Yeah you can sleep in his bed. Before killing him in the mausoleum while he was asleep in his house, I pickpocketed him and stashed some things in a trunk in his bedroom while on the quest. After completion I went back (I think a day later) and they were still there. That's why I was wondering about long-term.
I did almost lose a whole crapload of stuff in the mage's guild in Cheydinhal. Before going on the recommendation quest to get the 150 lb ring from the well, I dumped all my stuff into the display case thing in the front entrance hallway. When I got back -- I went out to the well and immediately back in -- it was all gone. Luckily I saved just before I did that so got it all back. I have now used a chest in the bedroom area without any incident. Thought that was odd!
Thanks for the tip about the other house, Turija, I don't mind a mess and a corpse. Sounds kinda like my house now, actually.