Directors Henry Joost and Ariel Schulman weren’t exactly the most obvious choice for the next “Paranormal Activity” film, coming off of last year’s debut “Catfish,” which delved into the peril of online relationships using documentary techniques that were questionable at best. However, the pair prove to be a great fit for the franchise thanks to a focus on expanding the series’ mythology and some clever twists on the formula of the first two films.

A prequel to “Paranormal Activity 2,” which was a prequel to the original, part three finds adolescent versions of sisters Katie and Kristi being terrorized by the now-familiar demon, here given a patronizing nickname and introduced as Kristi’s imaginary friend. When stepdad — or live-in boyfriend, the film never bothers to clarify which — Dennis (Christopher Nicholas Smith) tries to get to the bottom of the demonic presence in the family home, predictable haunted house shenanigans ensue.

It’s become clear by now that “Paranormal Activity” films are pure formula and you know if you’re a fan or not. As long as you can put up with the overly convenient exposition and crushingly stupid characters with a penchant for filming when they should be running for their lives, there’s often some nail-biting chills to be found. Until the directors run out of ways for the villainous demon to terrorize the characters and audience, the franchise will continue to entertain. Joost and Schulman up the ante splendidly here, both giving us quick glimpses of the demon, usually spotted as a shadowy figure, and finding a creative way to build tension by mounting a camera on an oscillating surface that pans between two rooms, revealing new terrors with each rotation.

The newest entry in the franchise is easily the funniest to boot, punctuating its jump scares with big laughs and giving Smith plenty of natural, funny reactions to the house of horrors he finds himself in. Smith fares a little better than the male leads of the previous two films. He’s more proactive and likeable than those who came before him and definitely more charming in his relationship with matriarch Julie (Lauren Bittner). By making younger versions of Katie and Kristi (played by Chloe Csengery and Jessica Tyler Brown, respectively) the target of most of the demon’s machinations, the directors manage to make their villain seem more menacing, thanks to the seemingly genuine terror the young actresses effortlessly convey. Brown especially stands out as she slowly realizes that her imaginary friend is much more than a harmless construct of her imagination, her timid respect transforming to terror in a strong performance.

Joost and Schulman also expand the franchise mythology creatively, mostly in a dynamite final sequence that assaults the audience with jump scares and ends on a chilling note that would almost make another film feel welcome. The finale is a brilliantly constructed piece of suspense, placing the hero in an unfamiliar setting and giving us escalating, terrifying imagery with each new room he explores as his world slowly descends into hellish insanity.

By part three, audiences know what they’re getting into with a “Paranormal” flick. The films are fun, often terrifying and work best in a crowded theater, listening to the crowd around you succumb to minor panic attacks as you try to keep your own terror at bay. These films are purely experiential, working spectacularly in the moment you watch them and holding up to post-film analysis only as long as you focus on how well the tension is doled out over the 85-minute runtime and ignore some of the more irrational character decisions and story conveniences. As far as a “Paranormal Activity” film goes, the third installment probably works best as a traditional narrative, and by embracing its haunted-house roots brings new life to a franchise that could have easily been dead in the water.

Printed on Friday 21, 2011 as: Third 'Paranormal' installment continues to scrounge up scares