I live in central London, where the water is really quite hard. I find I have to charge my brush more diligently than elsewhere, and that, crucially, the range of water saturation a lather will tolerate before losing stability is a lot narrower than in soft water areas.
So... yes, it affects my lather in that I have to be more careful, but with the correct technique, I can build as good a lather here as anywhere, and if I really nail it I can get the lather to last for 3 passes without drying/collapsing.
P.S. I know my sig says Oxford... My home is Oxford, I live in London, and my heart is in North West Spain.