For anyone else having this problem you need to reboot your mac and press ?+R when booting up. Then go into Utilities > Terminal and type the following commands:
csrutil disable
reboot
This is a result of System Integrity Protection. More info here.
EDIT
If you know what you are doing and are used to running Linux, you should use the above solution as many of the SIP restrictions are a complete pain in the ass.
However, if you are a tinkerer/noob/"poweruser" and don't know what you are doing, this can be very dangerous and you are better off using the answer below.
https://stackoverflow.com/questions/32659348/operation-not-permitted-when-on-root-el-capitan-rootless-disabled
