How to Create Your Own Fake Town

So one of the things I'm a fan of in novels is the "fake town."  Also known as the "fictional city," the "imaginary inlet," or the "hypothetical hot spot."  Or maybe I'm the only one who thinks of them like that?  Ahem.  Okay, moving on.

So what's the point of crafting your own town to set the story in, versus using an established city.   I think the main benefit is the ease with which you can write.  If you use an established city, then you're expected to do more research.  But if you create...