Why do substances contract when cooled?

Heat is just vibrations of the atoms of that substance. So when you heat up a substance, it's atoms vibrate faster and more energetically. As they vibrate, the atoms bump and jostle each other, which pushes each apart from the others, causing the entire substance to expand slightly. Cooling a substance makes the atoms 'lazy', less energetic, and they dont bump each other as much. This allows them to pack more tightly together, thus the substance shrinks.

When heat is released from substance than it contracts.
fOR EXAMPLE:sponge 

If the water vapor content stays the same and the temperature drops, then the relative humidity increases. its vise versa.if the water vapor content stats the same and the temperature rises, the relative humidity decreases. so, yes, i'd say that temperature and humidity have a strong relationship.