I bought a REIT at its peak price. I think i may have bought it when it was overvalued. I bought this REIT when i just started investing and this is my first buy. Now it is dropping non-stop. What should I do?

Personally I'm in the same boat as you, buying into a couple of reits / trusts at their peaks and now watching them sink in the red. Hoping that eventually they'll rise back up somewhat and I can redeploy them elsewhere. That being said, if you decide to hold on based on your long term view of the counter, do ensure that you have the holding power and you don't need to drawdown on this portfolio for near future expenses. But if the management is making a mess of the reit, exit and redeploy elsewhere. Hope this helps

My rule whether in short term trading or long term holding on when to cut loss is this.

When the fundamentals or technical chart invalidates your analysis then its time to cut.