I actually currently require a server as-is, and the server that I already have could support it. So hosting costs would theoretically go up, but it would be a long time before traffic hit that point. Currently, it costs me about $100 a month for my physical server (I have an incredibly good deal).
That said, I do have plenty of concerns with this, and I have a lot of thinking/planning to do before I would attempt to approach this. However, I have been surprised by the community response, so I'm taking the concept a little bit more seriously. Moderation is the biggest concern that I have, but I do have some ideas to get past that issue.