In reply to cmb621:
I am on a single speed with 48 - 18 and live in Crystal Palace. i get up the hills but its sometimes not pretty especially if tired. Problem is i am a big guy (92kg) which does me no favours for climbing. I would say over 8% i start to get into real trouble.
I do however have a speed of about 30kph (at the cadence of 90) along the flat which means i can overtake 'most' commuters and at higher cadence i can keep up with most roady's. IE heading along brixton rd into town the only people who can beat me are the ones running the lights or pushing big gears on road bikes.
As others have mentioned, try a few different set ups, go down 1 tooth at a time and you get a better feel for how things change.
Good luck!