With a second report in, the message is clear: While single-family home sales dipped last year in Massachusetts, strong demand still exists for condominiums.

The big question is when -- or if -- the condo market will soon suffer a correction of its own.

The Warren Group, a Boston-based real estate services company and publisher of Banker & Tradesman, reported this week that 34,672 condominiums were sold in Massachusetts during 2005, a 12.1 percent increase from the 30,918 recorded a year ago.

However, sales of single-family homes dropped 7.6 percent, to 63,350 units.

The report is comparable to one released earlier by the Massachusetts Association of Realtors, which hasn't officially reported full-year figures but has estimated that home sales dropped 3.5 percent in 2005.

Experts say two things are at work here: affordability and demographics.

"More people can afford condos than single-family homes," said Timothy M. Warren Jr., CEO of The Warren Group. "Second, you've got an aging population that doesn't need the square footage they once had. Baby boomers have been thinking about downsizing."

John DeAngelis of North Chelmsford-based Earth Realty, who has built more than 100 condominiums in Lowell alone, said many of the people buying his condos already have a home elsewhere.

"These are baby boomers who already have a home in Florida or Maine or somewhere, and they are looking for less maintenance," he said in reference to the 70 million Americans born between 1946 and 1964. "Then you've got the young market, which can't afford houses anymore."

The median price for a single-family home sold in Massachusetts last year was $345,000, up a modest 5.5 percent from 2004, the Warren group said in its report this week. However, in each of the four previous years, prices rose by double-digit percentages.

Condo prices, meanwhile, rose 8.1 percent last year to $278,379.

In Middlesex County, the change is even more dramatic. The median price for a single-family home was $425,000, up 6.3 percent, but sales dropped 8.5 percent, to 12,895. However, condo sales shot up 29 percent, to 8,798, with the median condo price advancing 16.6 percent, to $299,615.

"This area is desirable because of highway access, mountains and the ocean -- plus it's only 30-40 minutes to Boston," DeAngelis said.

"It's where a lot of good jobs are," added Warren.

But can it last? The Census has reported that for two consecutive years, Massachusetts has lost population. Also, the state was hit hard after condos were hyped in the 1980s.

"In the '80s, it seemed like things were much more speculative," Warren said. "It seemed as though everybody you met, whether it was at the gym or the grocery store, was saying that they were buying a condo as an investment. You don't see that now."

DeAngelis expressed concern, but was hopeful.

"I don't know (how long it can last)," he said. "We worry about it, and obviously we don't want to see it change. It depends on a lot of things. But what can you buy in Florida for under $1 million?

"We have an opportunity in Lowell to build 1,000 more units in 10 years."

Warren admitted that the population drops, while only by trace amounts, are causing a buzz in the industry.

"It only makes sense," he said. "I have talked to Realtors who have expressed grave concern about the declining population. Affordability is driving younger people out. But Boston is a magnet for its schools and hospitals, and we have successfully reinvented ourselves in the past, from high-tech to biotech to health services.

"I'm confident we will again."