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Read Introduction to 1 Peter


“you also, as living stones, are being built up a spiritual house, a holy priesthood, to offer up spiritual sacrifices acceptable to God through Jesus Christ.”


This verse begins a section dealing with the believer’s status before God.
you also, as living stones
The phrase “as living stones” identifies us with Christ. He is the “living Stone,” and we are “living stones.” We live because we share his resurrection life. Christ is the life (Jn 1:4; 5:25; 11:25; 14:6); we share in his life. The Christian life is not a religion but a vital relationship with God. God does not build his church out of dead materials. He builds it on our position before him in Christ.
Jesus is the Stone. Peter was a little stone (a chip) of the great rock Jesus Christ (Mt. 16:18).
are being built up a spiritual house
 “Built up” is literally to build a house. Peter uses this term in the metaphorical sense of edification. God is in the act of building believers in spiritual growth (Rom. 14:19; 15:2; 1 Cor. 14:3, 5, 12, 26). 
“Being” indicates that God does the building (Jude 20; Eph. 2:21,22). Nothing can hinder this building. God is in the process of laying each stone himself. 
“Spiritual house” refers to the church. God did not make this building out of literal stones. He builds this building by adding  Christians to the church. Every time a person receives Christ as their Savior, God places a new stone in the building. One day this building will be finished, then he will come again. 
The purpose of a house is for someone to live in it. God dwells in this house. God made his residency in the temple in the Old Testament. In the New Testament, he lives in Christians. He dwells in the lives of his people (I Cor. 6:19). He is a guest in our lives. 
Spiritual growth comes with the application of positional truth to experience.
God constructs the church based on positional truth. Our status before God is positional truth. Positional truth is true for both the spiritual and the carnal believer (I Cor. 1:2,30). Positional truth protects the believer from ultimate judgment (Rom. 8:1). Positional truth guarantees eternal life to those who possess it (Rom. 8:28,29).
God bases spiritual growth on positional truth. Have you edified your soul by God’s provision of positional truth? Have you applied your positional truth to experience? Do you realize that you have status in God’s eyes?