iSCSI is obviously slowed down by the network part, if you'd compare two identical drives. Apart from the added hardware your data has to go through, iSCSI is also hampered by the IP protocol. IP splits data into packets for transfer over the network. The problem is of course, you can't really bundle small files into one package without adding compression overhead. So, you'll have to compromise.
I guess, an iSCSI SAN can be useful if you need a lot of storage but don't want the drives generating heat and noise in whichever room your PC is in. Also if your PC doesn't have expansion headroom. Other than that I don't really see a good reason to use it at home.