A BANK has announced radical plans to help people buy their first home by taking out a mortgage with their parents.

The move will be welcomed by thousands of frustrated workers in Hampshire who cannot afford to get a foot on the housing ladder despite earning good salaries.

Earlier this month the Daily Echo revealed how first-time buyers in Southampton would need to earn £36,000 a year to buy a no-frills terraced house.

Average property prices in the city have soared by 81 per cent since 1999, from £75,429 to £136,768.

However, the average salary locally is nearly £25,500, creating a shortage of first-time buyers.

The Bank of Ireland's 1st Start mortgage, which will be available from next Monday, increases the amount first-time buyers can borrow by letting them take out a joint loan with their parents.

The bank will lend up to four times the parents' income, minus their own mortgage repayments, plus the child's income.

For example, if the parents had an income of £31,250 after paying for their own mortgage and their son or daughter earned £20,000, they would be able to borrow up to £145,000.

But the group stressed it was not lending first-time buyers seven times their income as the mortgage was a joint loan, with parents equally liable for the whole debt.

It added that parents would be expected to contribute to monthly repayment costs, although they would not be forced to do so.

The announcement comes as the National Association of Estate Agents called on lenders to do more to help first-time buyers after the number of number of people buying their first home accounted for just 13 per cent of sales last month - an all-time low.

Roland McCormack, managing director of mortgages at Bank of Ireland, said the group decided to launch the loan after noticing increasing numbers of parents were remortgaging to borrow between £20,000 and £40,000 to help their children get on to the property ladder.