Here's someone looking to follow the Craigslist model in the UK market for classified ads. It's My Market offering free ads in local markets across the country.
Sounds like an excellent idea actually. The cornerstone of the local newspaper industry has always been the classifieds and as has been shown in the US by taking those online you can get a lot more advertisers, a lot more readers, and thus a much more liquid market. This in turn means much better prices for the sellers and a much larger pool of available goods for the buyers.
Once these markets get going they tend to be self-reinforcing, which also helps the first movers.
Looking at the site it's very clean, easy to navigate. You can search by location (for of course, you're really only interested in those things being sold by people in close geographical distance with you) and also by vertical market, like property classifieds or motoring classifieds.
All in all it looks like an excellent system and very much worth checking out.