The Wales manager spoke to the press on the eve of their friendly with Panama, which Bale will miss because of yet another injury setback.
Real Madrid are reportedly fed up of the Welsh forward's continuous injury problems and have decided to cash-in on him, with a trio of Premier League clubs are said to be interested in bringing him back to England.
However, Coleman believes Bale would be better off staying in Spain rather than facing the unforgiving nature of the Premier League.
"I'd like to see Gareth wherever he's going to be happy," said Coleman.
"If I'm going to be the Welsh manager for two more years, or four more years, I'd like to see him stay at Real Madrid.
"Okay, he's picked up a lot of injuries but generally the Premier League is much tougher than La Liga in terms of the physicality. It's very tough the Premier League.
"When he's happy he plays good football. When he comes to us and he's happy and we see an amazing player.
"If he's happy in Madrid fine. If not he should go and play somewhere where he is happy."
Bale has played just nine games in all competitions this season, and after facing another month on the sidelines with a strained adductor muscle, Coleman has sympathy for the 28-year-old.
"Sometimes the harder you work to get back the longer it takes for you to get back because you pick up niggles. He's finding that out now, Bale.
"It's a shame really he'll be a loss for them (Real Madrid) and we need him now also. We're always a stronger force when you have someone like that in your ranks."