I don't get why cost of living is factored at all.
The biggest expense is typically housing. And if you bought the house, it means the biggest expense is... building equity into an asset you can sell afterward.
Keep in mind the engineer who purchased a 2 million house in Palo Alto can sell it for two million, and then move to Ohio to a much cheaper house purchased in cash. The reverse isn't true.
You also pay taxes. But you are right that for the first movers it will be an easy transition into living opulantly in Ohio. The same can't be said for the next generation of workers, who graduate and have no capital accrued from working at bay area rates, and start their careers working for these Ohio based employers at Ohio based salary rates, and since Columbus is experiencing the same lack of supply issue everywhere growing faces, this generation are going to find a cutthroat market for them like the current generation of engineers fleeing 2 million dollar homes in Palo Alto.
As long as the market is allowed to build housing to meet demand it's not too bad.
Main issue in Palo Alto (and to a large extent the rest of the bay area) is that there's massive population growth in the bay area, but very little housing is allowed to be built. This creates artificial scarcity and the people that bought houses 30yrs ago accrue massive wealth because of it at the expense of new people (and the new people that manage to buy at exorbitant rates also end up paying the majority share of taxes too).
This is the natural incentive made worse by things like locked property taxes and rent control. You really need legislation that allows the market to build (easier said than done).
The (build) supply side of the housing market is complicated.
Remember that even when you aren't hampered by lack of space and/or zoning, most build starts are still 'investments'. I knew a whole lot of folks who did homebuilding in the first decade of the century. Housing starts were all over the place, partially because the investors were sure that with prices rising, it was a sure thing, right?
But then the market glut happened. Housing starts stopped. All of those folks left homebuilding and few if any ever went back to it.
I think nowadays Investors are back to preferring smaller buildouts, potentially in more phases. The supply/labor issues from covid haven't helped things lately though.
Population isn’t coming from nowhere. You can also directly compare the amounts new housing vs new commercial development in the Bay Area to see what’s going on.
The rules created by existing residents where designed to push up rent and home prices, and they have succeeded.
But unlike Palo Alto, Columbus can expand in all directions indefinitely. So while it may have housing issues, it would be completely surprising for houses to get as expensive or even relatively as expensive as a place like Palo Alto. Though the downside here is because of car-first urban planning and design we will create our own little version of Houston.
The biggest expense is typically housing. And if you bought the house, it means the biggest expense is... building equity into an asset you can sell afterward.
Keep in mind the engineer who purchased a 2 million house in Palo Alto can sell it for two million, and then move to Ohio to a much cheaper house purchased in cash. The reverse isn't true.