The real opportunity cost is not living somewhere else. Run the math and SF is best avoided.
Consider Hong Kong as an (extreme) example, where leaving the city means emigrating to another country with another language etc. (yes, HK is technically a Special Administrative Region of China, but can be considered standalone in this respect).
The median apartment price/income ratio here is 18, compared to a US average of 3.9 (the highest cities in the linked article are 13) [1].
These ratios also don't consider what you actually get. The average size of new apartments sold this year in HK was 610 square feet at an average price of US$1.8m and one new development offers apartments the size of Tesla Model X for ~US$500,000 [0].
If you want to go larger, the per square foot cost goes up. At the extreme end, consider a 4000 square foot townhouse that costs US$21,190/square foot [2].
A more ridiculous example is perhaps the sale of a car park earlier this year for US$600,000.
For reference, the median household income is ~US$38k. [1]
Unfortunately those with the most housing affordability issues are those that are least capable of leaving.
[0] https://www.bloomberg.com/news/features/2017-06-14/you-can-b...
[1] http://www.demographia.com/dhi.pdf
[2]http://time.com/4752342/worlds-most-expensive-house-square-f...
What is worse, this cancer got exported to mainland China in the 1990s and it was systematically rolled out for all major cities there. $1.8m buys you an 80sqm new apartment in Shanghai in an below average location, when the median household income in Shanghai is definitely lower than US$20k.
It is lucky to be living in HK as there are still public housing options. In cities like Shanghai and Beijing, using the national household median income figure, a Chinese peasant needs to start saving the deposit from the Ming Dynasty (1368–1644) to be able to afford an average apartment there.
http://www.demographia.com/dhi.pdf
The top 10 least affordable with respect to median price/income ratios:
China Hong Kong 18.1
Australia Sydney, NSW, 12.2
Canada Vancouver, BC 11.8
N.Z. Auckland 10.0
U.S. San Jose, CA 9.6
Australia Melbourne, VIC 9.5
U.S. Honolulu, HI 9.4
U.S. Los Angeles, CA 9.3
U.S. San Francisco, CA 9.2
U.K. Bournemouth & Dorset 8.9For household who already own, their existing apartment also appreciated, so what matters is the cost of trading up. The hardest hit group are younger people between 20 and 35 who are stuck in their parents house for probably forever. 3 generations under 1 roof is pretty common.
I've lived in cheaper but boring places. The financial tradeoff is fair.
But lots of people are plenty happy in the "boonies". They just have different interests, like doing more outdoor-oriented activities like hunting, hiking, fishing, or building their own workshops from scratch. Or maybe they're more cerebral and like the peace and quiet so they can focus on writing.
It's worth pointing out that far more people live outside of San Fransisco and New York (sure, throw in LA and Chicago, too) than inside those metropolitan areas.
Each of those cities is unique in different things. So they are part of the fatter part of a long thin tail. But that's not the same as "everyone wants to live here!"
I don't disagree. Different people want different things. I'm just pointing out 1. why people like living in big metros and 2. the flaw of basing where you live entirely on the cost of living and real estate.
You can do all of those same things just living an hour east of SF.
I can't get a well-paying job, or access to any of the above without being close to the city.
No, an hour east of SF is deep in the Central Valley.
So the problem with living beyond Pleasanton is that you will spend most of your life sitting in traffic. Why do you need to sit in traffic? Because almost all the jobs are in the Bay Area. Maybe that won't be as big of a problem soon though once you have Level 4 autonomous driving. Personally I still wouldn't go for it with that.