Yes, it can, and you can enchant and make spells right from your room.
My advice, though? If you want a very large, beautiful house right now? Do the "Where Spirits Roam" quest in Anvil. You have to buy the house there for only 5000 septims, which is 3000 more than the Imperial Waterway house, but so hundreds of times better. You won't find a better deal in the entire game and won't find a bigger and better house in the game until you start spending tens of thousands of gold. Sure, there is a quest involved, but it's fantastic and the rewards are perfect!
Just trust me. The only houses that are better than Benarius Manor are Arborwatch in Chorrol and your house in Skingrad, both of which are ~20-25000 gold if I remember correctly. AND you don't have to pay to furnish it; once the quest is finished, all furnishings appear. Experience points, free furnishing, big, beautiful house for very little gold = FTW. So like I said: best deal.