This is a nice-looking living room with smaller rug. Perhaps the key is to frame the rug with sofas / sofa and armchair combo / sofa and the window. And another trick is to fill up the room so the size doesn't look awkward.
After 4 months of intense renovations and an insane high level of dust throughout the whole house, our kitchen is almost ready and I really thank you all for all your very kind comments when I posted this photo. I spent last weekend.