Depends on your site and what you do with it.
£29 on something fairly low power might be fine.
£29 on a heavy magento powered commerce site would be bad, because it'd be a lot slower than on a £2900 spend, and you might well lose that in sales over a year due to lack of responsiveness.
Cheap hosting often doesn't equate well with business continuity and recovery in the event of a disaster, e.g server failure or hacked site. In those cases your £29 you've spent doesn't justify critical attention from a top level systems administrator required to pull you out of a mess - chances it gets you a few emails from a third level offshore support following a chart telling you to upload backups.
£29 probably buys you spells of downtime and slow speed you don't notice but that loses you sales when any one of the thousands of other sites on the same server is bodged/hacked/spamming/overloaded.
Of course it may do none of those things, but the economics of what you are paying for means you're increasing the likelihood a lot.