How much can I expect to pay for a multi family apt?

[Derik S.]

A newbie here, wondering how much I would expect to-or in the case of finding a investor, would expect to realistically spend on a multi-family apartment complex? These things do not come cheap, especially in the cities where the market is piping hot. My strategy would be to buy and hold. According to Zillow, my home states capital of Denver, came up as #1 on the housing market. The first example is in Denver, second in Richmond, VA (another hot market)

4295 Hooker Street (seriously)

Asking Price: $595,000 

Cap Rate: 6%

Units: 4

3806 Chamberlayne Avenue 

Asking Price: $430,000

Cap Rate: 9.37%

Units: 8 

While I don't fully comprehend the idea of cap rate yet, I would be willing to guess the higher it is, the better it is. The property in Richmond is nicer than the one in Denver, yet is more expensive.