[inlink]jason,132[/inlink]Before I get into this, no place on earth is so sweet that you should give up at least half your income just to have a roof over your head.
Well that's a matter of opinion, since money is meaningless except for what it can get you. (Unless you're into money purely as security, that is.) Only you can decide what you want to spend it on, though. I don't see it as such an absolute. For instance, would it be worth it to you to cut whatever you spend on housing now in half by moving to South Dakota?
Anyway, the smartest financial move I ever made was to buy my first house (a two-family for $144k in Medford MA) which seemed like a huge stretch at the time. I got a first-time buyer loan where I only had to put 5% down and could add 75% of the projected income from the rental unit to my actual income to qualify. That scared the b'jesus out of me. But I quickly rented the downstairs apartment to the bonny Sullivan brothers and even carried them for more months than I care to admit when they ran into financial trouble. And the tax break I got on mortgage interest brought my actual housing costs down close to what I had been throwing away in rent. Instead of throwing money away that house turned into the best savings plan I could have picked.
The (second) dumbest financial move I ever made (let's not get into the first dumbest) was to NOT go through with buying the 3-unit Victorian on Haight Street when my offer was accepted the same day I got laid off a mere seven months after transferring to San Francisco. I played it safe and invested my real estate nest egg in the more conservative option - my little California bungalow here on the island hideaway of Alameda.
I guess I could have been even dumber and not bought into the market then at all, given all the uncertainties. Really played it seemingly "safe" and continued to subsist in the rent-controlled flat I shared with two other roommates. You can live pretty cheaply if you can get into a rent controlled apartment where at least one tenant has been on the lease a long time. I was paying $503/month to share a 2-bedroom 2-bath full floor Victorian flat with two fireplaces, double parlour (the master tenant's suite), living room, kitchen and sun porch with two other roommates. I was the only one with a "real" job. Until I got laid off, that is. Move to California, become a degenerate. ;-)
Wait a minute, this isn't the story I wanted to tell! Where was I? Oh yeah.
So there are a whole lot of factors involved in the cost of living comparison, many you have no control over (property taxes, for instance). It doesn't pay to get hung up on whether the things you can't change are right or wrong. It is what it is, just factor it into the equation and decide if the resulting scenario is worth it to you or not. Trying to nickel and dime every piece of the equation as if you could plug them in somewhere else might be interesting but in the end we only get to live in the real world, unfair as it might be. I learned that the hard way.
What can I say, I'm really not trying to talk anybody into anything. I just know I spent way too much of my life deliberating over things that in the end were not important. I'm also old enough to really know my time is limited. And for me, waking up every morning in a place where the weather is typically a joy not a battle, I have 450 miles of Bay trail and the Pacific ocean in my back yard, a city that is an international tourist destination across the Bay, local fresh produce year-round, cultural diversity, great housing stock, liberal, creative, individualistic friends and neighbors - that to me, as the credit card commercial puts it, is priceless. But that's just me.
View of the city, the ocean, the wilderness from Marin Headlands approximately 35 minutes from my house.
Too bad I'm not a better photographer. Maybe (e:Matthew) can come out and take some pix that will do the area justice. I'm officially retiring as Bay Area promoter.