Standard sirens - gravitational wave (GW) sources with an electromagnetic (EM) counterpart - can be used to measure the Hubble constant directly which should help to ease the existing Hubble tension. However, if the source has a relative velocity to the expanding universe on top of its motion due to the Hubble flow, a relativistic redshift affects the redshift of the EM counterpart and the apparent distance of the GW source, and thus it needs to be corrected to obtain accurate measurements. We study the effect of such a relative velocity on GWs for a source in an expanding universe showing that the total redshift of the wave is equal to the product of the relativistic redshift and the cosmological redshift. We, further, find that a relative velocity of the source changes its apparent distance by a factor (1+z_rel)^2 in contrast to a linear factor for the cosmological redshift. We consider the effect of the relative velocity on the chirp mass and the apparent distance of the source an observer would infer when ignoring this velocity. We find that for different astrophysical scenarios the error can range between 0.1 % and 7 % for the chirp mass while the error in the apparent distance can be between 0.25 % and 15 %. Furthermore, we consider the error introduced in the measurement of the Hubble constant using standard sirens for two cases: (i) when the effect of velocity on the redshift of the EM counterpart is considered but not on the apparent distance obtained from GWs and (ii) when the effect of the relative velocity is ignored completely. We find that in the first case the error can reach 1 % for a source moving due to the peculiar velocity of its host galaxy and that in the second case the error can be more than 5 % for a source at the distance of GW150914 with the same velocity.