Lawns use a lot of water, generate green waste, require fertilizer and pesticides, and must be mowed and edged. But, there is nothing else quite like them. They create a tough, durable surface that takes foot traffic and can stand up to pets and children.
Decide exactly how much you need for play areas and for pets. Remember that kids can play in parks where the city is responsible for lawn care. Reduce your own lawn to the minimum to meet your needs, and landscape other parts of your yard with low-water use plants. Be sure that your irrigation system is set to provide the correct amount of water for each different area. You will not save water if everything gets the amount of water required by turf, and many low-water use plants will fail in these conditions.
A mix of gramma and buffalo grass provides a terrific native turf. It has fine, green blades. Weed control can been an issue. The grass is not extremely dense so it does not crowd out the weeds.
Gramma grass, Bouteloua gracilis, can be planted by seed during the summer (June or July). It grows when it is very hot. After seeding, water 2-3 times a day for about two weeks. Misting to keep the germinated seeds wet.
Buffalo grass, Buchloe dactyloides (native to western prairies, not California) can be used to fill in. This must be grown from plugs, not seeds. You can buy a flat of it and divide it into plugs.
A yarrow, Achillea millefolium ‘Rosea’, is another option. Again, weeds can be a problem since the lawn is not dense. Yarrow can be mowed. It requires some irrigation. Be aware that yarrow causes resistant grass stains on clothes. Yarrow can take limited foot traffic but will not provide a durable walking or play surface.
Clustered field sedge, Carex praegracilus, is another native turf substitute. This looks more like a dense, dark lawn. It requires water, though probably less than traditional turf grasses. It can be mowed occasionally, or left unmowed to create a meadow garden.
Recycled concrete, flagstone, decomposed granite or other inorganic surfaces can also be used for a low maintenance garden area that will take foot traffic. These permeable surfaces reduce urban runoff that is responsible for much of our coastal pollution.