There are many reasons why one may want to setup a home lab. For me, the reason is being able to mock up several different scenarios using different software stacks and play with hardware.
If you want to setup a lab like I have, it requires ESXi as the hypervisor on physical hardware. However, you can choose VirtualBox, VMware Workstation, XenServer, KVM or whatever hypervisor you wish to use. The main idea is being able to build parts of your lab as virtual machines(VMs).
There is a mix of physical devices and virtual devices that allow me to practice management of switches, routers, ASAs, servers, network security devices(Snort, Suricata, BRO, pfSense, etc), logging stacks, and anything else that interests me at the time.
My lab hardware consists of:
1 HP Gen 6 DL380
1 Cyclades 32 port term server (not in diagram)
1 SMC 1GBps 24 port switch
1 Ubiquity Wireless Access Point
1 Cisco 5505 ASA (not in diagram)
1 Cisco 2811 router (1x VWIC2-2MFT-T1)
2 Cisco 1841 routers (2x WIC-1DSU-T1-V2)
4 Cisco 2950 24 port switches