Yeah, but the super expensive places tend to also have other great stuff apart from great salaries. For example, Donald Knuth lives in Silicon Valley, and I doubt that VC capital is the reason.
Maybe because he works in Stanford, which is in the heart of Silicon Valley? And he's been a faculty there for 40+ years, so he probably could afford a house there. AND Stanford has a program where you can lease a house on campus? Lots of reasons, all containing the word "Stanford" :)