Australian Securities and Investments Commission chief economist Alex Erskine says the oversight of the housing market by the securities regulator is the "next logical step'', arguing that this would increase transparency while lowering sharp distortions in home prices.

Mr Erskine said the housing market should run on principles similar to those of equities, which would also allow for the rise of products that could help consumers to hedge house price risk as they can in sharemarkets, according to a Fairfax Media report.

He said that while the housing market was central to the recent global financial crunch, the market-based thinking of most securities regulators meant there was little incentive ''to look beyond their legal mandates to the housing and housing finance sector''.

The securities regulator emphasised that Mr Erskine's proposal were his personal views although, given the context of an economic assessment of the global financial crisis, they were likely to start discussion about the expanding role of ASIC.

While the work of real estate agents mostly falls under state-based agencies, the comments imply ASIC also sees itself as playing a wider role in the area.
''The housing market played a key part in the financial and economic boom and bust,'' Mr Erskine said.

''It seems set to continue to pose an acute challenge in the recovery period, with concerns over price bubbles and excessive borrowing and speculation in some economies and the consequences of previous excesses still washing through other economies.

''Housing appears too important to be regulated on its current typically severely fragmented basis.''