Tall buildings [+] are why Tokyo is so affordable.

I live in the 2nd hottest neighborhood in the city. You can rent an apartment within 4 blocks of me, tomorrow, for $800 a month, and you'd have many choices. If you were willing to live further out or in a less prestigious neighborhood you could trade up on size, too.

[+] Tokyo is very much not monolithically tall buildings. I live in a 45 story highrise; less than 25 meters away there exists single-family housing and 3 story apartments. The average density is pretty high, though -- here in Meguro it is about 2.5x SF's citywide (50k people per square mile vs 20k).

Effective transit is what makes tall buildings in Tokyo work.

SF would need to invest tens or hundreds of billions of dollars in transit in order to make Tokyo style densities work. Just digging out the sides of Embarcadero station to allow two-sided boarding for BART is projected to cost a billion dollars.

If people who work in SF could also live in SF, wouldn't that reduce the demand for taking BART across the bay? Yes, that's oversimplifying things a bit, but the principle seems sound.

It's a chicken and the egg problem. If the population is denser, than public transport systems like light rail, become cheaper and more effective. If the amount of people within 1km (i.e. walkable distance) of a light rail system doubles, then people are closer to a train station and it's potential customer base has increased.

How many square feet does that $800 per month get you?