For the record. Hordes being powerful early and then declining is the intent.
Thats the way we want it, but the feature needs to be tweaked a bit more in order for it to be fun. I realise you're not going to do any large changes at this moment, so I'm going to think of one simple change that would improve the hordes the most.
The hordes ought to value getting tribute a lot higher in peace negotiations and their neighbours ought to value paying tribute less, resulting in earlier peace deals and shorter wars. The goal would be to have less protracted horde wars and therefore less land gained by the hordes due to the occupation mechanic. The neighbours will not be as messed up and the hordes will not be overextending themselves.