In CA peopel pay a premium for the good climate (no harsh winters, no Hot-Hazy-Humid summers), less discrimination. The flight from SFO to Shanghai is at least 3 hrs less. There are many other good things for CA.
Likewise, we pay a premium for good school, good location. If a NJ SFH is within 20 minutes to downtown NYC, it won't be cheap. You either pay more $ or spend more time.
Let alone 3% property tax in NJ and it grows over the time.
The bottomline is, no one is dumb to pay more.