<p>The construction industry is a significant contributor to climate change, exacerbating emissions and landfill waste in a world that has already exceeded the 1.5 °C threshold. In response, circular economy models and regenerative bio-based building materials have emerged as promising solutions. While bio-based materials align with the principles of the Bioeconomy, their integration into circular economy systems remains limited and underdeveloped, with recent studies failing to adequately identify and address key gaps. This paper employs a semi-systematic review methodology to critically examine all stages of the circular economy model for bio-based materials, categorized into early stages (sourcing, material design, and production) and end-of-life stages (collection and recycling). The review identifies 22 barriers and research gaps, which significantly affect end-of-life planning, collection infrastructure, and binder compatibility for recycling. A six-criteria framework for circular material design and selection is proposed. Non-wood materials such as bamboo, mycelium, and fiber-reinforced earth composites are identified as particularly promising, and the combined use of wood and non-wood bio-based materials is recommended to mitigate biodiversity loss and enhance resilience. Additionally, the study introduces a for-profit centralized intermediary hub model to coordinate the currently fragmented bio-based material markets by facilitating design decisions, supply chain integration, amid policy implementation. This review is the first to present a comprehensive circularity gap analysis, a circularity-focused material design framework, and a strategic intermediary model for bio-based construction materials, offering critical insights and actionable pathways for policymakers and industry stakeholders to support their mainstream adoption.</p> Graphical Abstract <p></p>