Whats more important? This is a tough one. I don't like spam at a community but the last thing I want to see is a forum hosted on a free host. What's more important to you guys?
A forum can be on a free host and have better content then a forum on self hosting. So long as the community is good, and the content is good then I don't see why being hosted by yourself or hosted by someone else matters.
Content any day of the week. No matter what forum you have, people will come on for what is there. Like you can have a market stall or a 5 star grocery shop, the one that sells the best product wins.
A couple of years ago 3 forums that I am a member of were hacked several times. Because the forums were hacked and defaced so many times, I stopped visiting. Regardless of how good the content is, if the software is not secure, there is no reason to visit. One forum was hacked several times on and off for at least a month. At one point the whole site was off line for around 2 weeks. The owner finally upgraded to a better and more secure software. During the down time a lot of the members moved on. A buddy of mine (this is someone I know in real life) had a forum that was hacked so many times he finally closed the site. He said it was not worth it. And yet one more site that I used to visit was down for about a month because of hackers. The site would go back online, a few days later it was hacked again and defaced. This site was using free hosting and the free version of invision power board - which is no longer supported. Even to this day the owner still uses that free forum hosting and is hacked or defaced every couple of months. Regardless of good the content is, the site MUST be online so people can see the post and threads. Forums built with insecure software are not the way to go. Over the years I have seen lots of forum communities destroyed by hackers. Some of these communities were brought down forever, some were brought down for a few weeks / months. But either way the community and the forums reputation were damaged. Its one thing to be hacked, it can happen to anyone. But its another thing to be hacked over and over for weeks on end. In the end, the content and the stability of the community should be equal.
Content rules the roost ... a forum is all about communication and interaction. If the forum does not have good content then software is of no priority. A secure software is also essential ... SMF is quite secure and so is vBulletin ... Try these softwares but make sure you have excellent content ... Forum host does not matter till the time you experience these issues : 1 downtime ... every cheap host will have some downtime ... but if you host cannot maintain 98% uptime over 3 months without major breadowns, you should switch hosts ... 2 load capacity ... a forum like vBulletin can slow down the host if you have more than 300 people logged in at the same time. Most shared hosts will cut off your service at that time. Make sure you select a good host even if it costs a few dollars more per month. I recommend Geekstorage. Check it out.