Performance wise is not good to have database on a totally different network of the website hosted itself. It'll delay. Imagine if you have a lot of calls, it'll multiply the delay.
You can host a local database on the EC2 iHaving a database on a different network from the hosted website can indeed lead to latency issues, especially with a high volume of calls. Hosting a local database on the same EC2 instance as your website can mitigate these delays by reducing network latency and improving overall performance. This setup ensures faster data access and smoother operations for your application.'self, this would be the best choice.