A bottom-up dynamic modeling framework aiming to incorporate realities of the decision-making process when implementing energy-saving building renovations is proposed and applied to a case study of all multifamily buildings in Gothenburg, Sweden. The developed model is based on real conditions of existing buildings, from the national Energy Performance Certificate database, building and property registers, and cadastral maps from the city planning office. Although explorative, the framework accounts for the reaction capacity in terms of (i) investments by all property owners and (ii) total workmanship capacity in the city. Two scenarios were considered to account for renovations driven solely by technical renovation needs (end-of-life of building components) and by cost efficiency; further, both scenarios were investigated at different levels of reaction capacity. The developed framework is easily replicable to other regions and cities. The retrofitting includes, as individual measures as well as in packages, increased insulation levels, increased efficiency of lighting and appliances, and the installation of heat recovery systems and photovoltaic panels. Whereas implementation of energy-efficient measures dictated solely by technical renovation needs led to a very low energy demand, with some buildings becoming energy producers by 2050, implementation strictly driven by cost-efficiency (from the perspective of the property owners) only reduced the energy demand by 5% during this time and would not fully utilize the investment capacity of the property owners. Furthermore, the current limitations of reaction capacity for the market shares allowed for a reduction of the energy demand by only 15% during the same period. Workmanship capacity was more constraining than investment capacity and is thus identified as a local imperative need and suggests cobenefits related to job creation within the construction sector.