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I'm my experience, running Ollama locally works great. I do have a beefy GPU, but even on affordable consumer grade GPUs you can get good results with smaller models.
So it technically works to run an AI agent locally, but my experience has been that coding agents don't work well. I haven't tried using general AI agents.
I think the amount of VRAM affordable/available to consumers is nowhere near enough to support a context length that's necessary for a coding agent to remain coherent. There are tools like Get Shit Done which are supposed to help with this, but I didn't have much luck.
So I'm using OpenCode via OpenRouter to use LLMs in the cloud. Sad that I can't get local-only to work well enough to use for coding agents, but this arrangement works for me (for now).