Most Minnesota homeowners are familiar with split-system HVAC — the furnace in the basement, the AC condensing unit outside, connected by refrigerant lines and ductwork. But there's another option that gets far less attention: the package unit. All the heating and cooling equipment in one outdoor box. No indoor air handler. No basement furnace.
For certain homes, package units are a genuinely better fit. This guide explains what they are, how they work, whether they make sense in a cold climate like Minnesota, and what Goodman package units cost from a factory-direct supplier like Furnace Direct.
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What Is a Package Unit?
A package unit combines all major HVAC components into a single outdoor cabinet: heat exchanger or heat pump, evaporator coil, condenser coil, blower motor, and controls. Instead of separate indoor and outdoor units connected by refrigerant lines, everything is in one box mounted outside the home on a roof curb or concrete pad. The unit connects directly to your home's ductwork through two openings in the exterior wall or roof.
Types of Package Units
Gas/Electric Package Unit: Heats with natural gas and cools with a standard refrigerant cycle — the most common choice for Minnesota because it handles extreme cold reliably. Heat Pump Package Unit: Heats and cools using the refrigerant cycle only, more efficient in mild weather but performance drops significantly below 20–25°F. Dual Fuel Package Unit: Combines a heat pump with a gas furnace — runs on heat pump efficiency in moderate temps, switches to gas in extreme cold. Electric Package Unit: Heats with electric resistance strips — not recommended for Minnesota winters due to very high operating costs.
When Does a Package Unit Make Sense?
Package units aren't for every home, but they're the right call in specific situations. Homes without a basement or mechanical room — slab-on-grade and manufactured homes often have no interior space for a furnace. Homes that already have a package unit installed — replacing like-for-like is simpler than converting to a split system. Homes with exterior ductwork configurations. Commercial and light commercial applications with rooftop curbs.
Do Package Units Work in Minnesota Winters?
Yes — gas/electric package units work well in Minnesota. The gas furnace section operates the same as a standard forced-air furnace regardless of outdoor temperature. Cold weather affects only the cooling side, and you're not running AC in January. One consideration: units sit outside year-round and must withstand -20°F winters. Quality matters — Goodman builds their package units to the same specs as their split-system components.
Package Unit vs. Split System
| Factor | Package Unit | Split System |
|---|---|---|
| Interior space required | None | Mechanical room / basement |
| Cold weather heating | Excellent (gas/electric) | Excellent (gas furnace) |
| Max efficiency available | Up to ~80% AFUE / 16 SEER | Up to 98% AFUE / 21+ SEER |
| Contractor familiarity | Less common | Most common |
For most Minnesota homeowners with a basement, a split system offers better efficiency and more contractor familiarity. But if your home is slab-built or already has a package unit, replacement with a like-for-like package unit is often the right call.
Get Package Unit Pricing from Furnace Direct
Furnace Direct sells Goodman package units at factory-direct wholesale pricing. Browse our full catalog at furnace.direct/collections/heating or furnace.direct/collections/cooling.
Related reading: Goodman Furnace Model Comparison | Goodman AC Models Compared | How to Size Central AC in Minnesota
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