xcode-select error when opening application with Finder

[ratsclub]

Setup

Flake-based home manager without nix-darwin.

• Home manager configuration
• zsh configuration

Problem

• When I run emacs from the terminal, I can use git just fine.
• When I open emacs through finder and run git from eshell it gives me the following message:

~ $ git
xcode-select: note: No developer tools were found, requesting install.
If developer tools are located at a non-default location on disk, use `sudo xcode-select --switch path/to/Xcode.app` to specify the Xcode that you wish to use for command line developer tools, and cancel the installation dialog.
See `man xcode-select` for more details.

What could I be possibly missing here? The same happens on a macbook but emacs and vscodium have the issue.