Mortgages in California

There is so much talk happening these days in regards to the current financial climate. Most of it is centered around investments such as mortgages.

In California mortgages are being defaulted on at a rapid pace. Some of this may be due to variable rates or interest only loans. A lot of it appears to be lack of education to the buyers taking out the mortgage loans.

How can you go about owning a home though without taking out a mortgage? One must take out a mortgage unless you win the lottery. Or is there another way?

I have often thought about moving to Arizona. Housing is cheaper and a good friend lives there but it seems the same thing is happening to Arizona mortgages as well.