But, I'm convinced that Christ was preaching the Gospel throughout the Sermon on the Mount (Matt 5-7). It is certainly good news to say, “Keep these laws to be rid of the miseries that come from sin and to enjoy the blessing of God!” “Obey and you will be blessed with the enjoyment and happiness that comes from the possession of eternal life!” The law of Christ is not bad news for the believer who is already justified. If it is not bad news, and if it teaches us the way to enjoy our relationship with Christ, then it must be good news!
It's important to remember that "the instructions for sanctification" aspect of the Gospel only comes after the announcement of what God alone has already done to redeem His people. The heart of the gospel is, “Christ has completely satisfied the law for His people! He paid the penalty and earned the blessing! Just look to Him in faith and you will have a right and title to eternal life!”
But, the whole gospel message is more than simply an announcement of what God has done in Christ by the Spirit to overcome the effects of sin. It also includes the good news of what we can and must do to enjoy His purchase.
The gospel involves all three of Christ’s offices: He is our prophet (herald); He is our priest (justification); but He is most certainly also our king (sanctification).
I highly encourage you to read Ryle's paper.
HT: James Grant