What is your location and what is the size of the house? Furnaces with efficiencies above 90% are very common these days. So much so the model choices below 90% have become limited.

The builder is saying I won't install the "house wrap" but it will won't cost you much more to heat a more draft house because I will install a more efficient furnace. The builder's logic is flawed and will only benefit him. I guess he has figured out installing a low end 96% efficiency furnace is cheaper than installing "house wrap".

Is he talking about house wrap (Tyvec), or exterior rigid insulation?

You want the best insulated construction possible and the most efficient equipment. This is especially true in a cold climate. Find out what the building code in your area requires for new construction for wall and attic insulation, and exactly what the builder is proposing.

Why not have an energy efficient envelope and an efficient HVAC system?

Ditto what others have said.

I'm not sure what "House wrap" is in this context - and I'm not sure you do either. There needs to be clarity about that.

In addition, as was mentioned earlier: We need to know what area of the country. Insulation can help summer and winter.

I think there are diminishing returns on furnaces much above 90-92% -except-- when those furnaces have an ECM blower. They usually go together though ECM blower and efficiency ~96%.

No way to answer without knowing what is being eliminated and it’s R value. And what is the cost credit for the wrap and cost extra for the furnace? Is it 1” rigid insulation?

it is easy to know the cost trade off if he used software to prove code compliance.

I much prefer zip sheathing to Tyvek on OSB

Is this even allowed in the codes. Here the codes are pretty strict on the total R value needed, and they seem to increase every year.

It is easier to change the furnace later than change the insulation later. Theoretically you could put in enough insulation where you would not need a furnace. Do both.

I don't know where you live but will add that insulation helps keep houses cool in the summer as well. So you and your builder shouldn't look at insulation as "just" a cold weather item.

We live in Alberta (lows of -40F to highs of around 90F), and my husband, who's a builder, just finished building our new house, where we did both -- extra insulation as well as efficient furnace. If I'm remembering correctly, we used batts of R20 (with R28 in the basement walls), R8 1.5" rigid insulation blanket over the entire house exterior, 2.5" rigid foam insulation under the concrete floor in the basement, and R50 batts and loose cellulose in the attic.

If the designer used trade off software instead if the prescribed code minimum R-values the more efficient furnace will allow less wall insulation. The prescriptive tables are used more by inexperienced owner-designers and for additions. The software measures simulated energy costs. It’s required in many places and the big builders use it for marketing.

Cant say more without knowing the climate but it appears to be a cold one.

"...house wrap insulation was obsolete since the furnace is so efficient."

What an idiot! Do you still have time to find a new builder?

I suspect the “ insulation wrap” being deleted might be Tyvek ThermaWrap LE which is a lowE metalized radiant barrier membrane of “equivalent” R value of 2 and is worthless in a wall unless it’s a brick veneer cavity wall but we don’t actually know what it is yet.

No reason to panic. If the OP wants to keep it he just has to pay for the higher efficiency furnace. We have no idea what the costs are so it’s impossible to advise him.

There is also Tyvek ThermaWrap 5.0 that is a 1.5” thick blanket wrapped in Tyvek that apparently fits in a cavity behind a masonry veneer or hollow sidings but I don’t know how.

It claims an R of 5.4

I live in Maryland, and I do not know what the R value is of the wrap. I do know it is a bubble wrap like material that is metallic on the outside and it literally looks like the outside of the home is wrapped in foil bubble wrap. It is referred to in the document as “reflective house wrap”.

Yes mike_home, you are right. All the other homes in the community have that insulation wrap and ours is the first ones they are trying to not put it on...I’m not signing anything yet.

It's just as likely that the builder has realized that the bubble wrap is worthless and a high efficiency furnace is a better "upgrade".

Might be worth a call to your utility company. Speak to one of their engineers. Good luck on your build.

What is the exterior cladding?

Bubble wrap is expensive and has little insulation value (R-1) and the foil requires an airspace to work and is ineffective In a well insulated wall. It’s basically a scam and the builder may be under pressure to stop false advertising

What is the R value of the insulation in the walls?

You deserve to see what they filed with the town. It should be available at the building dept. check it out.

