Given the choice between $5/month and, say, $300 upfront most people will choose monthly. I think both options should be available but realistically not many people are going to buy the box. There have been a bunch like FreedomBox, IndieBox, Helm, etc. but they don't seem to take off.
Interesting – Helm definitely looks cool, close to what I had in mind. Pricing of $400 plus $99/yr subscription sounds tough – and it doesn't include a wifi router, which I think is an element that would make more sense to the average home user (and ensure it's not connected to the internet over wifi).
I prefer the router+server approach as well but Helm takes a different approach of VPNing all traffic through AWS so it can have a public static IP; unfortunately this introduces a bunch of cost and overhead.
