In this study, alternative heat pump systems are compared for use in South African climatic conditions. Monthly heating/cooling capacities and coefficients of performance for air-source and vertical and horizontal ground-source systems are calculated. The desired type of heat exchanger is determined by considering economic factors, such as the total costs, comprised of the capital and operating costs. The cost-effectiveness on investments of each system is calculated, with parameters, such as the payback period, net present value and internal rate of return. It is concluded that the horizontal ground-source heat exchanger offers the maximum economic viability.