Investing in Idaho

I took a trip with my awesome girlfriend Sarah to Idaho in September of 2005 to visit some family and relax a bit. It turns out that Sarah's dad is an agent in the Boise area and we spoke for about an hour about REI in the Boise area and what the market was doing. According to the local papers the appreciation rate for Ada and Canyon counties is ranging between 8.5 - 12%. This seemed very appealing to me since the local appreciation rate is somewhat dismal in Denver. Currently, CNN Money is projecting the 2006 appreciation at 8.7% for the area in Idaho that I visited.
So I asked the dad (DB) to keep an eye out for good deals in the area. In late November a rehabber friend of his asked him to put a recently rehabbed property on the market - DB called me and offered it to me before it went on the market b/c he thought it was a great deal. It was a property with 2 houses on it - both were mostly rehabbed and were in very good condition. I had my brother who lives in the area check it out for me and he gave it a thumbs up. DB thought that I could easily get $1500/mo for both houses which would easily cover a zero down deal on the asking price of $180K. After researching rents a little myself I determined that I could get closer to $1250/mo which would result in a negative cash flow of $100/mo. Not great, but not terrible b/c I would be doing a buy and hold strategy for this property. So I put an offer on the property in mid-December and ran into some financing snafus b/c I wanted a payment around $1350. We cleared up the snafus and for about 3 weeks we have been waiting for the underwriters to get an appraisal. Why the delay in the appraisal??? Well, it turns out that this is one of the only properties in the area that has 2 houses on it and they are finding it really hard to find comparables. The best that they can do so far is $170K! This is really concerning me b/c if the bank doesn't think it is worth the asking price then maybe I should adopt the same thinking. That is were it stands currently. I should know something this week. At this point I am ready to take my earnest money back and walk away. Any comments are appreciated.