The Santiago Bernabeu outfit have been pursuing the Welshman throughout the summer, with Spurs chairman Daniel Levy holding out for a world-record fee of £100 million.
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"[Bale] is a wonderful player,” he told Al-Sadd's official website.
"I understand the Real Madrid board is working hard to assemble the best team possible. But the price is too high."
Raul also backed Carlo Ancelotti to make a real fight of the Liga title race this season after the club finished 15 points adrift of rivals Barcelona in 2012-13.
"Jose Mourinho did a very good job with the team, but Carlo Ancelotti is one of the best coaches in the world," said the 36-year-old.
"Barcelona has great players, so the two teams will push each other to the limits this year."