I had similar problem, and although I had tried this :composer create-project laravel/laravel {directory} 4.2 --prefer-dist
What I realised is that the above command is that it would only temporarily resolve the issue ,with regard specifically to the new project that you have created.But it would not resolve for your other new projects.
The correct commands to resolve your problem completely are these two:-
composer global remove laravel/installer
composer global require laravel/installer
What I realised is that you can copy-paste the two commands at the same time,but you will need to click enter button after the "remove command " {first command } has finished, so that the second command can run...remember.
After leaving the two to successfully complete, use the command,laravel -v, e.g C:\xampp\php>laravel -v , to check your update version of the laravel installer.You should be able to see something like :Laravel Installer 4.2.8
Thanks to these commands my issue was resolved.