I'll help you find a property with no trees that could harm your investment.

You want to stay on top of this because if you have tenants who pay late, but you aren’t tracking it, so you aren’t aware of it, they may get in the habit of paying later and later each month which can be a slippery slope.KEEP YOUR BOOKS UP-TO-DATE.

There are tons of temples on the internet, you can download them then modify one for your purpose.After you build up a good habit of tracing records, an iPhone notebook can actually do the same work.

You can threaten them back with threats that you have all the info from the vendors and will report them to the state real estate board and attorney general.Would advise toterminate ASAP and find a new PMC.We don’t know any PMCs to recommend in the area mentioned, but since selecting the wrong PMC is usually more harmful than selecting a bad tenant, you might want to read our series about “How to Screen a PMC Better than a Tenant”:https://www.biggerpockets.com/member-blogs/3094/91877-how-to-screen-a-pmc-better-than-a-tenant-part-1-services-and-processesWe recommend you get management contracts from several PMCs and compare the services they cover and, more importantly, what they each DO NOT cover.

Assessors records typically assume normal wear and tear unless a building permit is issued for repairs or it's placed on a "unfit for habitation" list.

No harm no foul, thanks for being an awesome resource - I see you aim to help a lot of people based on the volume of your posting :)

Which ultimately can be just as bad, while building poor investing habits. 

2) I'm not quite sure with all of the zoning issues in this particular neighborhood, but I assume it would not be easy to make the basement unit habitable (not sure if its just an egress issue)3) If the house is currently fully leased, would it be possible that I stay in the illegal unit in the basement?

As soon you get in that habit of conquering each negative aspect.

We also see spending habits such as $ spent at pet stores, rent payments amounts and when they pay it.