Economic Assessment of Building Adaptation to Climate Change: A Systematic Review of Cost Evaluation Methods

Climate change is intensifying the frequency and severity of extreme weather events, threatening the resilience of buildings and urban infrastructure. While technical solutions for climate adaptation in buildings are well documented, their economic viability remains a critical, yet underexplored, dimension of decision-making. This novel systematic review analyzes publications with an exclusive focus on climate adaptation strategies for buildings using cost-based evaluation methods. This review categorises the literature into three methodological clusters: Cost–Benefit Analysis (CBA), Life Cycle Costing (LCC), and alternative methods including artificial intelligence, simulation, and multi-criteria approaches. CBA emerges as the most frequently used and versatile tool, often applied to evaluate micro-scale flood protection and nature-based solutions. LCC is valuable for assessing long-term investment efficiency, particularly in retrofit strategies targeting energy and thermal performance. Advanced methods, such as genetic algorithms and AI-driven models, are gaining traction but face challenges in data availability and transparency. Most studies focus on residential buildings and flood-related hazards, with a growing interest in heatwaves, wildfires, and compound risk scenarios. Despite methodological advancements, challenges persist—including uncertainties in climate projections, valuation of non-market benefits, and limited cost data. This review highlights the need for integrated frameworks that combine economic, environmental, and social metrics, and emphasises the importance of stakeholder-inclusive, context-sensitive decision-making. Ultimately, aligning building adaptation with financial feasibility and long-term sustainability is achievable through improved data quality, flexible methodologies, and supportive policy instruments.