QPR boss Redknapp was in charge at West Ham when Ferdinand made his England debut in 1997 and the 34-year-old went on to make 80 more appearances for his country while playing for Leeds and at Old Trafford.
"We knew from day one he was going to be a special player," Redknapp told talkSPORT. "He was lightning quick and graceful on the ball. He had everything."
Redknapp added: "I loaned him to Bournemouth and Man United came in. (Chairman) Martin Edwards rang Bournemouth football club, he rang Mel Machin who was the manager and asked Mel how much he wanted for the young centre-half.
"They'd seen him play on the Saturday at Rochdale or somewhere and Mel said 'well he's only on loan, he belongs to West Ham'. Martin Edwards didn't realise that.
"He came on and wanted to buy him and I said 'he hasn't got a price, he'll be the best defender in Europe one day'. Eventually he ended up at Man United but for an awful lot of money."
Ferdinand has cited a desire to focus on his club career as one of the reasons for his decision to exit the international stage and Redknapp believes he still has a lot to offer to incoming United boss David Moyes.
"People say he has lost his pace," he added. "Well he may have lost a yard but he is still as quick as anybody because he was so quick (to begin with).
"I'm sure he will do a great job for David if he sees him in his plans at Old Trafford."
Ferdinand confirmed his decision on Wednesday morning, the day before Roy Hodgson is due to name his England squad for the friendlies against Republic of Ireland and Brazil.
Source: PA
Source: PA