The house was offered "AS-IS" and we're buying with cash.After the AO, it was disclosed to us that a "Paper-Road" runs through the property and is the responsibility of the homeowner to maintain this parcel, which is about 25 feet worth of side yard.  

This assumes he can handle credit correctly if he's on biggerpockets I'll give him the benefit of the doubt he can maintain a 3% credit utilization. 

You also might find that you like this strategy better do to lack of maintained and other issues.

Some other unforeseen problems you may have not considered: As a tenant, you're taking up the large yard I planned to use to play catch with my kids and let my large dog run and play with a garden that I have no intention of maintaining.

Clear accounting maintains friendships...

They will fail to pay the bills (including rent to you) on time and regularly, they will fail to do the yard work, they will fail to maintain the interior and make any necessary repairs that come along. 

The current tenant has been living and maintaining the property.

Preventive Tips:     - Regularly check and maintain faucets

Are there any other ways to utilize my 50k to earn me some cash flow while maintaining 50k or more in equity?

Doesn't the seller maintain the loan in their name, therefore limiting their access to gain another loan on a new home?