That's the economically rational thing to do if things are all equal. However, the reason many people are moving to SF is because that's where the VC money is,

That's the economically rational thing to do if things are all equal. However, the reason many people are moving to SF is because that's where the VC money is, and therefore that's where the tech jobs are (yes, I know there are other tech hubs out there, but none as big as SV). If the VC money was more willing to spread out, and not require everything to be in SV, then we'd have less of a housing issue there.