I would say for disk space at least 250MB, PHP supported, MySQL like a 10MB database included. Also it would need like 10 POP email accounts, and have a good support backing. Probably like 10GB of Bandwidth.
Actually, being the cheapest host shouldn't be your strong point unless you have the advantage of high volumes (hundreds of thousands of websites, your own datacenter etc.). If you just rent a server or colocate you'd better focus on high quality service and use prices that cover your costs (all costs, not just getting the server) + give you a profit.
What HostSpecs is referring to is overselling, which is very tricky and should be done only by experienced hosts with lots of customers (IMHO).