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10. (Tied) Bern, Switzerland

Bern, the capital of Switzerland, fell one spot this year to tie with Sydney at No. 10 after coming in 9th in the quality of living survey for the previous four years.

Located in the Swiss plateau, Bern has been able to maintain its medieval charm. In 1983, its city center known as the old town of Bern became a UNESCO World Heritage Site. Often ranked among the most expensive cities in the world, Bern is the center of Swiss engineering and manufacturing with medical, information technology, automotive, and luxury products such as watches made there.

Last year it was ranked as the second safest city to live in the world after Luxembourg, according to Mercer's survey. Switzerland's reputation as the traditional banking safe haven for the world's wealthy has made it an attractive place for relocation. However, growing immigration has become a major cause of concern for locals who fear that an inflow of foreigners is threatening the Alpine's country's high standard of living. In November, a Swiss environmentalist group presented the government with 120,000 signatures to force a referendum on immigration by calling for an annual limit on the country's population growth via immigration to 0.2 percent. The Swiss population hit the 8 million mark this year – an 18.5 percent rise from 1990.

Izzet Keribar | Getty Images