Is there a pantry or any area close by where a cabinet could be used in a different room to store things?

Rustoleum $40 countertop paint - Soapstone would be easier than a granite look a like.

I have a new white GE microhood. It is great for saving space, which you are in dire need of. It can be awkward for reaching the back knobs on the stove but a price I'm willing to pay for an extra couple of feet of counterspace! It was around $180 on sale at Home Depot.

Painting the cabinets is a big job. Save them for last - just clean them well and see how you like them after you do the countertop.

Knobs are bothering me. They can also be very expensive. You might consider spray painting them. They now have decent "metallic" paints so you could paint them a steel or oil-rubbed bronze quite easily, or even black to match the countertops.

If you paint the grout white, you might be okay with that tile on the back.

Do you have a picture of the light above the sink when it is not on? Is it just an undercounter bare bulb? Sorry but the picture is pretty glary.

The wallpaper is cute if it's in decent shape.

The floor is a little too dark for my tastes, especially if you are unable to paint the cabinets at this time. If you Google it you can find instructions for painting linoleum with Porch paint. You could do a solid color or even squares or chevrons. See if it comes in quart size - you have a small space.

And finally, I'd look for a new faucet - something a bit more substantial. I've got one that has the pull out sprayer - pretty sure I got it at Costco for not a great deal of money.

This is the one I have - $148 at Home Depot

Here is one for $88. Truth to tell I don't use that dispenser above - can't even figure out if it's supposed to be for dish soap or hand soap! In other words, you don't need it!

I remember have this type of kitchen
once upon time. Yes, the layout is the problem. Since you are on a
budget leave the cabinets as is and use toward change the hardware, make
the counter tops off-white and use off-white subway tiles (homedepot
have good price). All items are at Home Depot. There another countertop
by Wilsonart in Linen Matte it doesn't show up on the post. Leave the
trim color as is.

TrafficMaster Limestone Slab

TrafficMaster Sandstone Paver

Wilsonart Natural Almond

Liberty 1-1/4 in. Venetian Bronze Top-Ring Round Knobs (10-Pack)

BEHR Premium Plus Ultra #N360-1 Seagull Gray Paint

BEHR Premium Plus #HDC-NT-21 Weathered White Paint

I am going to assume there is an eating area close by - maybe a dining room since there is no room to eat in the kitchen. I would consider making use of the eating area as almost an extension of the kitchen. Put a cart in that area and move the microwave there. I would attempt to make the kitchen primarily a prep and cooking area. In the eating area you can create some very inexpensive storage. If room is limited, place a series of two or three inexpensive bookcases along the wall - check second hand stores, Restore Habitat stores, or get new at a discount store. Place curtains across the bookcases and use this area as a pantry for canned goods, cereal, crackers etc. I would include many of your eating dishes and much of your silverware. It will make setting the table easy - everything right there. If the room is a bit more spacious, use a secondhand dresser or old kitchen lower cabinets - paint, use curtain in place of doors and top with whatever you can find - piece of butcher block, wood plank, countertop remnant.

In the actual kitchen - certainly paint the cabinets. I am not usually big on painting cabinets, but your kitchen will look brighter and more open with lighter cabinets. (You can also refinish, which is what I am doing.) To paint cabinets: clean off any grease, or dirt. lightly sand or use de-glosser if very shiny. Prime with Zinsser 123, two coats. At least two coats of topcoat - I use an acrylic latex enamel. I like light colors in small spaces and I am partial to creams, whites, light blues and greens. I would consider removing the doors or entire cabinet next to the fridge. It seems counterintuitive given your need for storage, but if you can create storage elsewhere, it would help make the kitchen feel more spacious. Replace the cabinet with an area of open shelving - but don't clutter it - just your most frequently use mixing bowls, pyrex, corning ware and such - maybe some dishes. Wall color depends on cabinets. Whatever combo makes you smile.

Countertop - this depends on your situation. If you feel that your income will increase down the road, then the Rustoleum product is good fix for a few years. If you are on a fixed income and need a more lasting solution, then get a stock laminate countertop from a home center store. You can check Restore Habitat store for a gently used one. They are very inexpensive, but also very hardy and they are reasonably attractive. Your major expense may be in getting it installed if you do not have DIY skills or a friend or relative who can help.

The cost of the flooring will be determined by how much you can do yourself. Very best is to start by removing the old floor - a tough job. I've done it one to many times myself. You can check into the vinyl tiles or vinyl plank flooring. One of the cheapest is vinyl sheet flooring, but it is surprisingly a pain in the you know where to install because you've got this huge piece of vinyl - and trying to cut it to the right size - makes me crazy. Tile would give you one of the best results but would probably put you over your budget - close if you can do it yourself. It is a lot of work, but doable. I am the wrong side of 50 and did my powder room floor last year. It would require you take up the present floor, instal 1/4 inch cement board - screwed down - some cement board comes with screws and drill bit needed, fiberglass tape to tape between cement boards, thin set to lay tile in, grout, tiles, plastic bucket, trowel, access to a wet saw (some home centers have one people can use) - and the realization it is going to take you three times longer than expected.

Backsplash - you can paint the backsplash with another product - also by Rustoleum. Tin tiles are another idea - I have heard they can be placed over existing tiles.You can remove the old tiles and replace with new - more tile work - you may have to repair the wall underneath if taking the tiles down ruins the drywall. Beadboard paneling can also be used as a back splash.

If you would like me to clarify or explain any of these ideas in more depth, just ask:)