Friedel, who turns 40 next May, has been a consistent performer for Villa since joining from Blackburn Rovers in 2008 and is close to making his 100th appearance for the club.
Villa boss Houllier, who sold Friedel to Blackburn during his time in charge at Liverpool, has praised the American's contribution to the club.
And, while he believes it is premature to discuss a contract extension, Houllier confirmed he does want Friedel to stay at Villa Park.
"I think it's too early to speak about that, but definitely yes (in terms of staying)," said Houllier.
"At the moment, he's doing a good job, a very good job. He's very professional.
"With a player after the age of 30, you need to sometimes take into consideration certain things.
"When you have the opportunity to rest them, do it. But he's a good professional.
"He has always been like that. Everywhere he went I have never heard anything against him in terms of dedication, commitment, preparation.
"The boys like him as well."
Source: Team Talk