This should happen along with crafted clothing.  Have them decline in quality over time.  This gives you incentive to take care of them.    What about horseshoes that degrade like weapons?  Say only a 20% loss in speed if you do nothing or a 20% boost in speed if you look at it differently.  The biggest option which would sort of break the breeds it to let players purchase a different horse skin.  Go from black painted to blonde dapple.  Have it bond to that horse, unlike saddles and g