Hello Kathy, what beautiful floors you have.....too lovely to totally cover. I think you're on the right track using two large rugs which will delineate the two usage areas but still show off a bit of that pretty timber. If you can make the rugs big enough to allow a nonslip path for your dog, so much the better. lhh

Do you have any other access to the backyard? Lane at the rear etc? If not... I like your plans but I wonder if you will miss the access down the driveway. Possibly a problem should you sell later on, or should you need to bring large amounts of materials etc into the rear yard. I'd think about using the front of the house for all the bedrooms. Possibly the sun starved middle room for the master suite. Extending it though to the room you have marked as pantry. I can't see the dimensions, so I hope it's big enough. And use all the rear space, minus the bump out, as living. You could maybe pull the kitchen into the centre, looking out to the yard, pantry + laundry behind it against the for mentioned bedroom. Splitting the living area up a little. And giving you much more living space.

Two years later... We ended up purchasing a 3-seater for wall opposite fireplace, a 2-seater for under the highlight window (leaves a comfortable space to enter the room) and an armchair placed diagonally opposite the couches. I've fooled the advice to pull the furniture in off the walls a little. We have just updated the fireplace with the (professional) installation of an insert wood heater and (DIY) replacement of hearth and tiles/timber mantel to conceal the brick while meeting the safety specifications of the heater (required a much wider/deeper hearth than the existing brick one so we removed and replaced with a slab of honed granite, and the minimum height for breastplate/mantel shelf posed a few design limitations). TV mounted above fireplace to allow for better furniture placement. Not quite the picture I had settled on 2 years ago, but works with the style of updates we have made elsewhere. Thank you for all the advice. before: After:

These are all good ideas but I think the room is laid out to invite people to way through the centre. I thought pull out the soft off the wall and still facing the TV. But more in line with the door that leads to the garden. That way people are forced to walk behind the soft. If you purchase the modular settee it should work also but I think one of your favourite bright colours would work very well too. Also with my suggestion I would turn the rug around to link it between the TV cabinet and the new placed sofa. A coffee table placed lengthwise along the rug would be lovely too.