Craigslist Rss module is a free joomla extension. Craigslist Rss will get the latest ads from craigslist from the city where the user is browsing from. While setting up, you can set up from 1 to 50 ads to display from category of your choice. You can filter the results with certain keywords too.
This module is based on Jeremy Wilken's awesome video tutorial that I found on joomlatutorials.com

Here are some of the pictures.

Admin page

Frontend page with module set on the right.

To download craigslistrss module for joomla 1.5 click here.