When we built our home, the builder went to great lengths to educate us on insulation, window upgrades and HVAC decisions. My DH had it in his head that he wanted Geothermal HVAC. We decided to upgrade the insulation and windows. They are passive and you pay for them once. We ditched the geothermal because the payback was so far out in the future.

Additional insulation is always better than an "equivalent" efficient furnace. Insulation lasts longer than a furnace, works in the summer, and works when the power goes out. And if you think your gas furnace works when the power goes out, you are wrong most of the time.

Here is an article on bubble wrap. If the builder is proposing to eliminate a wrap that has a R1 insulation value and upgrade your furnace then that might be a fair trade in terms of financial value. The builder still needs to provide what the local building code requires for insulation. Ask him to explain how he will do this.

Anything is better than bubble wrap with foil that might contribute an R of 1 to a code compliant wall. And we don’t know what insulation is in the walls and roof.

The best part about bubble wrap is that the house won't be damaged in shipping.

With the very limited amount of information we can't re-design the house, insulation and HVAC - as much as we would all like to do that.

There is a lot more to consider than just thermal insulation value vs heat. How well sealed the walls are (ACH50) can be quite significant from a heating/cooling cost standpoint as well as comfort.

Preventing moisture and mold in the wall cavities is critical. How does the builder plan to manage that?

We ditched the geothermal because the payback was so far out in the future.

Like infinity? I'm a big fan of energy efficiency and alternative energy. When you add up the initial install, ongoing maintenance and power (yes, geo uses a fair bit of electricity to do its thing) and compare that against realistic energy produced and savings over traditional HVAC it might prove impossible to determine a payback period.

opaone, If there was ever any problem with one of the components in the mechanical systems of a geothermal setup, we would be pushing the payback even further. We went with the passive and paid for once system of great insulation and excellent windows.

The builder stated he will still install a Tyvec wrap product as the moisture barrier.

"The builder stated he will still install a Tyvec wrap product as the moisture barrier."

Yikes!! If that is what the builder said verbatim and believes that, you may want to look for another builder......................

In theory, Tyvek HomeWrap is an air and weather barrier that allows moisture vapor to pass through it. Builders sometimes adopt their own terminology.

It would help to know the design of the wall system but I doubt it will have an impact on the tradeoff between bubble wrap and a high efficiency furnace so you should take it.

If you want us to judge the adequacy of the insulation in the wall and roof you should tell what they are but if they meet the local building code, they should be OK.

Will the home be Energy Star certified? Will there be a blower door test? Will there be a ventilation air system?

if they meet the local building code, they should be OK.

I don't think so. We've tens of thousands of homes that met local building codes but stucco is falling off of due to trapped moisture. Building code in many states still allows for two vapor barriers that result in trapped moisture and mold buildup. Calculations for joist/truss spans are quite inadequate in many jurisdictions. Most states' energy efficiency requirements for insulation, thermal bridging and air changes are decades behind those of other developed nations. U.S. building codes still allow use of toxic chemicals that have long been banned elsewhere due to the negative health effects on occupants. Makeup air requirements are wholly inadequate in most states and I don't believe any even mention ACH50 calculations for MUA design.

And then layer on top of this that the average building inspector in the U.S. is completely clueless so many homes don't even meet our rather poor building codes.

I think is misspoke by calling Tyvec wrap a moisture barrier. This is how DuPont describes it:

DuPont™ Tyvek® HomeWrap® is the original house wrap, incorporating unique material science that helps keep air and water out, while letting water vapor escape.

Opaone, I was only referring to the wall and roof insulation; i'm not trying to design the house and deficiencies in US building codes is entirely off topic.

The 2015 IECC is not decades behind other developed nations. The prescriptive minimum insulation for Maryland is currently R20 (or 13+5) for walls and R49 for roof/ceilings so the OP is not in much danger of having a poorly insulated house even if the builder used another method of complying with the code.

Furthermore, if the OP was concerned about the amount of insulation, he would have described the wall design but he has ignored repeated requests to do that so its time to make a recommendation about the furnace trade-off and let it go.

In addition to insulating, you should do air sealing. Then you will reduce the amount of energy needed to heat and cool your home. Here is a guide from the U. S. Dept. of Energy that explains air sealing:
https://www.energy.gov/energysaver/weatherize/air-sealing-your-home