measurements shown on your plan are inconsistent, please repost a copy of the plans with rough measurements of all the rooms but delete your address...we also need a site plan and direction of north but i'm sorry to say that i would expect a new kitchen and two bathrooms would spend the entire budget without an extension so suggest making a whole house plan that can be built in stages then, when funds allow the bathrooms can be reconfigured but what is the most urgent need, is the roof over the terrace separate to the roof over the rest of the house and a copy of the unsuccessful plans would also help.

I have honestly lost count of the number of projects I have worked on with exactly this brief - 3bed+1bath upgrading to 4bedrooms +2 bath (usually due to growing families ;)............ultimately the solution/advice will come down to the budget available. When you say the builder came back with a quote too high, I"m guessing it was in fact most likely realistic for what you have proposed, and hence rather, the design solution sought is mismatched to your particular budget. It's not necessarily the quoting builder's fault....

Generally, unless the existing house is generous in scale, extended building is required to achieve this sort of overall project Brief requirement....and this in combination with the usual accompanying renovation to existing scope, compounds to a significant project.....I have found they generally end up being in reality something ballpark starting at min $300K+........If $120K is your budget you need to be super disciplined and clear about your priorities and work with someone who can provide you with experienced answers as to what particular ideas/changes will cost and are realistic to consider for your context......my advice, clarify and prioritise the most important needs. You also often find that the option of rearranging everything to squeeze/fit everything in within a specified perimeter will cost similar (for a somewhat compromised design solution) to that alternative option of minimal renovation + a "clean" extension that minimises any make good/changes to existing. Without knowing the condition of existing (or site conditions/scale/context etc) it's difficult to provide accurate advice but as a general idea I would suggest consider an option that archives a living/kitchen dining in a concise new extended area, integrate a new entrance in-between the old and the new with possibly the existing living becoming the master suite and not touching the other part of the home. You may be able to achieve a better overall value/m2 end result, but it will involve a larger budget. $120K will struggle to cover much more than cosmetic upgrades/minor reshuffling of existing areas essentially maintained in current scale and position....the other option is considering a Master Bedroom/Bathroom extension and keep existing living/kitchen dining zone, but again really need more info/understanding of your context to provide detailed advice in this regard.

Hope this helps with you thinking it through.....it's rarely a straight forward process :)