I used to work for Wells Fargo Mortgage. An interest only loan isn't all that bad in Arizona - like you said, our real estate is constantly rising. I guess that's one reason to be thankful for the snow birds (maybe the only reason, lol). Our house has increased in value by about $125,000 in 2 years.
All I have to say is - if you don't feel 100% comfortable, don't do it! Buying is always better than renting though - at least you're money is going toward something instead of being "thrown away" every month.
Congratulations - I'm sure you're super excited about it!!