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We investigate the consequences of correlated hopping on the ground state properties of hard-core bosons on a square lattice as revealed by extensive exact diagonalizations and quantum Monte Carlo simulations. While for noninteracting hard-core bosons the effective attraction induced by the correlated hopping leads to phase separation at low density, we show that a modest nearest-neighbor repulsion suppresses phase separation, leading to a remarkable low-density pairing phase with no single particle Bose-Einstein condensation but long-range two-particle correlations, signaling a condensation of pairs. We also explain why the unusual properties of the pairing phase are a real challenge for standard one-worm quantum Monte Carlo simulations.