water dragons live in trees near water, not in a desert so I think you should chance the bedding (rainforest bedding) and probably the background as this suggest a desert.

He needs ofcourse some branches to clinb since he is aboreal ("tree living") and his cage should be at least 2 x their total length deep and at least 3 x as high.

males can reach 3 feet so they are large lizards

I suggest you take a look at the following links:
here
or this one