One of the biggest distinctions within the HVAC industry is between the residential and commercial markets.
Residential HVAC deals with the heating and cooling systems of homes and small businesses, while commercial HVAC works with the heating and cooling systems of corporate and industrial buildings. While residential and commercial HVAC share many of the same fundamental principles, critical differences exist in working conditions, pay, team makeup, market outlook, and HVAC system size and complexity.
Straight out of school, HVAC professionals may have an easier time getting started in the residential sector, where the experiential requirements are often lower and the HVAC systems involved are simpler to manage. But commercial HVAC can offer a different business model—one that’s more collaborative, more technically-focused, and sometimes higher-paying. HVAC professionals may even split their time between both commercial and residential work.
For HVAC professionals, the decision between residential and commercial is often one of personal preference. Residential HVAC is more customer-focused and independent, while commercial HVAC is more technical and collaborative. Some of the necessary skills overlap across both areas, while others are unique to one versus the other.
To get a detailed look at the differences between residential and commercial HVAC, check out our side-by-side comparison chart below.
Residential HVAC professionals work on the HVAC systems in residential properties, such as homes and small businesses.
Commercial HVAC professionals work on the HVAC systems in commercial properties, such as those in warehouses, large stores, and office buildings.
Residential HVAC systems are located within or beside houses. As such, residential HVAC professionals will often find themselves working indoors (occasionally in attics and crawl spaces), or along the side of a house, and relatively protected from the elements.
Residential HVAC is a somewhat cyclical industry, with the peak business seasons often coming in summer and winter. Since residential buildings are occupied full-time, residential HVAC professionals may need to be on-call outside of normal working hours.
Commercial HVAC systems are often located on the top of a commercial building. As such, commercial HVAC professionals will often find themselves working outdoors, and exposed to the elements.
Commercial HVAC is slightly steadier than residential HVAC, and working hours typically mirror those of a traditional business. Even if a commercial building is monitored around the clock, commercial HVAC workers will often work in assigned shifts.
While residential HVAC professionals can work with a wider team, they usually work relatively independently.
Residential HVAC also requires more direct interactions with customers, who are often either families or a single contractor.
Commercial HVAC professionals often work in a collaborative system, which can include multiple contractors, architecture firms, technicians, and other stakeholders. There is less direct interaction with customers, who are often corporations or municipalities.
In a 2013 report, single-family homes made up nearly 29 percent of the overall HVAC market in the US.
A more recent report (February 2020) put the global residential HVAC sector at 40 percent of the total HVAC market.
The residential HVAC market is linked to the residential market as a whole, with new house construction and new homeownership being critical factors.
While the Covid-19 pandemic has caused erratic and sometimes irrational spikes and dips in the real estate market, the need for new ventilation systems may lead to an increase in residential HVAC services and sales. As people work from home with a greater frequency, it’s also possible that those homes will see a greater investment in their current HVAC systems.
In a 2013 report, commercial HVAC (office buildings, manufacturing/industrial buildings, educational buildings, and healthcare/institutional buildings) made up approximately 46 percent of the overall HVAC market in the US.
A more recent report put the global commercial HVAC sector at 60 percent of the total HVAC market.
The commercial HVAC market is linked to the commercial real estate market as a whole, as well as the retail and corporate industries.
The Covid-19 pandemic is forcing a rethink about how commercial space is used and ventilated. The overall commercial real estate market may contract, but the parts of it which survive will require upgrades and maintenance to their HVAC systems.
While residential HVAC professionals typically make slightly less than their commercial counterparts, residential HVAC often comes with the opportunity to boost one’s hourly pay with commissions on the sale of additional parts or replacements. In residential HVAC, one’s experience can be less of a prerequisite than salesmanship.
Commercial HVAC professionals typically earn slightly more than their residential counterparts, but commercial projects often demand more experience. Commercial HVAC outfits may also be unionized, which offers higher pay but also a higher barrier to entry. In commercial HVAC, one’s experience is the ultimate salary booster.
Residential HVAC systems are often smaller and simpler than their commercial counterparts. But working in residential HVAC is a much more customer-facing role and one that requires interpersonal skills. Unlike in commercial HVAC, residential HVAC professionals will often communicate directly with the customer, and negotiate services individually.
Starting with residential HVAC work can provide the fundamental understanding necessary to succeed in the commercial sector and it can also give one experience in some critical but less-taught areas such as customer relations, invoicing, scheduling, and team dynamics. Continuing education and optional certifications can help distinguish an HVAC professional within the competitive residential market.
Commercial HVAC systems are often larger and more complex than their commercial counterparts. While two residential buildings of the same size are likely to have similar HVAC needs, two commercial properties of a similar size may have completely different HVAC needs (i.e., a convention center versus a warehouse).
Going straight into commercial HVAC can be overwhelming, as one’s customers will often have been dealing with HVAC issues for a much longer period of time than in the residential sector. Higher stakes and higher complexity mean that work in commercial HVAC requires specialized education around particular systems and a dedication to continued professional learning.
|Licensure and Certification
While there is no federal requirement for residential HVAC technicians and contractors to obtain licensure and certification, several states do have such requirements. A list of each state’s professional licensing board can be found here.
Furthermore, optional certifications can distinguish a residential HVAC tech or contractor, and increase their likelihood of earning valuable projects.
Organizations which offer optional certifications, some of which have residential specializations for HVAC techs and contractors, include:
While there is no federal requirement for commercial HVAC technicians and contractors to obtain licensure and certification, several states do have such requirements. A list of each state’s professional licensing board can be found here.
Furthermore, optional certifications can distinguish a commercial HVAC tech or contractor, and increase their likelihood of earning valuable projects.
Organizations which offer optional certifications, some of which have commercial specializations for HVAC techs and contractors, include:
|The Bottom Line
Residential HVAC is a largely independent profession. Those working in residential HVAC will encounter relatively small and simple systems and interact with their customers on a regular basis. Average salaries can vary significantly based upon the sale or replacement of residential HVAC parts.
Success in residential HVAC often requires not only an expert understanding of residential HVAC systems but also skills in sales and customer relationships as well.
Commercial HVAC is a largely collaborative profession. Those working in commercial HVAC will encounter large and complex systems that can vary significantly from project to project. Average salaries are generally higher than in residential HVAC but negotiated in advance.
Success in commercial HVAC requires a specialized understanding of multiple types of HVAC systems and extensive previous experience is often a prerequisite.