What does it mean that believers are a heavenly people?
The context presents believers as a heavenly people because they are placed into the body of Christ and given heavenly citizenship, distinct from Israel, which will enjoy an earthly domain on the new earth. As members of the Body of Christ, they are destined to rule and reign with places of responsibility throughout God's recreated universe.
Les explains that salvation is the act of God that takes us out of darkness and eternal doom and places us under His righteousness, covering us, putting our feet on the rock, giving us the lamp unto our pathway, writing our names in the Lamb's Book of Life, and placing us into the body of Christ. From that position, believers are a people with heavenly citizenship, headed for a glorious eternity. Les contrasts this with Israel, which will enjoy their earthly domain on the new earth, while the Body of Christ is a heavenly people. He suggests that in the eternal state believers will rule and reign in the whole new universe God brings about and have places of responsibility out there, where time and distance mean nothing.