Sorry for the noob question but I can't seem to find proper literature on the subject:
Currently I'm forced to type my IP address to get to my CentOS VM local environment:
How can I change this to something like localhost?
You will not be able to change it to localhost as this is reserved for 127.0.0.1 loopback address. RFC2606 - http://tools.ietf.org/html/rfc2606
However you could set something up using DNS, say if you had an A record set up on your DNS server for yourvm.yourdomain.local with the IP address you specified, then it would work.
A crude way of doing this just for a handful of workstations could be to edit the hosts file and create an entry for the vm and it's IP.
Apologies I'm quite *nix challenged, there probably is an option to make the vm register itself in DNS, but I wouldn't know where to begin on this route.