He also apologised to Kylee Guy.
Mrs Guy declined to comment after the decision was released.
Macdonald's former father-in-law Bryan Guy said the family was happy with the Parole Board's decision.
"That was our preferred option, that he serves a bit more time if not the full time. We're quite pleased.''
Ideally, Macdonald would serve his full five year sentence of imprisonment, Mr Guy said.
"I think we're often too lenient with parole in New Zealand.''
However, there was a little apprehension in the Guy household in the build-up to the hearing.
"But we know that when people do get paroled there's a lot of conditions put on them so we weren't overly nervous about it.''
Mr Guy said he gave the change of Macdonald being denied parole "a 50/50 chance''.
The board heard that Macdonald had been working in the community while serving his time at Rolleston Prison, helping chop wood and clean up after severe wind storm damage in Canterbury recently.
Justice Frater said he was a man "of some notoriety'', and asked how he dealt with that.
He said he'd worked with members of the public and had no issue.
One day he'd been mowing lawns and while driving alone on a public road he got a flat tyre - a tyre mechanic called out to help him didn't recognise him, he said.
His lawyer Peter Coles told the board that he'd advised Macdonald not to apply for early release last year because he wasn't ready for it.
Macdonald identified areas of high risk, if he was released, would include contact with his ex-wife and her partner, adverse comments from members of the public, building trust with new relationships, contact with his co-offender and media harassment.
He said his proposed release conditions of living in the South Island, living under a curfew and electronic monitoring, would have alleviated his victims', and the public's, concerns.
He believed he would still be with his wife if he had not been convicted of these crimes.
Macdonald was seeking an early release to a Christchurch address.
He accepted many of the details of his psychologist report.
Macdonald remained composed during the hearing.
It lasted about 75 minutes and after a short deliberation, Parole Board panel chairwoman Justice Marion Frater told him parole was refused.
Macdonald took the decision calmly, said thank you, and was led back into custody.
Family members, including his parents, were there to support him today.
He told the hearing that with the help of a psychologist he had changed greatly over the last year.
His last parole hearing had come shortly after the murder trial and he accepted he hadn't though much about the crimes he'd been convicted of.
Nor did he think about the victims if the crimes which he accepted were driven by revenge, bad ideas, and in the past, if someone he thought had crossed him, he would hold a grudge and seek revenge.
Macdonald's former wife Anna Guy and her father, Bryan Guy, were not immediately available for comment.
The 33-year-old, who was acquitted of murdering his brother-in-law Scott Guy, today learned that he would not yet be freed from prison after two-and-a-half years behind bars.
After a jury found him not guilty of murder at high-profile trial in Wellington, Macdonald was sentenced in September last year to five years' imprisonment for a crime spree targeting neighbouring Feilding farms.
Macdonald pleaded guilty to six charges, including vandalism of a new house that Scott and and his wife Kylee were building, the slaughter of 19 calves with hammer blows to their heads, the theft and killing of two trophy stags, emptying a neighbour's main milk vat of about 16,000 litres of milk worth tens of thousands of dollars, and burning down a 110-year-old whare.
The charges were not revealed to the murder trial jury, partly because they would have been prejudicial.
Macdonald faced his second parole hearing at Christchurch Men's Prison today.
In denying him parole a year ago, the board said Macdonald had "much to do" and would be required to undertake one-on-one counselling with a psychologist.
A psychological report described him as having "narcissistic traits", while a personality test revealed a "marked tendency to portray himself as having socially desirable qualities and "can be self-involved and over-value his self worth``.
Scott Guy's father, Bryan Guy, told the Herald last week that knowing Macdonald would eventually be released meant he and wife Jo were realistic about how they would be when the moment finally arrived.
"You've still got to be courteous and polite and so on.''
Macdonald is the estranged husband of Bryan Guy's daughter Anna, who is now living in Auckland with her new partner, Brent Jameson. The couple are expecting their first child together. Ms Guy has four children with Macdonald.
Bryan Guy said the children often spoke about their father, and would have a relationship with him, although it would not change things dramatically for the rest of the family.
"He's still the father of our grandchildren. I dare say there will be some contact _ we won't be looking for too much.''
