In the third installment we get a backstory related to the hints and references made by Katie and Kristi in the second movie. In my opinion this is the best of the sequels. I would even go so far as to say this one is the best of the Paranormal Activity movies.
The movie opens with Katie giving Kristi a box of old vhs tapes from their childhood. Katie is dumping the box on Kristi because Katie is moving in with Micah and Kristi has an enormous basement in her home for some reason. The film fast forwards to the break-in featured in the second Paranormal Activity movie. At this point we find out that the one thing that was stolen was the box of old vhs tapes. Then we pick up with a mysterious viewer of the old tapes.
In the tapes we find Katie and Kristi living with their beautiful mother Julie (played by Lauren Bittner) and Julie's handsome boyfriend Dennis (played by Christopher Nicholas Smith) in a house in California.
Finally we have a non douche bag boyfriend/husband! Dennis is pretty much the opposite of the former guys featured in the series. He's believably sweet and reasonable. He's intelligent and he seems to genuinely care about his girlfriend and her children as a husband and father should.
Finally we have a believably strong and vibrant girlfriend/mom! Julie is portrayed as having this strength and vitality that her daughters as adults lack for some reason. Her actions and attitudes make the most sense in comparison to her adult daughters.
We start with Katie's birthday during which we meet the creepy Grandma Lois (played by Hallie Foote). You can tell from the beginning that she's bad news. Continuing after the birthday we round out the cast with Dennis' likeable assistant Randy (played by Dustin Ingram) and the cute sweet babysitter Lisa (played by Johanna Braddy).
The camera is initially used to record things like typical family memories (birthdays) and just for messing around with a camera. It turns out that Dennis has job as a photographer who is hired to film and photograph events like weddings and such. He subsequently edits the videos for the respective clients.
During Dennis' recording of the birthday, Dennis observes Kristi having a conversation with an invisible friend. Later, Kristi makes mention of her friend Toby. Later, Dennis hears a strange thump coming from the girls' room.
One evening, while recording a sex tape, Dennis and Julie are interrupted by an earthquake. The camera is left recording. Dennis observes a strange looking shape in the dust near the foot of the bed. This is the last straw for Dennis after everything else and out of concern for his family Dennis sets up cameras to see what is happening.
Spooky stuff happens. In this case a chandelier doesn't move but still an overhead light swings. When things continue Dennis attaches a camera to an osciallating fan which adds to some interesting unusual views/scares in the dining room/living room. In this film, we have the first breaking of the chandelier/overhead light.
It turns out that Kristi's friend Toby is more sinister than just an invisible friend. In this picture, the "frightening" game of Bloody Mary is featured to a truly scary degree. The visual effects of the haunting that were used in this picture were definitely superior to the previous Paranormal Activity films. The effects team did a great job in providing various scares both jump and otherwise throughout the movie.
For the first time in the franchise, the footage is reviewed more frequently so that Dennis is aware of what is happening. He doesn't do anything which is disappointing but at the same time I got the impression that he wasn't sure what to do exactly thus he didn't do anything besides some research.
The scary events eventually result in the family fleeing their home to Grandma Lois's home. In this film we also learn that Kristi is promised as a bride to Toby the demon for some reason. While at Grandma Lois's we learn that Grandma Lois is apparently aware of Toby's presence and in fact is behind Toby's presence. The scary events culminate in the deaths of both Julie and Dennis as well as the possession of Katie. I have heard that there is a shot of a fire in Julie and Dennis' bed featured in the credits. This is supposed to be the fire that Katie referenced in the first Paranormal Activity movie.
One of the reasons that I feel this movie is the best of the franchise is all of the elements adding up very well. The acting was very good, the characters (with the exception of Grandma Lois) were likeable and you cared what happened to them, there was an attention to detail including making the house look like it was occupied by a family including children, the scares were better conveyed and more interesting to look at, for the most part the story made sense.
I feel that I must add that there is a sizeable plot hole in this film that reflects the problem of continuity that each of the movies connected to Katie and Kristi directly have. I can excuse the plot holes in the first Paranormal Activity movie because it seems that the filmmakers weren't sure that there was going to be a sequel. In this movie we see the death of Julie and yet in both the first and second movie Katie and Kristie's mother is mentioned as in she is alive but possibly overbearing but at least not well liked. In this movie Katie mentions Grandma Lois specifically. When you view The Ghost Dimension, the girls are portrayed as identifying Grandma Lois as their mother as if they have forgotten that their actual mother and Dennis were killed in front of them. Also Julie's death is not very obvious in my opinion. She is lifted and thrown down the stairs so she could have simply experienced broken bones. She is limp when she falls down the stairs so while she may have been seriously injured, she might have survived.
Further, it seems that the demon's efforts to procure a male from the family line could have been easily solved by making Dennis and Julie have sex thus producing a male child. But then again we wouldn't have this entertaining movie if that had happened.
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