Pretty area with lots of potential. Have you checked out photos on Houzz?

https://www.houzz.com.au/photos/query/side-passage-gardens/nqrwns

Start with deciding just what you need and want to achieve for this area - it doesn't look like the house opens to this area at all to create a mini courtyard or patio, so do you just want a pretty side passage to walk through, is it an important access area to your rear garden you would need a wide, practical pathway, do you need to create any privacy for the house? If it is a main access route for example, you would need an all weather pathway wide enough so you weren't brushing against wet plants and probably a direct route too, not a meandering path. With it facing East means you would get good morning sun and the house would block out strong afternoon sun that would damage and burn more delicate plants.

After you have identified your needs, I would take a trip to local nurseries to then see just what plants are most suitable for your area and conditions. Many cottage garden plants are annuals so may not survive frosts. Checking around your neighbourhood will also give you good ideas for suitable plants too and even see how they grow to ensure they aren't too big for your space.

Make sure you mulch the area well to help your plants in the summer heat - maybe even install a sprinkler system before you plant to make summer watering easier and only water late afternoon when the sun is off the plants so they don't burn.

You could use gravel, white or other with random pavers, the gravel will double as mulch. Check out what is growing in the neighborhood for more ideas

Thanks for the ideas! Unfortunately Olldroo the pictures are of my front garden. Here is a picture of it from the street.

We have since moved the bush to hide the strange extension on the left and painted the fence white. Behind the bush is an enclosed veranda. Because the space between the fence and the house is so narrow, I'm thinking you may be right and the area is better off without a path and making it a sort of courtyard. I have no ideas about plant heights because unless the plants are taller than the fence, they won't be seen from the street, but plants taller than the fence block the view of the house. As well, plants shorter than the fence are blocked by the morning sun and by the time it is high enough in the sky it is blocked by the neighbours apple tree then the house so it is essentially a shady area. We would ideally like some privacy too as the house is on quite a busy street. I will have a look at the links you have mentioned to see if I can find any ideas for adding a narrow garden with curb appeal.

Sorry Sherry, I must need new glasses, no idea where I got the side passage from. This really is a challenge but I do love your house, it has so much character, even the "strange" extension. I can't pick your front door - I assume it is to the side of the house?? An attractive pathway to the door would be important. The arch covered in an attractive climber is a lovely feature for your front gate and is in keeping with the character of the house.

My grandmother had a house very similar to this, close to the street and she had a narrow path along the fence to be able to walk across the front of the house and then she had a cottage garden going back to the house that always looked very pretty. Your picket fence will allow glimpses of the garden and any colour you have in it so you could keep your plantings low to allow sunlight into your home, but plants slightly higher than the fence would not block light into the house. The spaces between the picket would give adequate light for your plants too. There are also some stunning plants for shaded areas so don't let the shade deter you.

The bigger issue now though is the busy street and traffic noise as well as privacy. How big a priority is this for you because if you feel the need to address this it totally conflicts with your ideas. What about security? Is that an issue at all? A 6ft fence would address those issues and you could create a secure courtyard area, but of course it would block a lot of the house from the street. Then again a little mystery is not a bad thing and it would be a cool and inviting outdoor area in summer. It really comes down to kerb appeal -v- privacy and making the most of your outdoor space. You could also have a narrow garden in the front of the fence on the nature strip for colour and kerb appeal if that worries you.

Like I said a trip to your local nursery will help you identify plants you would like and that would be suitable for the area too and you will get a lot of help and assistance. Just looking at plants can give you ideas for design too.

What I have noticed is that you have a wide grass verge which looks like some of your neighbours have planted, this could really add your street appeal.

I would like to see a hedge (Murraya) planted inside your white picket fence that would be at least 50cm taller, trim it narrow to give more space. You could even plant outside your fence like others have. Do you have an updated photo cheers

Here is an updated photo of the house.

The grass verge has a drain in the middle.

There are a few council trees planted on the verge. I'm not sure if I'm permitted to plant there. I'll look into it. A few trees out front would make a difference. My front door is in the enclosed verandah.

I had a wander around my local nursery and found a few potential plants but am at a complete loss as to where to plant them. Up against the foundation? Up against the fence? Right in the middle? If I plant a hedge 50 cm higher than the fence, what do I plant in the space between the hedge and the house? Something higher than the hedge? Something that can only be seen from the house? I've wandered around the neighbourhood and could not find another house with a similarly narrow front garden to get some ideas from. I like the idea a the path close to the fence. Right now we have to walk on the wet grass or through the mud to get from the front door to the car. I'm keen to get digging!

just a few ideas for you

Casa Real · More Info

Peninsula Estate 06 (Design by Suzman Cole Design Associates) · More Info

Grape · More Info

Window Boxes and Containers · More Info

Sherry, I really love your house, I love the charm and character of weatherboards. I'm trying to buy a new home for myself and would choose something like that in a heartbeat, except there is nothing like it in the area I'm looking.
Looking at the first photo, I think I would let your house shine on its own merits. Definitely put a decent path to get to the car and along the fence seems perfect to me. Allow width for carrying bags of groceries and such so you don't hit plants. A path with garden each side means you can be brushing against wet plants too as well as damaging them. I really can't see you gaining any privacy in this space without blocking the house from the street so I think I would forget about a hedge and just go for a cottage garden, it would suit the house perfectly. Look for some perennial plants that don't require a lot of maintenance. Hydrangeas, for example, look fabulous when they are in flower, and they grow easily from cuttings but they do require severe pruning each autumn or they grow very leggy and untidy. Miniature varieties of azaleas, gardenias and such will add colour and perfume year after year with minimum maintenance and ground covers will help keep the weeds at bay. Astrogirl mentioned lambs ears - they make a lovely contrast in a garden and are also very easy to grow from cuttings. You can also add some height by putting flowers in tall pots

As far as the nature strip goes, you would need to approach the Council about planting more trees. Many Councils will provide residents with trees when they know the residents will care for them or they will specify what you can grow. There are legal issues to consider when this is public land. Some trees have surface roots for example that can cause a pedestrian to trip and fall. Just be sure more trees won't stop sun and light to your garden so your plants don't grow and too much shade will cause moss to grow on your path that can be slippery and dangerous.

Another issue to consider in planting close to the house are termites, especially with your weatherboards. How active are termites in your area? If you are in a termite prone area, it is not advised to put large shrubs against the walls of the house, you need to allow for air circulation.

Don't stress too much over your plantings, like Astrogirl said it is all an experiment. Small plants can be moved if you change your mind. The best garden is one that evolves over time and it is so much more satisfying.