Margins seem low and the risk seems high.

Going into an area with little data is high risk but could be high reward. 

They're highly popular for turnkey rental properties because qualification is primarily based on the income generated by the property itself rather than the borrower.

This isn't just high risk your talking about Zach, your talking about compounded high risk. 

Paying a bit more might be justified if the pro forma income is very achievable, but $360,000 seems too high unless renovations are already complete.Factor in the costs and timeline for completing renovations for the studio and the fifth park-owned home.

I do need a property that is not very expensive, which is why I have been looking into Clevland due to their low selling prices and high appreciation rates.  

Since the LTV on the hard money loan is high , I would personally purchase it using a bank statement loan at 85% LTV (15 percent down) and, as you mentioned, just use your cash for the rehab.

We make sure to do the work to a high degree.

I have not paid retail for RE in many years and would not in my high cost market (average SFH is ~$1m).  

Most often owners have too high of expectations for C/D neighborhoods.