The problem is it didin't trigger the next phase. Now all the quest does is point me to Jorleif who doesn't say anything else about the quest anymore.
To get past the 'investigate the crime scene' bit - be sure you talk to that guard that is at the scene after examining everything else. She points you towards the blood trail that you follow to the empty house.
Also, It sounds like a lot of people here fingered the Destruction mage as the butcher...
Never listen to odd curio collectors who try to buy evidence from you for insane prices.