Manchester United are eyeing both Benzema and Ben Arfa, while Tottenham and Arsenal are among Premiership clubs keen on attacking midfielder Nasri.
"For those three players, it would be an error to leave for abroad now," said one-time France coach Houllier.
"Nasri, Ben Arfa and Benzema are being selected in the best French teams. They are therefore in the best conditions to develop their game, progress and make that step up.
"They must stay and get more confidence into their game, assert their qualities and achieve things."
He added in L'Equipe: "And leaving Ligue 1 shouldn't just be a question of money. You must be professional in your approach to leaving.
"Going abroad must be motivated by the desire to assert your potential, your play."