You want to compare apples to apples, not apples to bananas.Calculate what the SELLING COST PER SQUARE FOOT of each of your comps was (as opposed to the listing price per square foot), then multiply the square footage of your subject property by the AVERAGE cost per square foot of the comps.  

I'm trying to get my head around cap rates and gross rent multipliers. 

You can go here: http://www.lubbockcad.org/Appraisal/PublicAccess/ and do a property address search(s) to see what the current appraised valuation is set at and how much the tax bill was for at least the last 5 years.Then to be safe, take the sales price (likely larger than the appraised value, but not always) and multiply it by the tax rate listed on the bill for that property.  

Take the average price per square foot and multiply it, by the square footage of the Subject Property.

In my opinion when looking for a buy and hold market, the Most important factor is your CAP rate and/or rent multiplier, whichever you chose to use for evaluation of cash flow. 

Type in the value of the house multiply that number by .07Example: $123,000 (ARV) X .7 (70% in decimal form) = $86,100Then subtract repair cost and subtract your wholesale fee. 

But your cash-on-cash return drops dramatically while you tie up that money that could be going into another deal thereby multiplying your asset base.

Other formulas suggest applying a fixed profit target to the purchase price (i.e. instead of a 0.7 multiplier, calculating the ARV and subtracting repairs costs, profit, and carrying costs, etc. separately).

I know of somebody who bought 5 different "home study courses" from visiting speakers at the local REIA (average price ~ $1495, multiply by 5 to see the money spent); the only house he ever purchased as an investment was from a wholesaler (so he really didn't end up needing any of those fancy courses IMO).

Divide total monthly rent by 2% (or multiply by 50), then subtract any repairs needed, and you have your maximum purchase price.