"Replacement Theology" turns the word "Israel" into a dual-purpose word, retaining its literal meaning "Israel" as a natural people, but simultaneously turning it into an allegorized term denoting a "spiritual people."
I think you are mischaracterizing a few things here, and misrerpresenting the biblical theology of those you falsely call "Replacement Theologists".
Firstly there is no such thing as "Replacement Theology". It's a made-up term used by those who
replace the seed of Abraham who inherit God's covenant with Abraham and God's promise that He will be God to Abraham and his seed forever,
who are Jews in Christ through faith in Christ +
Gentiles in Christ through the same faith who are grafted into the Olive tree,
with
unbelieving Jews who have been broken off from the Abrahamic Covenant through their unbelief,
and calling those broken off Jews "God's elect".
Unbelievers -
whether Jews or Gentiles - do not inherit the promises which belong to the seed of Abraham who are all in Christ through faith in Him.
Secondly, those who have faith in Christ
are indeed a 'spiritual house':
Ephesians 4
3 endeavoring to keep the
unity of the Spirit in the bond of peace.
4 There is one body and
one Spirit, even as you are called in one hope of your calling,
5 one Lord, one faith, one baptism,
6 one God and Father of all,
who is above all and through all and in you all.
There is no basis for inserting this process of allegorization,
There's no allegorization. It's reality.
The Holy Spirit dwells in those who are in Christ, and they live - each one - in a physical body. Using words like 'allegorization' in this context is a complete
misrepresentation of reaility. It's only used by those who invented the phrase "Replacement Theology", who in fact are the only ones who adhere to replacement theology - by replacing Jews who believe in Jesus + Gentiles who believe in Jesus, who inherit the Abrahamic covenant, with Jews who are broken off from the Abrahamic Covenant through their unbelief, and are therefore no more among
the elect seed of Abraham than the millions of Gentiles who do not believe.
Paul does not allegorize "Israel" by redefining it as the International Church.
This is a misrepresentation of scripture and of Paul's teaching. Paul taught very clearly that since Jews and Gentiles in Christ are the elect group among the Israelites who are indwelt by the Holy Spirit, they are the living stones who together make up the Tabernacle of God, which is a.k.a the church.
It stands to reason therefore in an equation as simple and logical as 1+1=2, that the church = the elect, a.k.a Israel, and Israel = the church. The obsession with trying to prove this fact "false" is a hopeless endeavor. It will always be a fact.
He only defines the nation as an ideal which is an ages-long process that requires a long time to arrive at. Many are delegitimized not because they have ceased to be Israelis, but only because they have ceased to belong to a nation from which they have religiously departed.
The Jewish descendants of Abraham who were born natural descendants of Abraham are not deligitimzed from belonging to their own Jewish nation - whether Christians or not. And Jews are natural descendants of Israel.
They remain Jews, but unbelieving Jews, according to scripture, have been broken off from the elect group among the nation (not ALL born of Israel are Israel, as Paul taught), and this is because as long as they reject the seed of Abraham (Christ), they are broken off from the covenant of God with Abraham and its promises, and therefore, they are broken off from the elect group among the Israelites.
"Israelis" isn't the correct term to use, because Israel is a country and the word "Israeli" refers to a citizen of Israel.
You can be an Arab or a non-Jewish secular person whose family had lived in Israel for generations before 1948, and be an Israeli. Indeed, not all Israelis are Jews. It's important we get our terminology right. Biblical descendants of Israel are Israelites.
Jews are all Israelites by birth, but not all Jews are Israelis (citizens of the country called Israel).
As far as the biblical elect Israelites are concerned, the elect nation whose election is based upon God's promise to Abraham, has always continued even after the seed of Abraham, who is Christ, came and died and rose again, and the elect nation continued through the believing Jewish remnant, and Gentiles who believe are grafted in among the remnant. But the rest of the Jews who are not in Christ are broken off from the elect group among the nation descended from Israel, because they are broken off from the Abrahamic Covenant and its promises.
This is the case whether or not Jews are in exile.