Both father and daughter have name suppression.
His lawyer Peter Foster told the Palmerston North District Court this afternoon that the offending had occurred only once and followed a particularly stressful time for them both.
The man's father and his 1-year-old daughter both died within a year and the man found himself living in his car and then in emergency housing.
Foster said the psychological report showed the incident was purely situational as opposed to a sexual fetish.
In his sentencing today Judge Lance Rowe said it was important to note that the pair slept together only once.
"There was no pre-meditation or grooming, it was an impulsive act," he said.
"I accept that you were in stressful circumstances at the time. Stressful both for you and for your daughter, in terms of accommodation and the recent loss of your youngest child and the loss of your father," Judge Rowe said.
"That doesn't excuse or explain the offending other than to demonstrate that this was not a settled time for you or your daughter."
Judge Rowe also said even though the man's daughter was an adult she was still developing intellectually and psychologically.
"You could have and should have protected your daughter."
He went on to say that the 3-year-old would need help with understanding her parentage in the future.
In imposing a sentence of six months' home detention for one charge of incest Judge Rowe said the man had pleaded guilty at the earliest opportunity and was extremely remorseful about what happened.
Crown prosecutor Anna Barham said charges might yet follow for the man's daughter.
