cnaik: Sorry you are in this position.
If the children in your street go to your top school, then, unless there is a faith criteria, you should stand a good chance of getting in on the waiting list either straight away, or at the beginning of Yr1. Just make sure you ARE on the waiting list.
afaik, you can now go on the waitng lists for any schools you think would be suitable - and yes, you can apply in neighbouring boroughs. So, apply to go on the waiting list for any other nearby schools.
Thirtypence - sadly, in London, this situation is common: partly because housing is dense, so 400m radius around a school can easily encompas a class-worth of children, but ALSO because parents often move to within catchment to get a first child into school, then move somewhere they consider more desirable, but younger siblings continu to get priority. There are several schools in Lambeth where only a handful of 'proximity' children get in - the majority of places going to children who have siblings within the school, but live out of catchment. This problem is especially actute where parents rent for the admissions year, because each rental property on the doorstep of the school provides a generation of new admissions every single year, who then develop siblings.
But definitley appeal on the grounds that it is your nearest school.