This. I live around the corner from that £900k terraced house in Peckham linked earlier.
Given the option between spending £900k on that house and £1500 on council tax each year, and spending £200k on an identical house in a cheaper council area and then £2500 a year on council tax, there’s no question which one I’d prefer to do.
And of course many people do make that decision and move out of London when they have kids, at which point people bitch about them pushing house prices up.