Yes, this ISP can see your traffic, asssuming other protocols (HTTPS, etc) do not prevent them from doing so.
You've got two aspects to the connection.
- Client <---> VPN Endpoint
- VPN Endpoint <---> Internet
For (1), assuming it has been setup correctly, no one will be able to see anything outside of encrypted traffic. This is true whether you're using public wifi, a home lan, whatever.
For (2), the VPN endpoint must request information for it's clients in the clear. This means whatever ISP the VPN endpoint is on can monitor the connection (again, to the extent permissible by the underlying protocols).
If you have your VPN endpoint on your own infrastructure at home, as it seems like you're asking, you'll be requesting information on the clients behalf. The VPN offers no protection, unless your away from home, in which case it will protect your information as it's sent home, but not as your home forwards the request.
Using an external VPN provider pushes the problem further down the line. If you have some reason to particularly distrust your ISP it may be handy, but don't forget the third party providers ISP can monitor requests, just like your own ISP can.