Perth came top of the Royal Bank of Scotland's index

A Royal Bank of Scotland (RBS) report said it served up big city living - but with house prices below the national average of �160,000.

Inverness, which was highlighted for its museums and high number of award-winning restaurants, came second on the list, with Livingston in third.

It is the first time RBS has compiled an affordable affluence index.

The bank said Edinburgh, Glasgow and Aberdeen would have come out on top for their range of shops, restaurants and attractions.

TOP FIVE CITIES AND TOWNS Perth Inverness Livingston Dunfermline Kilmarnock

However, it used house prices to gauge affordability.

RBS picked Inverness, second behind Perth on the index, as an example.

It said the Highland city's close proximity to Loch Ness - and offerings of a "wealth of shops and popular entertainment", as well as the more "culturally satisfying museums and scenery" - helped to put it so high on the list.

The bank said the average income in Inverness was �32,000, while the average house price was �160,000.

However, this figure dropped to �146,000 when the upmarket IV1 postcode was excluded.

Quality of life

Perth's council leader welcomed the findings of the survey and said it reflected the town's "strong reputation as a vibrant community".

Councillor Ian Miller said: "Our cultural and arts provision is going from strength to strength, our city centre offers a wealth of shopping and dining experiences and we have leisure facilities to suit all tastes and all age groups.

"Our success is indicated by the fact that we are one of the few areas in Scotland that is expected to see an increase in population over the next 10 years.

"This is not just because of our quality of life but also because people are attracted to a location that is fairly central in Scotland with good transport links with the rest of the country."

He added: "We are determined to ensure that this success continues and that Perth is recognised as the most dynamic and best small city in Scotland."