Outdoor woodstoves are usually placed from 30 to 300 feet from the home, with 500 feet the maximum. Placing furnaces as close as 3 feet from the house increases smoke nuisance--and the associated health risks--as well as fire risk, but makes it possible to heat the air in the home directly rather than piping in heated water. This improves combustion efficiency and emissions. Gasification models reduce smoke and are suitable closer to the house.
Convenience and Cost
Greater distance increases the unpleasantness of stoking the furnace in bad weather. It increases installation costs since you need longer pipe work and trenches. Distant furnaces must use the hot water method--meaning they burn inefficiently and are smoky. Consider smoke drift towards neighbors and highways.
Consult the manufacturer’s installation manual for recommended distances. Consider cost, convenience and the location of any other buildings that are to be heated. For environmental reasons, position an exterior woodstove as close to your house as is practical and use a gasification model. Check local and federal fire regulations and building codes and never place it closer than 3 feet.