In its basic sense, οἰκοδομέω (οἰκοδομῶ) means “to build,” especially a house.1
Hence, in the New Testament, the verb is used in reference to a man building a house,2 a tower,3 the tombs of the prophets,4 the temple,5 and a synagogue6—all structures.
The verb is also used metaphorically (figuratively) in the sense of “to build up, edify (e.g., a person).”7 According to Oxford English Dictionary, the verb “edify” when used figuratively means,8
This sense is metaphorical (figurative) because the verb literally means to build a structure.
With respect to your question,
Which of the two interpretations should be retained?
The verb can be used literally or metaphorically, and its meaning is determined according to the context. If the context describes the edification of a structure, then the reader can assume it is the literal sense. If, on the other hand, it is describing the edification of a person, then it is the metaphorical sense.
There is one other meaning that I would like to discuss. In the New Testament, the verb οἰκοδομέω is also used in a context where people themselves are built (οἰκοδομέω) into a structure. This structure, the Church, unlike the structures discussed before, is not composed of tangible materials, such as brick, wood, stone, etc.
The apostle Peter wrote,9
5 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. NKJV, ©1982
Is this sense literal or metaphorical (figurative)? Thayer seems to lump this verse in with the other verses that clearly use οἰκοδομέω in a figurative sense.10 On the other hand, BDAG does not explicitly state that this use is figurative. Rather, it states that it is used by the author with the meaning of “to construct in a transcendent sense.”11 My opinion is that it is being used in 1 Pet. 2:5 in a literal sense, as the author is describing a structure being built. The difference here is that this structure is a spiritual structure, rather than a physical structure. However, this does not preclude a literal meaning.12
1 LSJ, p. 1294, οἰκοδομέω, 1.
2 Matt. 7:24, 7:26 // Luke 6:48–49
3 Matt. 21:33 // Mark 12:1; Luke 14:28
4 Matt. 23:29 // Luke 11:47–48
5 Matt. 26:61, 27:40 // Mark 14:58, 15:29; John 2:20; Acts 7:47, 7:49
6 Luke 7:5
7 Acts 9:31; 1 Cor. 8:1, 10:23, 14:17; 1 Thes. 5:11
8 OED online, edify (v.), 2., c.
9 1 Pet. 2:5
10 Thayer, p. 440, οἰκοδομέω, β., b.
11 BDAG, p. 696, οἰκοδομέω, 2.
12 As an analogy, I refer to the use of “born again” in John 3:3. Did Jesus mean it literally or metaphorically (figuratively)? He meant it literally, but the second birth is spiritual rather than physical. Likewise, the house built here is a spiritual one, and yet, the verb οἰκοδομέω is still being used in its literal sense, “to build” (a structure).
Arndt, William; Bauer, Walter; Danker, Frederick William. A Greek-English Lexicon of the New Testament and Other Early Christian Literature. 3rd ed. Chicago: U of Chicago P, 2000.
Liddell, Henry George; Scott, Robert; et al. A Greek-English Lexicon. 9th ed. with revised supplement. Oxford: Clarendon, 1996.
Wilke, Christian Gottlob. A Greek-English Lexicon of the New Testament: Being Grimm Wilke’s Clavis Novi Testamenti. Trans. Thayer, Joseph Henry. Ed. Grimm, Carl Ludwig Wilibald. Rev. ed. New York: American Book, 1889.