Though fee schedules vary by company, generally speaking, you'll pay more up front for checkbook control and less over time, since the full custodial companies will have transaction fees not to mention the red tape of going through the custodian for all transactions. 

Just from the little you wrote, it's pretty heavy on the red flags. 60 days on the market (depends where this is whether that is a lot or just fine, but definitely overpriced at this many days) plus no sold comps.

However, when you look at the Affordable Housing website, only 4 out of 32 available properties that accepts voucher are listed by $1,550 or more.Is that maybe a red flag that there's no demand for Section 8 in Cleveland? 

You can't purchase the software stand-alone (red flag for someone with some experience).

New irrigation, sod, plants, trees, rocks/shell, paver patio, driveway, exterior lighting, and fence.What made you interested in investing in this type of deal?

Melissa DSCR loans are business purpose loans therefore there is much less documentation and red tape to deal with vs conventional financing.

Or would this raise red flags for conflict of interest? 

I just find that they aren't worth it because of all the edits you have to make on the spreadsheet to get the same result, and one of the softwares refused to allow Journal Entries which seemed like a huge red flag to me. 

Add in property manager, repairs/maintenance, CapEx, vacancy etc and you will be deep in the red.

It’s true that you should be more diligent with vetting tenants - cash flow is great, but a destructive tenant can burn through it pretty easily and put you in the red.