I've been searching around and I have found one answer which is "it's in the same universe" so that shows that it could either be a prequel or a sequel.

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    As far as the developers have said (that I've seen anyway), it is the same universe, but neither a prequel or a sequel. It's a completely different story with completely different characters. – Kaizerwolf Aug 8 '16 at 13:49

To piggy back on what @Kaizerwolf has said in the comments above. Outlast 2 is going to be an "Indirect Sequel" that will "take place in the same universe at Outlast, but it will feature different characters and a different setting" According to the Outlast 2 Wikia.

I'm sure more details will be released as the game continues to develop. I hope this helps out :)

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    thanks man it makes more sense now and hopefully we do get more details i like to play games in chronological order you know. – captaincj2005 Sep 2 '16 at 3:59

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