ABSTRACT The local galaxy peculiar velocity field can be reconstructed from the surrounding distribution of large-scale structure and plays an important role in calibrating cosmic growth and expansion measurements. In this paper, we investigate the effect of the stochasticity of these velocity reconstructions on the statistical and systematic errors in cosmological inferences. By introducing a simple statistical model between the measured and theoretical velocities, whose terms we calibrate from linear theory, we derive the bias in the model velocity. We then use lognormal realizations to explore the potential impact of this bias when using a cosmic flow model to measure the growth rate of structure, and to sharpen expansion rate measurements from host galaxies for gravitational wave standard sirens with electromagnetic counterparts. Although our illustrative study does not contain fully realistic observational effects, we demonstrate that in some scenarios these corrections are significant and result in a measurable improvement in determinations of the Hubble constant compared to standard forecasts.