There are ways people without FAANG-level salaries are able to afford San Francisco:

1. Purchasing when market prices were lower, or inheriting a home. San Francisco has been expensive for decades, but it didn’t always require FAANG-level salaries to afford purchasing a home there.

2. Living in a rent-controlled unit and avoiding evictions (e.g., if the landlord wants to sell, move in, or redevelop the unit).

3. Qualifying for government-subsidized housing, in the form of either Section 8 (voucher-based housing assistance), below market rate rentals, or below market rate properties for purchase. Many Bay Area municipalities have a local housing authority that provides more information about local subsidized housing programs.

4. Shared living situations, whether it’s with family, friends, or strangers, helps reduce housing costs at the expense of needing to share space with others. I know many people in the Bay Area who wouldn’t be able to afford to live here without some type of shared accommodations.

5. Some employers subsidize housing expenses. For example, some universities in the Bay Area offer housing assistance to tenure-track faculty members, ranging from down payment assistance to zero-interest mortgages. There are some universities that sell homes to faculty and staff at below-market prices, with the stipulation that those properties get sold to other faculty and staff once they are put up for sale.

6. Sell drugs

7. Sell themselves

People who bought houses at any point in the last decades are house-rich and have a low tax basis thanks to Prop 13. Otherwise, there's an active, ongoing exodus of non-tech people, as well as increasing cost of living and longer commutes for people who stay.

Someone needs to serve the burgers though. Are you saying those people commute two hours each way?

Oh, definitely. One of the worst commutes in Northern California is the Altamont Pass, which Interstate 580 traverses. As early as 4:30am there is a long line of cars filled with commuters who live in more affordable Central Valley places like Stockton, Modesto, and Tracy, commuting to either Silicon Valley or San Francisco. These are generally not FAANG software engineers; they do all sorts of other work, such as cleaning offices, preparing food, stocking aisles, teaching students, building Teslas (Tesla has a shuttle that goes from Modesto to its Fremont factory), policing Bay Area communities, fighting fires, and a lot more.

The megacorps also have buses that run to distant towns. People have informal roommate situations midweek and ride the bus home for the WFH+weekend.

Some people live in their cars during the week.

Yes - check out Brentwood, Gilroy, etc where middle class Bay Area residents are commuting from. The expense and shortage of non-tech labor is also pushing things like ghost kitchens, coffee robots, self-checkout kiosks, etc.

This actually sounds a lot like Vancouver in Canada.

The increasing homeless population says yes.