It works if you live by yourself in a 1BR. To pay the mortgage on a family home you probably need to sell RSUs. It is also super risky to to buy a house you need RSUs to hold on to - exactly the kind of risk that is unreasonable if you have a family.
It's not impossible to afford a house in the Bay Area on just cash compensation, if you're a dual-finance/tech/legal/medical couple and both partners have risen to mid-levels in their organization. L6/E6 cash compensation is about $225K, two of them is $450K, figure 50% out for taxes/401k/benefits and you're taking home about $225K/year or about $18K/month. PITI for a $2.5M home (20% down) is about $14K, so you've got $4K/month to spend on everything else. That's just barely enough - it's like someone making $48K/year but having no housing expenses, which is tight but lots of people do it.
That's just totally disconnected from reality. The majority of Silicon Valley homeowners don't receive any equity compensation. You should walk around and talk to regular people sometime.
(The numbers may be different if you look solely at recent buyers in a certain limited set of neighborhoods.)
I do live in SV, not wealthy to start with, and rent my home. About half my comp is equity and it goes to paying down student loans, savings, and the like.
At current housing prices my rent is 1/3 of a mortgage payment. Buying in this market doesn’t make sense.
But everybody assumes a risk level they’re comfortable with, this works for me.