The unit was $1350, I added a line set cover, pad and feet for another $200, and needed about $200 in electrical equipment - it was a long wire run and code requires installing a disconnect box. The only special tool was a hole saw bit for running the coolant lines.
So maybe $1850 all-in, plus 8 hours labor. I’m sure a pro could do it in half the time. But the low end for a pro install is $5k.
I get that they have insurance and warranty or whatever, but that’s a damn juicy margin.
Come to your house to quote, and only land 1/4 quotes maybe.
Schedule the workers
Order the equipment.
Get an electrical permit.
Pay for the truck and all the tools.
Insurance for the company and trucks.
Advertising costs
Warranty and callbacks
I can assure you that this is not the get rich quick scheme you may think it is.
It is in fact a get rich scheme.
Most of the local firms (Dick's local $town hvac/plumbing/electrical) are owned by massive PE firms (Saudi + other billionaires) which pretty much own the entire businesses all over US. They keep the local name to make people believe they are giving business to a local guy.
Another roommate of mine was a plumber.
The guys who do the actual work get paid close to nothing ($20 - $22/hour) and live on day to day basis.
Plumbing company quoted me $3000 to replace a broken water heater in the middle of peak winter. I paid my guy $300 for labor (heaters are $500 - $1000 from lowes depending on how long of warranty you want) and he was super happy for making a lot of money.
I mentioned warranty and insurance.
You don’t need to “schedule workers” if you are owner operating. Maybe you want a (non-skilled) helper to speed up the install, but you absolutely could install solo. That said, you will need a licensed electrician to run the circuit.
In my metro, hvac contractors can get ten-packs of permits for mini-split installs, and at most one out of ten is inspected. It’s a rubber stamp if you’re a pro, and the individual permit is maybe $50.
And that $5k I mentioned is the low bid, which you’ll only see if you know how to find contractors who aren’t private equity fronts. These guys are not advertising, but they stay busy by having the best price. There are shops that will happily charge you double for the same work.
I never said it’s a get rich quick scheme. It is just highly compensated for owners without requiring the level of expertise of something like a plumber or electrician. I’m curious what is happening in the market to support these margins.
Then it took me 2 days between pouring concrete pad for the heat pump, installing the heat pump and bolting it in, running the copper lines, drilling the exit hole, running the drain piping, learning how to use all the tools, running the electric and control cables and installing a new breaker and 220 subpanel, pressure testing, vacuum testing, flaring, releasing vacuum and all the stuff you have to do. I also had to spend several nights watching youtube and get a EPA 608 certification for handling refrigant which took another day.
Wouldn't have been worth it for a single unit, but was worth it for installing 3, and now I can do additional units for basically $0 overhead and of course no one would even have to know if I installed it and now I can order unlimited amount of refrigerants to my doorstep.
Having plumbed my entire house, and done my entire house electrical system, I would say the level of expertise to install a mini split is higher than either alone. You have to do electrical, plumbing, refrigerant handling, pressurized equipment handling, be liable for massive federal/EPA fines if you do something wrong, and on top of that I had to do masonry work.
Hardly anyone wants to do that so we're stuck with the status quo. You're basically stuck either paying through the nose or finding a family/friend with the equipment and expertise or doing it yourself.
Suppose we wave a magic wand and everyone in society becomes equally wealthy. That doesn't solve the fundamental problem of a contractor shortage. It just means we no longer have prices as a method for matching contractors with jobs to the same degree as previously. Without prices being bid up as high, there is less incentive to go into contracting, meaning that the shortage is liable to persist for longer.
I know our labour costs are going to be lower, but not that much lower. Glassdoor indicates that salary for a US HVAC installer is about US$60k, and in NZ a local equivalent says NZ$60k, so I’d expect the numbers to be the same.
Oh and that price includes all taxes and excludes rebates (which most of us don’t qualify for anyway)
