better rendering provides use of tikz library arrows.meta with help of bending:
\documentclass[tikz, margin=3.141592mm]{standalone}
\usepackage{tikz}
\usetikzlibrary{arrows.meta,bending} % <--- added
\def\centerarc[#1](#2)(#3:#4:#5);%
%Syntax: [draw options] (center) (initial angle:final angle:radius)
{
\draw[#1]([shift=(#3:#5)]#2) arc (#3:#4:#5);
}
\begin{document}
\begin{tikzpicture}[>=stealth]
\draw[help lines] (0,0) grid (2,2);
\centerarc[thick,<->, semitransparent,red](1,1)(70:195:1cm);
\centerarc[thick,blue](1,1)(-90:25:1cm);
\draw[thin,dashed,blue] (1,1) circle (1cm);
\end{tikzpicture}
\end{document}

from tikz & pgf manual:
- "Remark: The libraries arrows and arrows.spaced are deprecated. Use arrows.meta instead/additionally, which allows you to do all that the old libraries offered, plus much more ...", and
- "One common pitfall when arrow tips are added to a path should be addressed right here at the beginning:
When TikZ positions an arrow tip at the start, for all its computations it only takes into account the first
segment of the subpath to which the arrow tip is added. This “first segment” is the first line-to or curve-to
operation (or arc or parabola or a similar operation) of the path; but note that decorations like snake will
add many small line segments to paths. The important point is that if this first segment is very small,
namely smaller that the arrow tip itself, strange things may result."
latex-latexinstead of<->. – Peter Grill Nov 20 '18 at 07:57