Carl Hiaasen puts all of his books in Florida with many scenes in Tallahassee. So far the geography (up here at least) has been accurate. I can’t speak to his scenes down in Miami.
It’s actually kinda neat to be able to visualize exactly the place or object he’s talking about. Many of his short stories are set on streets that I can recognize - or the Water tower (I think he calls it a Stand Pipe?) he describes in IT - actually exists.
It can also get a little… creepy…sometimes…
**Oh and did I mention he actually came into the pizza shop I worked in and bought a Mountain Dew??? I did not ask if I could touch him. really. **
William Kennedy set his novels there, IIRC – Ironwood is the best known, also Legs, and I think a third one.
Um, “there” being Albany – could have trimmed that a bit better.
The Kat Colorado Mystery Series by Karen Kijewski is based in Sacramento and the surrounding areas.
It’s really cool, because the author mentions landmarks I know and the characters go to bars or restaurants where I’ve been.
The only one that comes to mind is Maharet’s compound in Queen of the Damned by Anne Rice that was (in the book, though apparently not in the movie) located in a redwood forest just outside of Santa Rosa.
Cotton Comes to Harlem, Chester Himes
Jazz, Toni Morrison
Mumbo Jumbo, Ishmael Reed
&
Tar Beach, Faith Ringgold (close enough)
The Little Red Lighthouse and the Great Gray Bridge (can see both from my window)
Numerous Harlem Renaissance stories, and a lot of poetry by Langston Hughes.
Audrey Niffenegger’s The Time Traveler’s Wife is set not just in Chicago, but in my neighborhood, Lincoln Square. The characters are constantly going to my favorite restaurants, working in the library down the street from me, and so on.
Patricia Cornwell’s “Kay Scarpetta” novels are set in Richmond and environs, as is the first part of Even Cowgirls Get the Blues .
They give tours of the water tower four times a year - I heard there was a black handprint in there, but I’ve never seen it. Of course, it’s a leftover from one of the movies they filmed there, but it sounds like a little fun for people doing the tour. 
(It might not even be true, I heard it from a friend who is notorious for slipping lies into what is otherwise truth… an embellisher, let’s call him. But we couldn’t get in, and we were told that there are tours four times a year if we wanted to go inside. We never did.)
Also, that big, goofy statue of Paul Bunyan is real. (Isn’t he right on Main street? It’s been a while. Old Paul has been there since before I can remember.)
Also, the canal in town looks* exactly * the way I pictured it when I read IT.
I always thought of Castle Rock as more of a Bridgton, myself. And I’ve never thought of Derry as anything but Lewiston, but that’s probably because I lived in Lewiston, and I wouldn’t be surprised to find psychotic clowns lurking in the sewers there.
Peter David has made reference to my neck of the woods in a couple of his books–Sir Apropos of Nothing mentions Montclair and Upper Montclair, both towns near where I live. And in Knight Life, Morgan LeFay is confined to a town she thinks of as the closest thing to Hell on Earth–Verona, New Jersey. I believe I live up the street from her. 
Castle Rock, I couldn’t be sure, but I think Stephen King grew up in Durham, hence the guess. I could be wrong.
The only reason I’d say Derry=Bangor is the Paul Bunyan Statue, the Canal, the Water Tower (Standpipe), I want to say the airport, but there are a couple of around, not just in Bangor… I know there’s one in Bar Harbor (bah hahbah), and in Presque Isle, etc… how big is the one in Insomnia supposed to be? I forgot. :o
I’m sure there’s a mix of many of the surrounding areas in King’s fictional towns. I just connected Derry to Bangor because I recognised those things, but there are probably other landmarks he’s used from other towns that I just didn’t recognise.
Some of you may have heard of John Steinbeck, and through his books you might have heard of Cannery Row, which is a relatively short walk from my house.
Are you from New Hampshire, perchance? If so, you’ve got Russell Banks’ Affliction, John Updike’s Prayer for Owen Meaney, a few Hawthorne stories, a few Robert Frost poems…um…Donald Hall…
I meant, John Irving’s…
No, I’m from New Brunswick, Canada. Very near the border of Maine.
I was just guessing on the basis of (a) near Maine, and (b) “ayuh, ayuh,” which I connect to NH (because I’m from NH…)
Yeah, most of us that live that close to the border picked up on a lot of New England-speak. Calais, ME was a regular hangout for me and my friends during most of the week, Bangor was for day trips (only took an hour or so, but once we got there, we liked to spend the day and catch a movie). So, ayuh, you guys rubbed off on us a little. In return, we will send you our chatty Saint John River Valley Frenchmen. Beauty! Beauty! 
Midnight in the Garden of Good and Evil - Boring.
The Dangerous Lives of Altar Boys - written by the late Chris Fuhrman. I worked with him for a short time in the early 80’s. He was a funny, intelligent guy. Unfortunately, he died of lung cancer having never touched a cigarette in his life.
*Fool on the Hill * by Matt Ruff takes place on the Cornell University campus, featuring Risley Hall, the dorm where I lived.
*Eat Fat * by Richard Klein discusses, among other things, cholesterol-laden breakfasts at Ithaca’s State Diner.
Stewart O’Nan’s *The Names of the Dead * takes place in Ithaca.