Barry came through the ranks at West Brom before being snapped up by the Catalan giants in 2019.
Six months later the 16-year-old has returned to Birmingham to join rivals Villa.
“It (Louie's signing) sends a powerful message about the ambition of this football club," said Villa academy manager Mark Harrison.
“We're delighted - Louie is a local person and his family are all Villa fans, as is Louie.
“He is still a very young man but as he's developed, he's always been one player that you always recognise as having outstanding attributes. He's got a fantastic mentality, he's desperate to do well for this football club.
“He's really driven, he's got great family support, but in terms of what he can achieve, we firmly believe that he can be an outstanding number nine for this football club."