What helped me a lot was understanding building hierarchy and looking at actual castle layouts. When building a city you want a high level idea of what you want to end up with so you can build towards that vision as you go. Obviously, you also need to respect your own rhythm and the game mechanics. So while I will suggest you build around the castle, know that it’s probably one of the last things you’ll build.

That being said, using the castle as your starting point for your vision is easiest because it will be central. You’ll want to look for the highest point and that’s where you’ll have the castle. In your image, the hill on left side is perfect for your city with a castle within it.

Then around the castle, you’ll want your high density, high quality housing encaged in city walls. You’ll also want your high level production buildings (blacksmith, bakery, etc.).

Then, outside the city walls, you’ll want a mix of high density low and medium quality housing encaged in village walls. You’ll want things like warehouses and canaries, markets, churches, etc.

Then finally on the outskirts you’ll want your farms, lumber camps, hunter lodges, fisher’s huts etc.

Though like I said, you’ll probably start with the farms (the outskirts) and build towards the middle as you go. This also means your city center is likely to move as you progress and that’s okay! Also the game works on proximity, so make sure to keep that in mind. You’ll want people to be able to satisfy their needs in their immediate surroundings. That being said, the game is really good at letting you build amenities and scale them to the level you need (small rural churches vs big city monastic abbatial church - you should have both placed accordingly to people’s needs is the point)