Horror Films Budget: How do they make so much money?

Typically, horror films give the biggest return on investment, this is due to the fact that horror films entertain a large proportion of people, it attracts a large variety of people, and appeals to lots of contrasting age groups.

Horror films entertain people because they want to feel the sense of fear. You choose your entertainment because you want it to affect you. That's certainly true of people who go to entertainment products like horror films that have big effects.  Many watch horror films for the tension and suspense, as high grossing films such as Paranormal Activity increase the levels of suspense through the increasingly threatening acts the characters witness directly and through video replays.

Why do horror films have such a low budget?
On the 25th November 2009, Paranormal Activity was released, its profit was over $193 million, and it only had a budget $15 thousand, studios then released that it was not an important factor for the audience how inexpensive the production value was, but what mattered most was that the film was gripping and enticed them, and that there was an element of fear. Studios decided that they no longer needed to have huge budgets, through the success of films such as Paranormal Activity and The Blair Witch Project, which had huge profits even with their limited budgets.  From 2010,  the horror films with limited budgets have dominated the box office and the marketplace. For instance, films like Insidious and The Devil Inside had limited budgets of $1.5 million and $1 million, and The Devil Inside grossed over $100 million.

Blumhouse Productions, since 2009 their horror films combined have cost approximately $45 million. Each Blumhouse film combined has cost less than what Universal spent of The Wolfman, this film had a budget of $150 million and only earned $139 million worldwide, which is less than what the Paranormal Activity earned.

Horror Movies of 2002:
The Ring – Gross: $249 million // Budget: $48 million
Resident Evil – Gross: $102 million // Budget: $33 million
Ghost Ship – Gross: $68 million // Budget: $20 million
Queen of the Damned – Gross: $45 million // Budget: $35 million
Halloween: Resurrection – Gross: $37 million // Budget: $13 million
AVERAGE – Gross: $100 million // Budget: $29.8 million

Horror Movies of 2014:
Annabelle- Gross: $255 million // Budget: $6.5 million
Ouija – Gross: $99 million // Budget: $5 million
Paranormal Activity: The Marked Ones – Gross: $90 million // Budget: $5 million
Deliver Us From Evil – Gross: $87 million // Budget: $30 million
Oculus – Gross: $44 million // Budget: $5 million
AVERAGE: Gross: $115 million // Budget: $10.3 million

Main Brief:
Through this research, I have decided to make a horror film, as they do not require a huge budget and they can still make a huge profit. I will not have to use special effects, as I have discovered that the majority of people are most interested in the suspense and tension that horror films create.