This works and is quick/cheap to do.
The much better options is a well written page on each area.
This way each page is 100% optimised for the keyword and contains useful, local, relevant information.
Start with the largest areas (on search volume) and add a few more pages each week/month.
If you have a list of areas as large as this then use slightly larger areas and target the big town for the page but also make references to the smaller villages within that page. Means the higher volume is well optimised and the lower volume pages are semi-optimised on a relevant page.
Interlink each of these pages to 2-3 of the others to create low OBL, relevant, varied, internal linking - rather than a single page like above with links to all of the pages.