I have a house just out of the city.
You do? I thought you were living here. (1)
You do? I thought you lived here. (2)
Would it be unusual for native speakers to use the second sentence instead of the first one here?
anonymous Would it be unusual for native speakers to use the second sentence instead of the first one here? No. Not at all.
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anonymousWould it be unusual for native speakers to use the second sentence instead of the first one here?
No. Not at all. Both are correct and natural.
CJ