He is not completely accepted by the hobbit community , but he seems to be perfectly happy there.
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One wold think Bilbo belongs in the shire but his adventure had changed him. I don't think that, after all that had happened, Bilbo could go back to his old predictable Hobbit routine. I also think that the ring had changed him in ways that he is yet to know, Bilbo is a hero and the simple life is not always conducive to adventurous ones like Bilbo.