient systems are propelling market growth. Construction companies are integrating smart HVAC solutions with advanced automation, zoning controls, and environmentally friendly refrigerants to address energy efficiency requirements and consumer demands.
  
• Replacement and retrofit market remain predominant, driven by aging HVAC systems, tighter environmental regulations, and consumer demand for affordable, energy-efficient replacements. Homeowners are replacing older equipment with high-SEER products, heat pumps, and high-efficiency thermostats in order to decrease energy consumption and comply with emissions standards.
  

U.S. Residential HVAC Market Share

• The top five companies in Johnson Control, Trane Technologies, Carrier, Daikin, Midea and they collectively hold a share of 30%-35% in the market.
  
• These companies continue to acquire and merge with others, expand facilities, and make various collaborations to increase their product offerings, access customer bases, and secure their market positions.
  
• Bosch Group has got approval from the Competition Commission of India (CCI) for the purchase of Johnson Controls International's (JCI) residential and light commercial heating, ventilation, and air-conditioning (HVAC) business worth $8 billion. Bosch would merge the purchased businesses with its Home Comfort Group after completing the acquisition. Its aim would be to expand its market position in the U.S. and Asian markets. This step is part of Bosch's strategy to strengthen its presence in the HVAC market and tap into growth prospects in the international market.
  
• Panasonic Corporation has announced that its Heating & Ventilation A/C Company (HVAC Company) launch the OASYS Residential Central Air Conditioning System in the US market. It can cut energy consumption for heating and air conditioning by more than 50% compared to traditional systems, creating a healthy and comfortable environment.
  

U.S. Residential HVAC Market Companies

Major players operating in the U.S. residential HVAC industry are:

• American Standard
• Bosch
• Bryant Heating & Cooling Systems
• Carrier
• Daikin
• Goodman Manufacturing
• Honeywell
• Ingersoll Rand
• Johnson Controls
• Lennox
• LG Electronics USA
• Midea
• Panasonic
• Rheem
• Trane Technologies       
  

To improve the services and market share key players are constantly investing in technological activities and are also entering into partnerships to provide improved and better solutions for the customers. These investments are benefiting both companies and customers as they help develop and offer solutions as per the changing technological trends and thus the customer requirements.

Daikin reveals a significant expansion of its Multi + total solution to meet larger family needs. The highly efficient Multi+ system integrates room heating and cooling with Domestic Hot Water (DHW) in a single energy-saving solution. More connectivity between units, combined with the launch of higher tank capacities, provides greater flexibility and scope for system extension.

Honeywell revealed that Bosch's latest series of heat pumps will feature Honeywell's energy-efficient Solstice low-global warming potential (GWP) refrigerant. Under this partnership, Bosch technicians will be trained to safely install and maintain these next-generation low-GWP solutions. The partnership with Bosch also aligns with Honeywell's recently announced strategy to focus its portfolio on three compelling megatrends, including the energy transition.

U.S. Residential HVAC Industry News

• In December 2024, Daikin releases its Smart Control System (SCS), Daikin-designed control solution for the operation of hydronic plants such as chillers, heat pumps, air handling units and fan coils.
  
• In April 2024, Trane announced they have started developing a partnership with a well-known home automation company for the integration of their HVAC systems with smart home devices. This is aimed at improving energy efficiency along with user comfort with AI-powered climate control.
  
• In March 2024, Carrier unveiled its newest line of high-performance heat pumps that are adapted for colder climates. The company claims that these units can operate at ambient temperatures as low as -13°F (-25°C), which would increase the market potential for heat pumps in the Northern states.
  
• In March 2024, Johnson Controls acquired a smaller but technologically advanced ductless mini-split HVAC company, which should strengthen the company's position in the Ductless HVAC market since this segment is growing very rapidly.  
  

This U.S. residential HVAC market research report includes in-depth coverage of the industry with estimates & forecasts in terms of revenue (USD Billion) and volume (Thousand Units) from 2021 to 2034, for the following segments:

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Market, By Product Type

• Heat pumps
  • Ducted
    • Vertical discharge
    • Side discharge
  • Ductless 
• Spilt air conditioner
  • Ducted
    • Vertical discharge
    • Side discharge
  • Ductless
• Furnace
  • Gas furnaces
  • Oil furnaces  

Market, By Application

• Residential
  • Single family
  • Multi family 
• Light commercial      

Market, By Installation  

• New construction
• Replacement/retrofit     

Market, By Distribution Channel  

• Direct sales
• Indirect sales