unable to locate libxml2 when installing gem - ruby

Question

Problem with install of twilio-ruby. I have installed libxml2 using homebrew and confirmed it is there. However when I try running
gem install twilio-ruby
I recieve an error that it cannot find libxml2. I have tried specifying the path to libxml2 but still can't get it to install. Any suggestions?
I have tried the following
gem install twilio-ruby -- --with-xml2-dir=/usr/local/Cellar/libxml2
gem install twilio-ruby -- --use-system-libraries
Then all of these three together:
gem install twilio-ruby -- --with-xml2-dir=/usr/local/Cellar/libxml2/2.9.1 --with-xml2-lib=/usr/local/Cellar/libxml2/2.9.1/lib --with-xml2-include=/usr/local/Cellar/libxml2/2.9.1/include
Each time I get output similar to the below.
gem install twilio-ruby -- --with-xml2-dir=/usr/local/Cellar/libxml2
Building native extensions with: '--with-xml2-dir=/usr/local/Cellar/libxml2'
This could take a while...
ERROR: Error installing twilio-ruby:
ERROR: Failed to build gem native extension.
/Users/tom/.rvm/rubies/ruby-2.1.1/bin/ruby extconf.rb --with-xml2-dir=/usr/local/Cellar/libxml2
checking for libxml/xmlversion.h in /opt/include/libxml2,/opt/local/include/libxml2,/usr/local/include/libxml2,/usr/include/libxml2... no
*** extconf.rb failed ***
Could not create Makefile due to some reason, probably lack of necessary
libraries and/or headers. Check the mkmf.log file for more details. You may
need configuration options.
Provided configuration options:
--with-opt-dir
--without-opt-dir
--with-opt-include
--without-opt-include=${opt-dir}/include
--with-opt-lib
--without-opt-lib=${opt-dir}/lib
--with-make-prog
--without-make-prog
--srcdir=.
--curdir
--ruby=/Users/tom/.rvm/rubies/ruby-2.1.1/bin/ruby
--with-xml2-config
--without-xml2-config
--with-xml2-dir
--with-xml2-include
--without-xml2-include=${xml2-dir}/include
--with-xml2-lib
--without-xml2-lib=${xml2-dir}/lib
extconf failure: need libxml2.
Install the library or try one of the following options to extconf.rb:
--with-xml2-config=/path/to/xml2-config
--with-xml2-dir=/path/to/libxml2
--with-xml2-lib=/path/to/libxml2/lib
--with-xml2-include=/path/to/libxml2/include
extconf failed, exit code 1
Gem files will remain installed in /Users/tom/.rvm/gems/ruby-2.1.1#carecoach/gems/libxml-ruby-3.0.0 for inspection.
Results logged to /Users/tom/.rvm/gems/ruby-2.1.1#carecoach/extensions/x86_64-darwin-12/2.1.0-static/libxml-ruby-3.0.0/gem_make.out
'

Answer 1

So after much pain and frustration, and trying a bunch of stuff the solution was the following:
gem update --system
xcode-select --install # Then agree to the terms, even if you have done this before!