His argument is that he specifically looked for a lease that didn't stipulate NO SMOKING so that he could smoke inside his home.

I'm talking about having contractors inspect the roof, HVAC, foundation, etc.I know the best answer is to always do this in case the tenant goes dark.  

Utilities not onInoperable heat supplyMissing or insufficient weather-strippingLoose or torn carpetMissing or cracked electrical outlet cover platesCracked or peeling paint on wallsCracked or broken window panesMissing refrigerator kick platesEvidence of roof leaks/pipe leaksDirty stoves, ovens or walls and unkempt perimeter surrounding houseInsufficient bath ventilation and inoperable smoke detectorsLeaking faucets or plumbingNo temperature/pressure relief on water heatersYou screen your own tenants, then you submit the paperwork to have a tenant approved by the Housing Authority.  

That story isn't adding up to me either because I shouldn't be so in the dark about the past if that were true. 

.- stainless steel with become the new avocado- vessel sinks - really dark wood floors. - granite colors will change but solid surface counters are here to stay, doesn't matter what they are made of. - those vertical glass backsplashes, separate wine fridges, and drawer appliances will definitely date a place.

Obviously they aren't in the lap of luxury but they are not in areas Id be afraid of after dark. 85710 and 85730 are pretty solid areas with older homes and no HOAs to deal with, unless you look in a development.  

He also commented that he smoked occasionally outside.

Upper tenant is smoking in the unit, also a slob.Both rents are paid on time, they have no intention of moving.Do you do anything to fix the water issue, considering the tenants don't care?

In my neighborhood I ride my bike and walk after dark all the time. 

You have all these folks that don't even know what to do with a lead spending money sending out this stuff ... when if they were smart they would spend that money getting a RE linense and learn the business and become a RE professional than a wanna be investor wholesaler with no money and what ever credit and money they had just went up in smoke sending out letters with no ability to follow up or keep the campaign going there is no doubt you can get business with direct mail but most don't understand its a multi year commitment and many thousands of dollars. if you just blow your wad and your done then you will be broke and done and off to your cube to work for the man LOLPS I don't send out colleague request as I don't know how to do that I only accept them.