I'm sure the original spirit of selfhosting is actually owning the hardware (whether enterprise- or consumer-grade) but depending on your situation, renting a server could be more stable or cost effective. Whether you own the hardware or not, we all (more or less) have shared experiences anyway.

Where I live, there are some seasons wherein the weather could be pretty bad and internet or electricity outages can happen. I wouldn't mind hours or even days of downtime for a service whose users are only myself or a few other people (i.e. non-critical services) like a private Jellyfin server, a Discord bot, or a game server.

For a public Lemmy server, I'd rather host it on the cloud where the hardware is located in a datacenter and I pay for other people to manage whatever disasters that could happen. As long as I make regular backups, I'm free to move elsewhere if I'm not satisfied with their service.

As far as costs go, it might be cheaper to rent VMs if you don't need a whole lot of performance. If you need something like a dedicated GPU, then renting becomes much more expensive. Also consider your own electricity costs and internet bills and whether you're under NAT or not. You might need to use Cloudflare tunnels or rent a VPS as a proxy to expose your homeserver to the rest of the world.

If the concern is just data privacy and security, then honestly, I have no idea. I know it's common practice to encrypt your backups but I don't know if the Lemmy database is encrypted itself or something. I'm a total idiot when it comes to these so hopefully someone can chime in and explain to us :D

For Lemmy hosting guides, I wrote one which you can find here but it's pretty outdated by now. I've moved to rootless Docker for example. The Lemmy docs were awful at the time so I made some modifications based on past experiences with selfhosting. If you're struggling with their recommended way of installing it, you can use my guide as reference or just ask around in this community. There's a lot of friendly people who can help!