You have done a beautiful job of tucking plants into the crevices of your retaining walls. Your house trim color is perfect -- just slightly lighter in hue than the retaining wall blocks. First I would paint the big, flat gray wall slightly lighter than the blocks and slightly darker than the house trim. The concrete walk and stairs I would stain a mottled blend of the blocks and the house trim colors. Next would be to paint the railing black or the house body color. Now, think of the following as creating a light, airy trellise structure from the walk-level face of the (currently gray) wall to about 7' above the top of the wall (using 6x6" posts attached to the wall) with a corresponding line of posts sunk into the terrace level 2' in from the outside edge of the wall-attached posts. The inside posts would be about 6-8" higher than the outside posts. Put 4x4" wood to attach the outside line of posts to each other and do the same with the inside line of posts. Run wood pieces at the top of the two lines of posts from the inside line to the outside line at about a 45 degree angle. They would be cantilevered up at the terrace level. Across the top of the angled pieces create your top trellise boards which run parallel to the two lines of posts. OK. There you have your basic structure. You might want to extend the structure around to follow the street side of the terrace. You could then follow the suggestion of reom10 above about creating a bench-planter on the terrace side. Your spacing of the boards parallel to the gray wall and attached to the outside posts would determine how private you wanted your terrace to be. You might want to soften the terrace "floor" by using something irregular like flagstone with groundcover plantings between the stones. From the latticework on top of your structure you could hang seasonal flower baskets. Plant vines to go up the trellis and spill down the wall. How about planting a row of tall, narrow shrubs along the neighbor's fence above your terrace to help add to your privacy and make your yard feel less 'structured'? Or, how about patio table/s with umbrellas to block your neighbor's view? Anyway, you have a fun project ahead of you.

I would suggest you take out the cabinet that is to the right of the stove and use it elsewhere in the house -- perhaps in the bathroom or dining room with a hutch above it. Then, I would suggest you have someone install a lazy susan cabinet in the corner between the sink counter and the stove, meaning you would move the stove down a bit and have a small cabinet/counter top to the right of the stove. I would suggest you have the cabinets refinished in white and then paint the walls a pastel you like. If you would prefer white walls, then add white-painted crown molding and paint the ceiling a light neutral blue, such as Sherwin Williams Niagara Falls Blue. Then, I would suggest you choose a favorite accent color and use this sparingly in accessories like towels, pot holders, small vases or floral arrangements, and a valence above the triple windows. For a genuine 1940s look, you might have white ceramic square tiles with a rectangular red border installed as a back splash behind and above the stove. If you are replacing counter tops, I would suggest a light color such as white with a beige or light grey vein or striation for some sort of pattern. You might be able to find the same color and design in floor tile OR opt for a wood floor as another poster suggested.

Sorry I am so late coming to your site - you are an inspiration to all, homeowners and advisers alike. For your planting advice, I suggest you call Merrifield Garden Center to see if they will come out your way. They currently have wonderful garden centers in Merrifield and Fairfax (both in Fairfax County) and a new one in Gainesville, but they may come further south to wherever you reside. (www.MerrifieldGardenCenter.com) Even if they don't send designers to your area, they are worth a trip to see their huge selection for a day of pleasure and inspiration, or to pick up some plants. Most of my clients are in the Fairfax and greater Washington area, but I am currently living out west below Front Royal, VA on the Shenandoah mountainside - wonderful views. cascio.offsite@gmail.com

I'm guessing you are from NZ (kiwi) :) The handy sanders did our floors - http://www.handysanders.co.nz/. They did an AWESOME job and are reasonable priced. I would definitely recommend.