The Real Madrid legend believes the club would be better off abandoning its pursuit of the Tottenham star and feels the title battle will be fierce in La Liga this season.
Los Blancos have long been pursuing the Spurs star this summer, with reports suggesting a bid of 120 million euros would be required to prise the Welshman away from White Hart Lane.
Raul, however, believes such a figure is too pricey, even for a player of the 24-year-old's talents.
“[Bale] is a wonderful player,” Raul told the Al-Sadd 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 archrival 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," the 36-year-old Raul said. “Barcelona has great players, so the two teams will push each other to the limits this year.”