when i purchase rental house, I consider whether renter will like to live in the house. As I like to do business with people similiar to myself, i buy nice house in nice neighbour. Although it can't be as big as my own house, it needs to be above median price house.
but i do agree the number needs to work. In this market, I find it's hard to make money or positive cash flow from renting single family house, so i am counting on the long term housing price appreciation.