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It is hard to determine a "best" city, because so much is contingent on your lifestyle, your preferences, your work, etc. To me there are several cities and towns in which life could be good or else, horrible, depending upon a wide array of factors, ranging all the way from income to weather preferences to personality.  I live in the capital city and have adapted very well and enjoy it greatly.  I understand, however, that the urban lifestyle is not for everybody, especially with the hellish traffic that characterizes the city.  Nevertheless, I have ready access to many of the US products that I am used to in the supermarkets, Pricemart, Walmart, etc., and the countryside is not far away.  I teach in a couple of private universities and it is a short drive for me. I like the energy of the city myself. Always have, never been a great lover of suburbia. Currently I live in Zone 10 and often spend  time in zone 1 (the historic downtown).  I am close to the private hospitals that my health insurance covers, and that is important to my husband and me. I also like to be close to the zoo and the Children's Museum for when I have family visiting from the US. On the other hand, I have friends who live in Antigua, Panajachel, and even Xela, and they all like it very much and would not want to live in the city.  I would not mind living in Xela or Antigua, and we do spend a couple weekends a year there. Yet life in rural cities is bit too "paced" and slow for me, but like I said, it is all a matter of personal choice.

I think that "the best city lo live in" relies heavily on the interests, goals and activities of the person. If we pay so much attention to environment (quality of air, noise, trash, etc.) I don't think Guatemala city or Villa Nueva or Amatitlan will be a good choice.

But if you work in Guatemala city, there's no question that the best option is to live in the city, maybe in areas or zones as close as possible to your job (could be zones 1,4,9,10, 13 and 14) that way you'll avoiding long and complicated traffic jams.

Now, if you work in the city and have flexible hours or you are a freelance, then you can choose places like San Lucas, Santa Lucia Milpas Altas, Antigua and some surrounding towns (Ciudad Vieja, San Pedro Huerta, Jocotenango, etc.)

If you really have the flexibility, try to avoid Guatemala City and surroundings towns like: Villa Nueva, Boca del Monte, Villa Canales, Amatitlan, Barcenas, Carretera a El Salvador.

If I would have that flexibility, my first pick will be Antigua Guatemala, then surroundings towns. Now, if you don't really need to work (like you are a retired or have your own business) you can even choose places like Tecpan and pretty much most of towns on the highlands.