The construction industry is the largest contributor to global CO2 emissions, yet the successful adoption of circular construction materials heavily depends on their evaluation by the public. Often, however, consumers lack readily available information on which they can base their decisions. The current study examines how providing information about recycled aggregate concrete (RAC), a new and sustainable construction material, via a Digital Product Passport (DPP) influences the perception and decision-making of potential consumers. A scenario-based vignette experiment (n = 82) was conducted for the use case of a concrete stairway element. The effects of type of concrete aggregates (recycled vs. natural), environmental impact (high vs. low) and durability (high vs. low) on perceived environmental value, perceived functional risk, willingness to pay and product preference were examined. Results showed that all three characteristics significantly affected willingness to pay and product preference. A lower environmental impact increased the perceived environmental value and a higher durability decreased perceived risk. Interestingly, the mere labelling of a material as recycled also impacted environmental value and risk perceptions, regardless of the objective environmental and durability characteristics. The findings reveal that consumer decision-making is influenced not only by objective material characteristics but also by biases in information processing, including exaggerated perceptions of environmental benefits and functional risks for recycled material. These insights highlight the importance of addressing cognitive biases and optimizing information presentation in DPPs to enhance informed decision-making and acceptance of sustainable innovations.