Story: While I found the story gripping, it most certainly has been done before. It seems like most horror anime nowadays copy the "Higurashi" formula of "boy moves to new town" idea. On the other hand, the deaths were unique... but also very over-the-top (kind of like "Battle Royale," minus the guns). I didn't mind; I found it kept the story interesting, but you might disagree.
Animation: The art designs for the characters, overall, is nice: idealized, pretty character designs. However, the characters themselves look pretty generic: sure, they have natural hair colors (so we don't touch on THAT cliche), but nothing exceptional to set them apart from any characters from many other anime. Even Mei, with her eye patch, does not look as different as she probably can. On the other hand, the backgrounds are artfully done, and the color palate (usually dark and moody) is fitting of the series.
The animation itself tends to fluctuate. During some simple scenes (like, say, the beach scene), it's not bad, but just average. However, the death scenes and Kouichi's nightmares struck me as well-animated enough to make the scenes extra creepy.
Sound: Hmm. This is a toughie. The opening song is certainly haunting and carries the flavor of the show. The ending song is gorgeous, with the violins (they are violins, right?) and all. I think that the background music during the show fit well. The voice acting is fitting, yes, but I feel that when the characters went insane, I couldn't hear it. The voice acting was just kind of static; it stayed the same through every scene.
Characters: As generic as they come. No, no, that was rude. But seriously though. Every character seemed to fit some stereotype (guy who moves into new town, mysterious girl, mildly tsundere-like girl, funny best friend, kind boy who balances out funny best friend, etc.) I did not see any character development (except maybe for Kouichi's slightly-an-epiphany at the very end).
Overall: The mystery was good (I couldn't correctly guess who the dead person was, but it seems like many people could). Lots of people are calling it scary, but to me it registered as more "kind of creepy." The deaths, while horrific, are not usually shown in incredibly gory detail and are often too ridiculous to seem plausible. Kouichi's nightmares WERE creepy and all, but they didn't last long. Personally, I thought the scariest part was when Kouichi and Mei were looking at an old class photo containing the dead person. That guy's eyes still haunt me.
Ah well. I thought I liked this anime a lot more before I reviewed it. Darn.