Spurs travel to the Etihad Stadium to face City on Saturday, with Manuel Pellegrini’s men having won all five of their home league games so far this season.
And, despite an away record that has seen them lose at Cardiff, Aston Villa, Chelsea and Sunderland, Vertonghen insists City are still title favourites.
"City, I think, is the best team in the league," he told Sky Sports News. "Arsenal are doing very well, of course. But, especially in home games, City is the team to beat.
"It's really crazy. I think if we'd won against Newcastle, we'd be joint second now - but we're seventh.
"It's unbelievable how we play City and United next. It's very hard this year. [Vincent] Kompany already said it will be the toughest league in years to finish top. We have to be at our best to finish in the top four."
Vertonghen also expressed his view on a clash between two of his team-mates – Romelu Lukaku, who he plays alongside at Belgium, and Hugo Lloris, his team-mate at Spurs.
The duo collided during Tottenham’s visit to Everton recently, with Lloris consequently suffering from concussion, but Vertonghen insists Lukaku did not intentionally hurt the France goalkeeper.
"He's not like that," said the Belgium defender. "We spoke to him. I know he didn't mean to, he's a very kind guy.
"I hope everything's OK with Hugo now."
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