Another method, that doesn't mean scrolling to the bottom of longer messages.
Slide the email to the left, slowly, until you see some option. If you go to far you'll end up trashing the email. Not the end of the world, as you can always open the trash folder and get it back.
You should see a More option. Tap this and you'll get the expanded options, including the ability to choose the flag color.
If the flag color is already correct, you can just long press the email list and chose Mark, and then the submenu. This is also how you can mark and email as junk.
It is possible to change what options show up for a left and right slide on the email in Mail's settings under Swipe Options.