South:
Sam’s right, Clapham is very cool. Which makes it hard to find a good place, although you are always better off finding a whole place as you mentioned you're planning with friends, than trying to find a room and going through the process of being interviewed against loads of other people.
I don’t know much about Stockwell/Balham.
East:
Shoreditch
Old Street
Angel
They are noisy, yes, but if you love central city life and all the perks, and I do, they are great places. Many MANY cool bars and pubs you’d never get bored. And you can find quiet spots too. Same applies though, these places are very popular.
North:
I don’t know much about north, or anyone who lives there really. We Kiwis tend to cluster, and few I know have ended up in that area.
North-West:
Kilburn
Dollis Hill
Camden
Swiss Cottage
Ladbrooke Grove
Camden is again really popular and probably a bit pricey too. Kilburn/Dollis Hill I only recommend as I know lots of people in the area, although they are nice places, and that to be honest tends to drive where you live because having to cart your arse across London for an hour to see someone sucks, plus the tubes stop running after midnight so it’s either a night bus or the couch if you’re out in their area.
West
I don’t have many friends who live out West any more. That's places like Hammersmith, Ealing, Acton etc. It’s full of Kiwis and Aussies who spend their time at the Red Back and the Walkabout and think that the Polish who live next door are the dirty immigrants, and are quite an away mission from the world we inhabit these days. But most people live there at some time.
Hope that helps, that’s all my opinion of course! I’m sure people will argue their area is the best in London.