I hear some people saying that after death souls often get re-born among close relatives. For example, your grand parent may be re-born as your child after death. Although I never believed in this in the past, due to some of the incidents that happened during last couple of years, I feel like there is some truth about this. Does Buddha give any explanations in this respect?
According to the Mata Sutta (SN 15.14-19):
At Savatthi. There the Blessed One said: "From an inconstruable beginning comes transmigration. A beginning point is not evident, though beings hindered by ignorance and fettered by craving are transmigrating & wandering on. A being who has not been your mother at one time in the past is not easy to find... A being who has not been your father... your brother... your sister... your son... your daughter at one time in the past is not easy to find.
"Why is that? From an inconstruable beginning comes transmigration. A beginning point is not evident, though beings hindered by ignorance and fettered by craving are transmigrating & wandering on. Long have you thus experienced stress, experienced pain, experienced loss, swelling the cemeteries — enough to become disenchanted with all fabricated things, enough to become dispassionate, enough to be released."
In the Assu Sutta, the Buddha taught that the amount of tears that one person has shed in all his previous lifetimes added together would exceed the volume of water found in the four great oceans.
I made a calculation in this answer based on the Assu Sutta, to show that according to the Buddha, we have all been reborn no less than 20 quintillion (20 x 1018) times. However, since the Buddha says that "a beginning point is not evident", I guess that it should be far greater than 20 quintillion times, perhaps approaching infinity.
In the Mata Sutta, the Buddha reinforces this point by saying that it's hard to find somebody in existence whom you have never had anything to do with.
In other words, your finding that you are probably born among relatives from former lifetimes is true, because almost every person you meet in your life was a relative in some former lifetime. In fact, every human being currently living on Earth may have been somebody you have known in a previous lifetime.
It is possible, however it is off chance.
How about that off chance possible?
The reincarnator must does:
Much enough merit.
Because the merits cause the rebirth in a new good life, such as a human life, angel.
See: K.N.Dhammapada's Commentary Patipūjikā, and chaddanta-jātaka's commentary.
Very strong efforts of mind's desire, intention, management, inspiration, decision, etc, to act about "specified new life" in every life's moments, until he die.
Because the strong efforts to keep regularly actions that cause of target new life, will send you to be the specified new life, as a director. It is like a transgender man who use every second of life to act like a woman.
Die just in the same millisecond of new life fertilization.
Because the dead-mind is immediate contiguity cause of rebirth-mind. And mind arising and vanishing is very fast (over trillions times per snap finger).
See: Sanṅgaha 4th chapter.
However it is still very hard, so buddha taught in Pansu Suttas:
"The great earth is far greater, lord. The little bit of dust the Blessed One has picked up with the tip of his fingernail is next to nothing. It doesn't even count. It's no comparison. It's not even a fraction, this little bit of dust the Blessed One has picked up with the tip of his fingernail, when compared with the great earth.
"In the same way, monks, few are the beings who, on passing away from the human realm, are reborn among human beings. Far more are the beings who, on passing away from the human realm, are reborn in the animal womb... in the domain of the hungry ghosts.
You can see that it is very very hard to success. And all the way, you still will be old and dead after that. So, theravāda buddhism never support whole rebirth and reincarnation. We have jātaka, rebirth cannon, just for an inspiration and faith in buddha's ability and experience.
Nowhere you can avoid the suffering, if you still rebirth
This image captured from TEACHING & TRAINING book of Pa-auk monastery: