Barlaser, 23, was rewarded with a one-year contract extension by the Magpies on Monday, according to the Daily Mail.
The news comes following Barlaser's excellent campaign for Rotherham United, in which his 32 performances made him a contender for the League One player-of-the-season award.
After previous spells at Crewe and Accrington, the midfielder will now be given the chance to impress Toon boss Steve Bruce over the summer.
Hughes spent the 2017/18 season with Barlaser at the Crown Ground and thoroughly enjoyed watching his development.
Asked if Barlaser could make the grade at Newcastle, Hughes told Tribalfootball.com: "100 per cent. He has a great personality and he is very technical, unbelievable technical ability.
"Every day in training you'd say to yourself, how have Accrington got him! Why isn't he closer up the leagues! The more games we played you could sort of see why in terms maybe his off the ball, the tackling. His ability on the ball is Premier League standards but sometimes he maybe thought it was too easy, that U23's mentality in terms of wanting to play at his own pace and chewing the ball a little bit.
"That was at the start, but I watched someone develop and as the season went on he just got better and better with the more games he had. His technical ability, in terms of my lower league career, he is the best I've played with, in terms of pinging a ball, in terms of passing.
"He has had Rafa Benitez and Steve Bruce, and he could go into Newcastle now and they could have a new manager again so you need that bit of luck in terms of management but hopefully in the summer he can go back to Newcastle and get a chance to get close to the first-team because he's definitely got the tools to be a top, top Premier League player."
It is reported that Barlaser could be loaned out again next season if Bruce decides he won't need him at St. James' Park.
A move to the Championship looks likely, and quite possibly a return to Rotherham, who are currently second on the League One table.
Joining Paul Warne's side last summer was the "perfect" move for Barlaser, according to Hughes, who reveals he had advised the youngster against a return to Accrington.
"I had a chat with him in Portugal and he said to me he was probably going to go on loan next year and he asked do you think I should come back? And I said no, I said look if you come back I'm not saying its a bad thing but I think next year you need to move up and get yourself to a new club.
"I thought he'd go to a Championship club myself but he ended up going to Rotherham who are in our league. But they are a Championship club in our league. And I know Richie Barker the assistant manager there and I know Paul Warne and they are the perfect for him. Paul Warne, every single day he demands standards, that's exactly what Dan needs. Some mettle, getting around the pitch, putting your foot in. They love that side of it and that's what he needed.
"This year he'd be the first to say that at Rotherham he probably didn't find it easy, but he got better and better, and it was no coincidence as Rotherham got better, he got better. And I think we played them towards the end of the season and he was probably the best player on the pitch. You could see he got better and hopefully next year he can make that next step and become a bit more physically stronger."
It was at Accrington where Barlaser enjoyed his first full season of senior football, making 45 appearances for John Coleman's side.
And Hughes says the former England U18 international will never forget his time with the Lancashire club.
"You get U23s who have too much money, and Dan probably is too, but you'd never have guessed it because he is that down to earth. At the end of the season we have a bit of a golfing trip and he was the first person to say he would come, he bought into that Accrington way. And hopefully that holds him in good stead for the rest of his career.
"Again when you leave Accrington it always has a place in your heart and he still loves the club, he goes to watch a couple of times. I wish him all the best and I hope he becomes a Premier League player. But he won't forget us!"