1) "Ye also, as lively stones," (Gk. Kai autoi) also or even yourselves - as Jesus Christ is "the Stone" (foundation one) in salvation, supplying the water of life, the foundation for a worthwhile life, the Foundation of the church - the pillar and ground of the truth, even so those saved (in Him) are declared by Peter to be "living stones." 1 Timothy 3:15-16.
2) "Are built up a Spiritual house." (Gk. oikomeisthe) means are progressively being built up." Strengthened or embellished (Gk. oikos pneumatikos) an house spiritual in nature. The church of Jesus Christ is made of "lively stones" "fitly framed together" on the New Testament pattern.
a) saved baptized disciples Matthew 4:19-21.
b) covenanted together to follow Jesus in His program of worship and work. Mark 8:34-36; Ephesians 2:19-20.
3) "An holy Priesthood." (eis hierateuma hagion) “unto” that is built or fitly framed or covenanted together as lively stones with view to a holy priesthood work - as the Old Testament priesthood administered a program of Divine work and worship even so - not all the family of God - not all the saved - not all believers, but those "fitly framed, formed," or covenanted together to carry on the worship and work of Jesus constitute His Holy priesthood in the Gentile age. Ephesians 4:16. This is the church.
4) "To offer up Spiritual sacrifices" These sacrifices are to be of the whole body, mind, and talents in service, prayer, praise, thanksgiving, witnessing, and testimony to the Lord -- through the church. Romans 12:1-2; Philippians 4:18; Colossians 3:12-17.
5) "Acceptable to God by Jesus Christ." To be well received by Jesus Christ every redeemed person must seek and find fitly framed fellowship in the church of Jesus Christ, a local congregation. Here only may a lively stone render the greatest degree of service to Jesus. Matthew 28:18-20; Ephesians 3:21.
STONES LEFT UNUSED
Travelers sometimes find in lonely quarries, long abandoned, or once worked by a vanished race, great blocks, squared and dressed, that seem to have been meant for palace or shrine. But there they lie, neglected and forgotten, and the building for which they were hewn has been reared without them. Beware lest God’s grand temple should be built without you, and you be left to desolation and decay.
--A. MacLaren