As explained in the Local Area Design article’s introduction, the stories you have planned drive decisions when designing the campaign’s local area. I’ve planned a campaign where the characters will join a group of explorers (along the lines of Lewis and Clark) who explore a newly purchased territory. Because the players enjoy a good dungeon crawl, this concept can fit rather well. The characters will explore a short distance of the new territory, find some ruins, tower, etc., dungeon crawl through that, then continue another short distance, find another abandoned fort, ruins, etc, and so on.
Therefore the characters’ home town(s) won’t be a major factor in the campaign. They’ll hear about the opportunity to join the exploration and (maybe with a bit of prodding) meet up with the lead explorers in a town near the frontier. This town will be their base of operations for their first major adventure. After that is complete they’ll move on to the “unexplored” territory.
Part of the background of the campaign is that the characters’ home kingdom borders a country of orcs, kobolds, ogres, etc. led by a ruler over all of these groups. This leader has for some unknown reason (Dungeoncraft rule #2: create a secret) made an agreement with the kingdom’s ruler to sell a large amount of land to the kingdom and to move the tribe out of that region. Therefore the kingdom needs explorers to go out and map this area where few humans (or elves, dwarves, halflings, etc.) have traveled for the past 500 years. (Before that time a large human empire and a small dwarven mountain kingdom ruled the area and they are the sources of the many ruins the characters will encounter.)
With that background out of the way, the character’s home base will be an old town near the border. This town was once much larger (though never a city) but as the ogre/orc/kobold raids came closer to the town and the border with the ogre/orc/kobolds came closer the town became smaller. Since the agreement that will rid the area of the raiders it has swelled in size as a staging ground for groups of explorers and soldiers.