Are you sure Sandbox is right for this group?
Nothing against your players, but it doesn't sound like they're the kind of group that would thrive in a sandbox environment. If they're not taking the initiative on the hooks you throw out to them, and they're not coming up with their own creative ideas, perhaps a more narrow, plot driven campaign would be best for them. What's the level of experience? Generally speaking, sandbox games are best run with an experienced DM and at least a few experienced players who can get things rolling. Your players might not be ready for a sandbox campaign yet. Did they ask for a sandbox campaign, or was it your idea?
Assuming you want to press on with Sandbox, I advise having a non-play session where you talk to them about the campaign.
Basically you want to find out what kind of things they're interested in doing and what directions they want to take their characters. Let them brainstorm together and feed off each other's responses. This will give you a better idea of the kinds of things that would be fun (for everyone) to throw at them. Be frank about the difficulty you've had and tell them how they can help you, both by communicating their desires and expectations and by taking the initiative in driving their characters' fate.
Remember that sandbox does not mean the DM cannot have things happen to the characters.
Even in a free country people have things thrust upon them. Just because it's a sandbox campaign doesn't mean you, as DM, must be completely passive and never drive the action. An army of orcs besieging their town, or an evil wizard kidnapping one of their NPC friends, or a villainous, controlling monarch taking a romantic interest in one of their characters can all force them into action, even if that action is fleeing for their lives.
Hang on to the stuff you prep.
One of the great things about being a DM is controlling the universe. If you build a dungeon outside Basetown and throw the rumors at them, they might ignore those rumors, cross the ocean to Port City, and search for rumors about where they can find a Magic McGuffin +3. Have someone point them to a dungeon down the coast, drop a Magic McGuffin +3 in the Basetown-area dungeon you made, and use the same dungeon.