I usually divide bad movies into two categories: poorly executed/written (e.g. Deck the Halls, Old Dogs) and weirdly envisioned (e.g. The Room, Tyler Perry's Temptation). Hider in the House is clearly the latter, making it the most bizarre slasher flick I've ever seen.
I'm guessing it was pitched to play upon the fear of a stranger hiding just out of sight in your house. But the audience spends so much screen time with Gary Busey that you sympathize with him and ultimately the fear is that he'll get discovered & have to explain himself.
"No, Gary Busey! Don't hover over her while she sleeps. She's going to wake up and you're going to have to have the most awkward conversation ever!"