SUMMARYSeismic behavior of damaged buildings may be expressed as a function of their REsidual Capacity (REC), which is a measure of seismic capacity, reduced by damage. REC can be interpreted as the median value of collapse vulnerability curves. Its variation owing to damage is a useful indication of increased building vulnerability. REC reduction, indicating the lowering of seismic safety after an earthquake (performance loss, PL), represents an effective index for assessing the need of seismic repair/strengthening after earthquakes. The study investigates the applicability of a pushover‐based method in the analysis of damaged structures for the case of existing under‐designed RC buildings. The paper presents a systematization of the procedure in an assessment framework that applies the capacity spectrum method based on inelastic demand spectra; furthermore, the vulnerability variation of a real building is investigated with a detailed case study. The behavior of damaged buildings is simulated with pushover analysis through suitable modification of plastic hinges (in terms of stiffness, strength and residual drift) for damaged elements. The modification of plastic hinges has been calibrated in tests on nonconforming columns. The case study analysis evidenced that, for minor or moderate damages, the original structural displacement capacity was only slightly influenced, but the ductility capacity was significantly reduced (up to 40%) because of the increased structure deformability. This implied performance loss in the range 10%–20%. For severe damages the PL ranged between 41% and 56%. Local mechanism types exhibit PL nearly double with respect to global mechanism types. Copyright © 2012 John Wiley & Sons, Ltd.